House health bill to include public plan, insurers resisting

On Monday, House Ways and Means Committee Chairman Charles Rangel, D- N.Y., told reporters that the House bill will include a new public insurance plan, Reuters/The Boston Globe reports.

"Similar to legislation being developed in the Senate, the House bill would establish an insurance exchange to help people without employer-sponsored insurance find medical coverage." The government-sponsored public insurance plan would be "one of the options available, lawmakers said." The bill would also establish a mandate that would "require individuals and businesses to obtain coverage."

A government-sponsored public health insurance option remains one of the most contentious points in the health care debate. On Monday, Senate Republicans sent a letter to President Barack Obama "arguing against a new public plan, saying it would lead to 'a federal government takeover of our healthcare system.'" The President called for a public plan option last week "but also has said he wants healthcare legislation by October that enjoys bipartisan support." House Democrats will be briefed on the new legislation today, and Democratic members of the Ways and Means Committee are also scheduled to meet with Obama "to discuss the proposal" (Smith, 6/8).

Meanwhile, GOP lawmakers in both houses, and some moderate Democrats, are voicing opposition to the inclusion of a government-run insurance plan: "[T]he dust-up may turn the once amicable health care debate into a partisan war," reports Utah's Salt Lake Tribune.  Sen. Orrin Hatch, R-Utah, a Finance Committee members, say the unraveling bipartisanship isn't cut in stone: "I would be glad to help them, but not with a public plan" (Canham, 6/8).

And Democrats are actively recruiting GOP Senators who might help, even with the public plan, USA Today reports. Maine Republican Senators Susan Collins and Olympia Snowe, the only current Senate Republicans who defected to support Obama's stimulus plan, are possible supporters. "'There is more outreach… to Republicans than was the case during the early days of the stimulus,' Collins said.

"If Democrats want Republican support, they will probably need 60 votes, the threshold required to stop filibusters and proceed to a final vote," USA Today reports. "Democrats can count on 59 votes, but it is not clear whether all Democrats will vote for whatever proposal emerges," making it critical for Democratic leaders to assure support by moderates in their own party, like Sens. Evan Bayh, D-Ind., and Ron Wyden, D-Ore. Liberal advocacy groups are currently run ads in both Maine and Oregon to shore up support for reform (Fritze, 6/9).

The insurance industry "is maintaining a conciliatory tone, while making clear its objections to such a plan, as it tries to shape" a health care overhaul, Dow Jones Newswires/CNN Money reports in a story headlined: "Health Insurers Aim To Shape Reform, Resist Public Plan." Insurers say "a public plan won't be needed if reformers successfully expand coverage to the uninsured through mandated insurance and guaranteed issuance of policies, find ways to control medical costs, prohibit exclusions for pre-existing conditions, and provide subsidies to help people afford coverage." Bill Hoagland, Cigna Corp.'s vice president for public policy and government affairs, told Dow Jones "the question we have to raise is, 'Wait a minute, if the industry agrees to do all of that, what is it that a public plan achieves?'" He says the insurance industry has "stepped up, Cigna has stepped up we've tried to be good players." This is a major change from the Clinton health care debates, Hoagland says, when insurers took "the Harry-and-Louise position against reform."

Hoagland says the problem with a public plan is "you end up having a significant cost shift from public plans to the private plans," because of the lower reimbursement rates that government-run plans such as Medicare pay providers. Elizabeth Hall, WellPoint Inc.'s vice president for public policy, said the plan could be "very disruptive to the marketplace," but "she wasn't ready to call the issue a deal-breaker. "We are definitely not supportive of that, but I think just like any other large piece of legislation, we are going to have to take it as a whole," Hall says (Brin, 6/8).