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Obama Health Care Plan Drops Public Option

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Despite the recent surge of support in the Senate for a government-run health insurance option, President Obama chose not to include one of the most popular elements of reform in the plan he is presenting to a bipartisan group of lawmakers Thursday.

The Obama plan explicitly bridges the differences between Senate and House legislation on issues both large and small, but on the public option -- which is included in the House bill, but not in the Senate's -- Obama is entirely silent.

Last week, Health and Human Services Secretary Kathleen Sebelius told MSNBC's Rachel Maddow that Obama would "absolutely" fight for a public option if Senate leadership decided to go for it. "[I]f it's part of the decision of leadership to move forward, absolutely," Sebelius said. "The president said from the outset he thought that was a great way to provide cost reduction and competition moving forward, but if that is not the choice of the majority moving forward, I think there are other ways to get there."

Since then, Senate Majority Leader Harry Reid (D-Nev.) said he would work with his colleagues to find the votes needed for it; Sen. Charles Schumer (N.Y.), the third ranking Democrat, pushed for it to be included; and Sen. Bob Menendez (N.J.), chairman of the Democratic Senatorial Campaign Committee, joined in the call as well.

But neither that nor the public option's consistently strong appeal in public-opinion polls was enough to persuade Obama to get behind it.

Indeed, after months of watching Obama say generally that he supports the public option while doing little to see it implemented into law, backers of the idea were unsurprised it was left out of his final offer.

"We didn't expect one," said Darcy Burner, head of the Progressive Caucus Policy Foundation.

Last week's surge had fired up a demoralized Democratic base, giving the health care reform effort an extra push as Obama tried to drag it across the finish line. But if the final bill is to include a public option, leaders in Congress and outside organizations advocating on its behalf will need to do it without Obama. "Congress and the people of the United States will have to lead in truly taking on the insurance companies," Burner said.

Obama's decision not to push for the public option does not preclude it from being included. Indeed, any member of the Senate can introduce it as an amendment to a package moving through under the rules of reconciliation, a parliamentary process that precludes a filibuster.

UPDATE: 10:15 -- Jacob Hacker, the Yale professor credited with original idea of the public option, told HuffPost in an e-mail that he is glad that the president is pushing forward with reform. He said Congress should follow a path he calls "Pass, Pledge, and Promise," whereby it passes an amended health care reform bill and promises to include a public option at a later date, if it becomes impossible to do immediately. Hacker's response:

The President should be commended for moving the stalled debate forward. His blueprint improves a number of the weakest elements of the Senate bill, including the subsidies for middle-class Americans receiving coverage through the exchanges and the protections against high cost-sharing under these plans. Notably, he includes stronger consumer protections for so-called grandfathered plans--employment-based plans existing at the time the law takes effect (which would have been only weakly regulated under the Senate bill). He has also broken important new ground by proposing to create a way to review health insurers' egregious rate increases, a step whose urgency has been driven home by the Anthem rate hikes in California.

Even more important than any of these specifics is that the President is signaling he will engage fully in making reform happen and stand fully behind the members of Congress as they seek their own compromises. In this week's summit and the days that follow, the White House needs to stand strongly for the middle class and press for simple, understandable, effective, and popular steps.

For my part, I believe this strategic and policy advice recommends a path I call "Pass, Pledge, and Promise" (a variation on Senator Franken's "Pass and Pledge"): pass the Senate bill in the House, fix it with a pledged reconciliation bill, and promise to enact a public option -- now or, if now is impossible, in the near future. The beauty of the "promise" part is that a public option would be a big initiative on behalf of the middle class that would actually save the federal government serious money--at least $25 billion, and potentially much more than that, depending on how it is structured. Amid all the attacks on the public option, it has remained remarkably popular, and for a simple reason: It sends an unmistakable message that politicians are on the side of citizens rather than insurers.

UPDATE: 10:27 -- FireDogLake.com's Jane Hamsher tells HuffPost that including a proposal by Sen. Dianne Feinstein (D-Calif.), which would regulate rises in insurance premiums, isn't serious because it would likely violate the "Byrd rule" -- in other words, it would be ruled out of order if it was introduced as an amendment to a bill under reconciliation, because it doesn't have a direct connection to the deficit.

The Senate, however, could vote to overrule the parliamentarian, putting Republicans on the spot. Broadly, said Hamsher, claims that Obama backs a public option ring hollow if he doesn't get behind it when it matters. "This morning, Dan Pfeifer said the President still 'supports' a public option. How can Obama possibly claim to 'support' something if he doesn't include it in his own plan?" she asked. "It's incredibly cynical to include the Feinstein Health Insurance Rate Authority in order to try and control spiraling costs, which is unlikely to survive the Byrd rule, and exclude the public option, which could be included and actually does achieve cost control. This game of pretending to do one thing while actually doing another continues to erode public confidence about the administration's true goals."

Adam Green of the Progressive Change Congressional Committee, which has been pushing hard for the public option, said that the PCCC, Credo Action and Democracy for America will be releasing a petition that tells Congress: "Americans want a good health care bill with a public option, even if it passes with only Democratic votes. We would rather have a good bill than a bipartisan one."

Polling shows that voters would rather have a strong bill than a bipartisan one.

"The White House is asking Democrats in Congress to shoot themselves in the foot in the name of bipartisanship. Congress would be wise to smile nicely at the White House and then pass the public option through reconciliation and win re-election," said Green.

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