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Finance Committee Shuns Public Option in Overhaul

By Jane Norman, CQ HealthBeat Associate Editor

September 29, 2009 -- Given the tenor of the nearly five hours of passionate arguments on the public option in the Senate Finance Committee on Tuesday, you'd think a close vote was on its way.

Not the case. Senators on a rare bipartisan 8–15 vote turned down the idea of including a government-sponsored plan in the health overhaul bill, with Chairman Max Baucus, D-Mont., leading the majority in what could be a turning point in the push to finish the committee's work. He brought four more Democrats along with him to oppose the public option, joining all 10 Republicans.

Baucus voted no again a little while later on a second amendment on the public option, this one finishing somewhat closer on a 10–13 vote. It was anticlimactic, since the committee's temperature already had been taken—but it did show that two more Democrats could be brought along to back a public option in some form, Thomas R. Carper of Delaware and Bill Nelson of Florida.

Baucus, who has been under intense pressure, including ad campaigns from liberal groups to back a public option, said he had to face reality. At the close of the debate on the first public option amendment, this one sponsored by Sen. John D. Rockefeller IV, D-W.Va., Baucus said he wants consistency and coherence in the nation's disjointed health care system.

But his job is to put together a bill that has a chance of winning 60 votes on the floor of the Senate, he said.

"I can count," said Baucus, "and no one has shown me how they can count up to 60 votes with the public option in the bill."

He said he agrees that including a government plan strongly supported by liberal colleagues likely would "hold insurance companies' feet to the fire." But "my first job is to get this bill across the finish line," Baucus said, and the drive to expand insurance to millions more Americans has to be his priority.

While it's been clear for some time that the public option doesn't spark much excitement among Senate Democrats, the vote in the Finance Committee was the first concrete sign that the concept has a ways to go in gaining widespread support.

The committee's move means the bill appears ready to be voted out of the committee without the public option set up to compete with private insurance companies in the exchange system, and instead with a plan for nonprofit, consumer-owned cooperatives pushed by Sen. Kent Conrad, D-N.D., and harshly criticized by liberals.

Meanwhile, the new chairman of the Senate Health, Education, Labor and Pensions Committee, Democrat Tom Harkin of Iowa, said on "The Bill Press Show" that he believes close to 50 Democrats in the Senate back the public option.

"Why shouldn't we have a public option? We have the votes," said Harkin, who also said that he believes there are 60 votes to counter a Republican filibuster on the overhaul.

Harkin's committee has approved its version of the bill with a public option, so the two bills will have to be combined. Carper said in an interview on CNN that he believes some kind of hybrid public option will emerge, perhaps with a trigger mechanism in markets that lack competition, an idea suggested by Sen. Olympia J. Snowe of Maine, a Republican viewed as a key swing vote in the overhaul debate. Snowe opposed both public option amendments.

In the House, liberal Democrats are strongly supportive of the public option, but leaders there indicated in a meeting with reporters that its makeup remains under discussion. House Majority Leader Steny H. Hoyer, D-Md., who's said he doesn't want to see the overhaul fail for lack of a public option, said that "the issue is how it's configured. And we're in the process of discussing that."

House Speaker Nancy Pelosi, D-Calif., said members want to control costs and the public option would have that effect. She also pointed out that all three House committees and the Senate HELP Committee have approved legislation that includes a public option.

"We're building consensus now. I'm confident that, as we go forward in the House we will reach a strong consensus with a bill that lowers cost, improves quality, expands coverage and retains the choice that people value now," said Pelosi.

Under Rockefeller's amendment, a voluntary "Consumer Choice Health Plan" would have been added to the bill and available to all individuals and businesses purchasing insurance through the national exchange. For its first two years of operation, providers who participate in Medicare would be required to also participate in the public plan. Rockefeller said a Congressional Budget Office analysis found it would save $50 billion over 10 years.

Rockefeller said polls of the public and of doctors have found widespread support for the public option to keep a check on "rapacious" health insurers. "We need this option because insurance companies have failed to meet their obligations," he said. "Insurance companies, in my view, are determined to protect their profits." The people he represents in West Virginia "need this because they are helpless in the face of insurance companies," said Rockefeller.

This produced a reaction from Nelson, who eventually split his votes on the public option amendments, that as a former state insurance commissioner he was becoming "very sympathetic" to the arguments from Rockefeller.

However, Baucus objected that "the implication is the mark is easy on the insurance industry, and it's not." He pointed out that insurance market reforms he has included would, among other things, require that insurance companies sell policies to those who seek them and allow them to renew them as often as they want.

"They have never followed the rules," replied Rockefeller. "They just have not done it."

Sen. Charles E. Grassley of Iowa, the ranking Republican on the committee, took advantage of the situation to fire back at White House officials who he said have accused him of not clarifying his opposition to the public option. Grassley, who at one time was a member of the "gang of six" negotiators seeking a bipartisan bill, cited three occasions on which he said he made his opposition clear to the Obama administration.

Grassley discounted polls showing majorities in favor of the public option. "It kind of depends on how you ask the question," he said. And he repeated a longtime GOP argument that the public option is the opening to a single-payer system for the country. "If you support government bureaucrats, not doctors, making medical decisions, you should vote for this amendment," said Grassley.

Democratic Sen. Charles E. Schumer of New York needled Grassley, asking if he thought Medicare was a good program. "What you're arguing in terms of public option is we shouldn't have Medicare at all," he said. "That's not what people want. They like Medicare and they want the option of Medicare Advantage. Your arguments all say don't have Medicare because it's a government-run plan."

Grassley said "the government is not a fair competitor, it's not even a competitor—it's a predator." He said that Medicare is part of the "social fabric of America" that can't be changed and the legislation makes some important corrections needed in the program. "Giving people choice is very, very important and this is going to kill choice," he said.

Looking on during the Schumer-Grassley exchange was Sen. Orrin G. Hatch, R-Utah, who like several other senators seemed happy to have the public option issue hashed out in public view. "I've enjoyed this," he said, before launching into his own remarks on the "perils" of the public option.

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