Senators look for way to finesse healthcare public option

Under the healthcare public option plan being fashioned by Senate liberals and moderates, private nonprofit insurance plans would have to meet standards comparable to the options now offered federal employees.

By Peter Grier, Staff writer / December 8, 2009

Senate Majority Leader Harry Reid (D-NV) talks to reporters about healthcare legislation after the senate Democrats' weekly policy lunch at the Capitol in Washington, Tuesday.

Jonathan Ernst /Reuters

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It might be a public option in name only. But it could be a way around one of the most difficult obstacles facing Democratic leaders as they try to push healthcare reform legislation through the Senate.

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Under pressure from Senate majority leader Harry Reid of Nevada, a group of 10 senators – five moderates and five liberals – on Tuesday were close to producing a compromise over the divisive issue of a government-run health insurance program, or public option.

Their idea: Let the federal government give its seal of approval to private insurance plans that would be available across the country. To win Uncle Sam’s stamp, the new plans would have to meet standards comparable to the options now offered federal employees.

The plans would themselves have to be run on a nonprofit basis – though they could be offered by any insurer, including for-profit firms. They would be sold through the new state insurance markets, called exchanges, which the health reform legislation would establish.

“It’s probably the closest proposal thus far that could get the support of 60 senators. It’s got legs,” said Sen. Max Baucus (D) of Montana, chairman of the Senate Finance Committee.

Right now, the Senate bill includes provisions that would establish a government-run nonprofit choice for individuals and small businesses. States would be allowed to opt out of this network if they choose.

Liberals have insisted on the inclusion of a public option, seeing it as a way to pressure private firms to keep costs down. But moderates and conservatives have objected to it as too much government intervention in the private market.

The compromise might be the best way for Senator Reid to round up 60 votes. But it would be a public option that isn’t really public, and is an option for only a few.

Having woken up to this, some liberals are pushing for other changes in the bill as a price for losing the public option. They would like to allow people 55 and older to buy into Medicare if they wish, and to expand the Medicaid program, for instance.

Those changes are likely to be hotly debated – as the public option has been.

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