Senate Panel Kills Public Option for Health Care Bill

The Senate Finance Committee, working through amendments to a sweeping health care overhaul, flatly rejected on Tuesday the concept of a “public option,” a government-run insurance plan for people who cannot find coverage privately.

In a long-anticipated showdown, liberal Democrats twice failed yesterday to inject a government-run insurance option into sweeping health care legislation taking shape in the Senate, despite bipartisan agreement that private insurers must change their ways.

By a 15-8 vote, the Finance panel first rejected an amendment sponsored by Senator Jay Rockefeller (D-WV,)  that would create a public health insurance option. All Republicans on the panel voted against Rockefeller’s amendment, in addition to five democrats including Senate Finance Chairman, Max Baucus (D-MT.)

Sen. Charles Schumer (D-NY) also offered another amendment yesterday that would create a public health insurance option, but would pay doctors and hospitals at negotiated rates, rather than Medicare rates. Schumer’s amendment also failed, with a 13-10 vote.

The committee is in the second week of debate on Baucus’s bill. The committee’s votes against the option underscore the depth of division among the leaders in the Democrat Party pressing for health care legislation. It also shows the strong and solid Republican opposition to an option that President Obama has promoted while conceding he is open to negotiation.

Rockefeller and Schumer say the public option is the best way to offer affordable insurance to people who don’t have it, but Senator Chuck Grassley (R-IA,) the panel’s top Republican, argued that, “over time the government plan will be the only viable option for most Americans,” and that will lead to “rationing or delay of care.”

The public option, however, remains an essential element to any legislation ultimately adopted in the eyes of some of the Senate’s Democratic leaders as well as House Speaker Nancy Pelosi (D-CA,) who has said the House cannot pass a health care bill without the government-provided choice.

Senator Baucus is pushing the legislation through his committee. He hopes to get a committee vote on his package by the end of the week. “My job is to put together a bill that gets to 60 votes” in the full Senate, Baucus said, before joining the majority on the committee in opposing the public option. “No one shows me how to get to 60 votes with a public option,” Baucus said.

Senator Charles E. Grassley (R-IA,) the senior Republican on the Finance Committee, stepped in to voice his party’s opposition to the idea of government-run insurance.

“A government run plan will ultimately force private insurers out of business,” Mr. Grassley said, adding that supporters of the public option were trying to open a back door toward a fully government-run, or single-payer, health system like those in Canada or England.

After yesterday´s votes in the Senate Panel, the true test will come in reconciling the Baucus bill with the health care bill the House of Representatives produces. Several House committees have passed similar bills (all containing a public option) but the full chamber has not yet voted.

As far as the Baucus bill, the Heritage Foundation has analyzed its costs. Under the Baucus plan, everyone will have to have health insurance by 2013. The mandate will apply to all adults and their dependents under age 18. Those who failed to buy insurance would be forced to pay an annual tax between $750 and $3,800.

Under the Baucus plan, employers with more than 50 employees that don’t offer health coverage would also have to pay a penalty for each employee who qualifies for new federal subsidizes under the bill. To stay in business employers will be forced to cut jobs and cut wages.

Also, the Baucus bill imposes higher taxes on manufacturers and importers of medical devices, health insurance companies, clinical laboratories, manufacturers and importers of drugs. In effect, the Baucus proposal would tax the sick to subsidize insurance for the healthy, and many of the taxes would be imposed on the same people “helped” by the subsidies.

Finally, the bill enforces both its individual and employer mandates by deputizing the Internal Revenue Service. To enforce these provisions, the bill would therefore require individuals, health insurers, employers, and government health agencies to report detailed health insurance information on all Americans to the IRS, adding significant administrative costs and reducing privacy protections.

The health care debate is becoming a nightmare for the Obama administration. A new Rasmussen Reports survey released on Monday shows the support for health-care reform proposed by the President and Congressional Democrats has sunk to a new low of forty-one percent (41%.)

The plan is now being opposed by 56% and supported by 41%. Seniors are most responsible for the low numbers, with only 33% supporting the bill and 59% opposing. In the 65 and over group, only 16% strongly favor the plan while 46% strongly oppose. Among all voters, 23% strongly favor it and 43% strongly oppose.

The Americano / Agencies

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