On Friday, the Senate unanimously approved the Preservation of Access to Care for Medicare Beneficiaries and Pension Relief Act, (pdf) a bill that reverses a 21 percent payment cut for doctors in Medicare and TRICARE, updates the physician payment formula through November 30, 2010, and provides temporary funding relief for single- and multi-employer pension plans that suffered significant losses in 2008. With respect to the pension relief provisions, according to a summary, (pdf) employers that elect the relief would be required to make additional contributions to the plan if they pay compensation to any employee in excess of $1 million, pay extraordinary dividends, or engage in extraordinary stock buybacks during the first part of the relief period. Additional relief would be available to certain plans sponsored by charitable organizations. The legislation now needs approval by the House.

This last-minute compromise comes after the Senate on Thursday failed to move forward a more expansive “tax extender” bill, the American Jobs and Closing Tax Loopholes Act (H.R. 4213). (pdf)  On Wednesday, Senate Finance Committee Chairman Max Baucus (D-MT) unveiled an amended version of the bill in order to reduce its price tag from $140 billion to $110 billion. Generally, this measure would have continued a number of individual and business tax cut programs and extended emergency unemployment, in addition to providing a number of pension funding relief measures.

This bill had been gradually scaled back over the last few weeks in the hope of gaining sufficient support. In May, the House approved this legislation once COBRA premium subsidy extensions were dropped. Last week, the Senate introduced a substitute version of the bill that lacked certain defined contribution pension plan fee disclosure provisions. After it became evident Wednesday that the Senate did not have enough votes to limit debate on the bill, Baucus introduced the trimmed down draft. Despite Baucus’s efforts to reduce the bill’s costs, however, the Senate voted 56-40 – four votes shy of the necessary 60 – to limit debate on the measure and submit it to the Senate floor for a final vote.

During yesterday’s Senate session, Sen. Robert Casey (D-PA) offered an amendment (S. Amt. 4371) to the bill that would extend the COBRA premium subsidy program through November 2010. In urging approval of his amendment, Casey stated that “[w]ithout the extension of the COBRA Premium Assistance Program, a report from the National Employment Law Projects predicts as many as 150,000 Americans each month will lose out on the subsidies necessary to afford quality health care.” At this point, however, the fate of the tax extender bill – and its amendments – is unclear.