UPDATE: Third Way responds with a statement to HuffPost:
Third Way is committed to helping the President and Congress succeed in enacting meaningful and comprehensive health care reform.
Currently one of the most discussed aspects of the President's reform effort is a public plan option. In a draft Third Way memo that has been widely circulated and mis-characterized, we propose a number of policy ideas that would help ensure that a public plan is crafted in an effective way -- and can garner the votes needed to advance broad health care legislation.
There is an urgent need for real health care reform in America. Health care in our country has not worked for average Americans: it is too easy to lose coverage, it is too easy to see premiums rise, it is too easy to be denied access to care. Third Way's latest report found that only 64% of working age Americans have had the high standard of health care coverage: 4 years of uninterrupted private health care.
That is a crisis.
That's why we need health reform that provides stable coverage, stable cost and reliable, quality care for all Americans.
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A health care policy statement causing an uproar among progressives was drafted by three policy analysts, one of whom has longtime connections to the health insurance industry.
The paper, which surfaced on Monday, is written by the organization Third Way and rejects calls for a public health care option that would be available to anyone and would compete with private insurance on the grounds that it would be divisive and undermine broader reform goals. Instead, the group calls for a "hybrid plan" that would only be available to "those employed in small businesses with 10 employees or less, those in the individual market, and those who lack insurance. Another option might [be] to limit the geographic scope of the plan in its initial phases until its worth is demonstrated." The position would be unsurprising coming from the insurance industry, which strongly opposes a public option. But Third Way is nominally a liberal organization and claims allegiance to progressive politics.
The three authors are Jim Kessler, Anne Kim and David Kendall. Kendall is a former consultant for the Blue Cross-Blue Shield Association, one of the most powerful insurers in the nation. He is on the board of directors for the Wye River Group on Healthcare, which is funded to the tune of a million dollars by CIGNA, a major health insurance player. Kim is a former corporate attorney with Hogan and Hartson, a top health care industry lobby shop, and Cleary, Gottlieb, Steen and Hamilton. She also formerly helped write policy for the Blue Dog Coalition, which last week issued a statement of principles opposing a public option without a "trigger." Third Way spokesman Sean Gibbons said that Kim did not work on health policy issues while at Hogan and Hartson.
Gibbons said that Kendall was "not the principal" drafter of the memo and that Kim and Jim Kessler, a Third Way founder, took the lead.
In 1991, according to his bio on the Wye River website, Kendall "helped set the stage for the national health care reform debate by bringing to Washington, D.C. the idea of managed competition, a theory developed by the Jackson Hole Group to achieve universal health care coverage through private health plans. He co-created the Jackson Hole East Group to foster discussion and political interest in managed competition."
Progressives have reacted with fury at Third Way's insertion of itself into the health care debate. Adam Green at OpenLeft.com wrote that if the draft paper becomes the official position he'll work to defund the organization, saying of Third Way: "Enough."
Kim and Kendall did not return calls left on their Third Way voice mail.
Gibbons stressed that the memo was simply a draft and that Third Way is "constantly evolving our thinking."
"This is a draft memo," he said. "We're looking at our position...Think tanks right memos. We do dozens of drafts. This is just one of them and we are an ally in the health care reform fight. There should be no confusion about that."