In a long-awaited fight that pitted Democrats against one another, liberal lawmakers failed twice Tuesday to insert a government-run health insurance program into the emerging Senate health care reform bill but vowed that the battle for a public option is far from over.
Republicans immediately hailed the Senate Finance Committee showdown votes as proof that the public option was dead. But the White House said the panel’s slow slog to produce a bill was building momentum for reform on Capitol Hill, with four other House and Senate committees already having approved versions of the bill.
White House press secretary Robert Gibbs said, just a few weeks earlier, “We didn’t have a committee that was meeting, we didn’t have amendments that were being debated, we didn’t have votes taking place.
“Obviously, all of that happening with the last committee of jurisdiction means we’re making progress on health care,” he added.
Chairman Max Baucus of Montana and fellow Democratic Sens. Kent Conrad of North Dakota, Blanche Lincoln of Arkansas, Thomas R. Carper of Delaware and Bill Nelson of Florida joined committee Republicans in a 15-8 vote to defeat an amendment by Sen. John D. Rockefeller IV, West Virginia Democrat, for an expansive public option plan.
A second try on a more limited amendment, offered by Sen. Charles E. Schumer, New York Democrat, failed by a closer margin of 13-10, with Mr. Baucus, Mr. Conrad and Mrs. Lincoln again in opposition.
The votes were a tactical victory for Mr. Baucus, who has struggled to craft a bill that could be voted out of his committee and have a chance of passing the full Senate. He has long said that the public option doesn’t have the 60 votes required to defeat a minority filibuster in the Senate.
“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.
Republican leaders said the vote proved that deep cracks are emerging among Democrats on the entire push for health care reform, and warned against efforts by the majority to ram a plan through Congress.
“Today’s bipartisan rejection of a government-run, taxpayer-funded health care plan by the Senate Finance Committee should serve as yet another indication it is time for Democrats to hit the ‘reset button’ and start over on health care reform,” said House Minority Leader John A. Boehner, Ohio Republican.
Speaker Nancy Pelosi of California and other House Democratic leaders said Tuesday that the House is on track to pass a bill with a clear public option, despite reservations from conservative Democrats in the chamber.
“Frankly, I think a very significant majority of Democrats in the House of Representatives are OK with a public option,” House Majority Leader Steny H. Hoyer of Maryland told reporters after a caucus of House Democrats. “The issue is how it is configured, and we are in the process of discussing that.”
Democratic supporters of the public option argued that the nonprofit public insurance plan would merely be an option to consumers, who would not be forced into the program. The option, they said, would force insurers to compete.
“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,” said Mr. Rockefeller. “It’s stable. It’s affordable.”
But moderate and conservative Democrats have been skeptical of the program’s cost, its impact on rural health care providers and its political prospects in the full Senate.
Supporters insisted that the committee votes did not spell the end of the public option.
Mr. Schumer and Mr. Rockefeller said they expected their proposals would have a hard time passing the relatively conservative Senate Finance Committee. With Senate Majority Leader Harry Reid of Nevada now charged with preparing the final draft of the bill, the two Democrats said a public-option amendment may have a better shot at passage on the Senate floor.
“This was the toughest terrain for us - the Senate Finance Committee,” Mr. Schumer told reporters after the votes. “It gets easier on the Senate floor and then it gets easier still in conference” with House negotiators.
Mr. Rockefeller, a longtime critic of the insurance industry, said private 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 also highly critical of $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.
But Democrats are far from unified on the issue.
Lawmakers from largely rural states are skeptical of any public plan that reimburses doctors and hospitals at Medicare rates, which vary by geographic region and are lowest in rural areas. They argue that the low rates, which providers offset by overcharging private insurers, could drive hospitals in their states out of business.
“I can’t possibly support an amendment that does that,” Mr. Conrad said.
Republicans argued that the public option would not reimburse doctors enough to make up for their costs, forcing them to charge patients on private insurance more and eventually driving the private companies out of business.
“I believe this is a slow-walk to government-controlled, single-payer health care,” said Sen. Charles E. Grassley of Iowa, the top Republican on the panel.
After the vote, the White House repeated Mr. Obama’s position that the public option is “a good way” to meet his goals of expanding coverage and lowering costs.
But the president remains open to “other constructive ideas of increasing choice and competition.”
Also on Tuesday, the committee knocked down a Republican proposal to limit the health care research in the bill out of concerns that it would lead to rationing. In its first unanimous roll call vote, the committee narrowed the Medicare pay disparity between rural and urban health care providers.
• Matthew Mosk contributed to this report.