Public option fails in Senate committee

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Democratic efforts to include a taxpayer-financed “public” health insurance option in the emerging health reform bill fell short in two crucial test votes in the Senate Finance Committee on Tuesday afternoon.

The first proposal, offered by Sen. John D. Rockefeller IV, West Virginia, failed on a 15-8 vote, opposed by all of the committee’s Republicans as well as by Sen. Max Baucus, Montana Democrat who is committee chairman, and fellow Democratic Sens. Kent Conrad of North Dakota, Blanche Lincoln of Arkansas, Thomas R. Carper of Delaware and Bill Nelson of Florida.

A second try on a more limited public-option amendment from Sen. Charles E. Schumer, New York Democrat, designed to attract farm-state Democrats, failed by a closer margin of 13-10, with Mr. Baucus, Mr. Conrad and Mrs. Lincoln joining the Republicans in opposition.

Related TWT article: Health: The Dems in a circular firing squad

The two votes were a tactical victory for Mr. Baucus, who is trying to craft a compromise plan that can ultimately pass the full Senate. He long has said that the public option doesn’t have the 60 votes required to defeat a minority filibuster.

“I fear that if this provision is in the bill, if it comes out of this committee, it will jeopardize real, meaningful health care reform,” he said.

But liberal Democrats in both the House and Senate have pushed for the public option as central to their drive to expand health insurance coverage and provide competition for private insurers.

“It would simply guarantee that there is one health insurance plan in the exchange … that ordinary Americans can afford and can count on for [cheaper] premiums,” Mr. Rockefeller said. “It’s stable. It’s affordable. I believe it saves [the federal government] $50 billion.”

But the Senate Finance Committee votes are hardly the end of the fight.

Mr. Schumer and Mr. Rockefeller said they expected their proposals would have a hard time passing the finance panel. Their arguments will lay the groundwork for similar pushes when the health reform bill reaches the floor of the Senate, where the amendments have a better shot at passage.

Democrats argued that the nonprofit public insurance plan merely would be an option to consumers, who would not be forced onto the program, but that its presence would help force insurers to compete.

Mr. Rockefeller, a longtime insurance industry critic, said insurers have been able to skirt regulations for too long and that the public plan was the only way to force them to comply.

He was highly critical of what he said were $463 billion in tax subsidies in Mr. Baucus’ proposal, which would be available to consumers to help them purchase insurance. He said that the subsidies will go “directly” to insurance companies.

“If we don’t [establish a public plan], what we’re saying is, ‘Go ahead, health insurance companies, and make more profits,” he said.

Republicans countered that the public plan would not reimburse doctors enough to make up for their costs, forcing them to charge patients on private insurance more and eventually drive the private companies out of business.

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