White House May Drop Public Health Option

Bowing to Republican pressure and an uneasy public, President Barack Obama's administration signaled Sunday it is ready to abandon the idea of giving Americans the option of government-run insurance as part of a new health care system.

WASHINGTON (AP) - Bowing to Republican pressure and an uneasy
public, President Barack Obama's administration signaled Sunday it
is ready to abandon the idea of giving Americans the option of
government-run insurance as part of a new health care system.

(AP) Phoenix August 15, 2009

Facing mounting opposition to the overhaul, administration
officials left open the chance for a compromise with Republicans
that would include health insurance cooperatives instead of a
government-run plan. Such a concession probably would enrage
Obama's liberal supporters but could deliver a much-needed victory
on a top domestic priority opposed by GOP lawmakers.

Officials from both political parties reached across the aisle
in an effort to find compromises on proposals they left behind when
they returned to their districts for an August recess. Obama had
wanted the government to run a health insurance organization to
help cover the nation's almost 50 million uninsured, but didn't
include it as one of his three core principles of reform.


Health and Human Services Secretary Kathleen Sebelius

Health and Human Services Secretary Kathleen Sebelius said that
government alternative to private health insurance is "not the
essential element" of the administration's health care overhaul.
The White House would be open to co-ops, she said, a sign that
Democrats want a compromise so they can declare a victory.

Under a proposal by Sen. Kent Conrad, D-N.D., consumer-owned
nonprofit cooperatives would sell insurance in competition with
private industry, not unlike the way electric and agriculture
co-ops operate, especially in rural states such as his own.

With $3 billion to $4 billion in initial support from the
government, the co-ops would operate under a national structure
with state affiliates, but independent of the government. They
would be required to maintain the type of financial reserves that
private companies are required to keep in case of unexpectedly high

 "I think there will be a competitor to private insurers,"
Sebelius said. "That's really the essential part, is you don't
turn over the whole new marketplace to private insurance companies
and trust them to do the right thing."

Obama's spokesman refused to say a public option was a
make-or-break choice.

"What I am saying is the bottom line for this for the president
is, what we have to have is choice and competition in the insurance
market," White House press secretary Robert Gibbs said Sunday.

A day before, Obama appeared to hedge his bets. 

"All I'm saying is, though, that the public option, whether we
have it or we don't have it, is not the entirety of health care
reform," Obama said at a town hall meeting in Grand Junction,
Colo. "This is just one sliver of it, one aspect of it."

Lawmakers have discussed the co-op model for months although the
Democratic leadership and the White House have said they prefer a
government-run option.

Conrad, chairman of theSenate Budget Committee, called the
argument for a government-run public plan little more than a
"wasted effort." He added there are enough votes in the Senate
for a cooperative plan.

"It's not government-run and government-controlled," he said.
"It's membership-run and membership-controlled. But it does
provide a nonprofit competitor for the for-profit insurance
companies, and that's why it has appeal on both sides."

Sen. Richard Shelby, R-Ala., said Obama's team is making a
political calculation and embracing the co-op alternative as "a
step away from the government takeover of the health care system"
that the GOP has pummeled.

"I don't know if it will do everything people want, but we
ought to look at it. I think it's a far cry from the original
proposals," he said.

Republicans say a public option would have unfair advantages
that would drive private insurers out of business. Critics say
co-ops would not be genuine public options for health insurance.

Rep. Eddie Bernice Johnson, D-Texas, said it would be difficult
to pass any legislation through the Democratic-controlled Congress
without the promised public plan.

"We'll have the same number of people uninsured," she said.
"If the insurance companies wanted to insure these people now,
they'd be insured."

Rep. Tom Price, R-Ga., said the Democrats' option would force
individuals from their private plans to a government-run plan, a
claim that the nonpartisan Congressional Budget Office supports.

"There is a way to get folks insured without having the
government option," he said.

A shift to a cooperative plan would certainly give some cover to
fiscally conservative Blue Dog Democrats who are hardly cheering
for the government-run plan.

"The reality is that it takes 60 percent to get this done in
the Senate. It's probably going to have to be bipartisan in the
Senate, which I think it should be," said Rep. Mike Ross, D-Ark.,
who added that the proposals still need changes before he can
support them.

Obama, writing in Sunday's New York Times, said political
maneuvers should be excluded from the debate.

"In the coming weeks, the cynics and the naysayers will
continue to exploit fear and concerns for political gain," he
wrote. "But for all the scare tactics out there, what's truly
scary - truly risky - is the prospect of doing nothing."

Congress' proposals, however, seemed likely to strike
end-of-life counseling sessions. Former Alaska Gov. Sarah Palin has
called the session "death panels," a label that has drawn rebuke
from her fellow Republicans as well as Democrats.

Sen. Orrin Hatch, R-Utah, declined to criticize Palin's comments
and said Obama wants to create a government-run panel to advise
what types of care would be available to citizens.

"In all honesty, I don't want a bunch of nameless, faceless
bureaucrats setting health care for my aged citizens in Utah,"
Hatch said.

Sebelius said the end-of-life proposal was likely to be dropped
from the final bill.

"We wanted to make sure doctors were reimbursed for that very
important consultation if family members chose to make it, and
instead it's been turned into this scare tactic and probably will
be off the table," she said.

Sebelius spoke on CNN's "State of the Union" and ABC's "This
Gibbs appeared on CBS' "Face the Nation." Conrad and
Shelby appeared on "Fox News Sunday." Johnson, Price and Ross
spoke with "State of the Union." Hatch was interviewed on "This

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