Co-op compromise gives White House a health option

[June 15, 2009]  WASHINGTON (AP) -- As Congress begins work on putting President Barack Obama's goal of universal health coverage into law, administration officials and allies sought to sidestep an unpopular tax on existing benefits and Republicans' objection to a government competitor to private plans.

Cabinet officials and Obama allies on Sunday sought to rein in lawmakers, who were expected this week to introduce specific plans that run counter to Obama's political promises. Many urged lawmakers to consider a cooperative program that would expand coverage to the 50 million uninsured Americans with taxpayer support without direct governmental control.

The concessions could be the smoothest way to deliver the bipartisan health care legislation the administration seeks by its self-imposed August deadline, officials said.

"There is no one-size-fits-all idea," Health and Human Services Secretary Kathleen Sebelius said. "The president has said, 'These are the kinds of goals I'm after: lowering costs, covering all Americans, higher-quality care.' And around those goals, there are lots of ways to get there."

Some of those ways, though, run counter to the White House's earlier positions and Obama's own political base. While supporters from Obama's left have advocated a government-run option -- championed by an ailing Sen. Edward M. Kennedy, D-Mass., and his surrogate, Sen. Chris Dodd, D-Conn. -- presidential aides and congressional leaders in both parties have sought a speedy compromise.

Leading that pack: the cooperative approach, similar to rural utilities that have government financial support but operate independently. Sen. Kent Conrad, the North Dakota Democrat who chairs the Budget Committee, has offered the co-op idea as a way to avoid a bruising and protracted political wrangle on Capitol Hill.

"This really isn't, to me, a matter of right or wrong," Conrad said. "This is a matter of: Where are the votes in the United States Senate?"

That political situation has guided most of the talks. While Democrats control both chambers of Congress, they have only 59 senators -- one short of the number needed to end a Republican filibuster. Even if Al Franken were seated as Minnesota's second senator, Kennedy and Sen. Robert Byrd, D-W.Va., are suffering health problems that could preclude them from casting votes to end the procedural delay.

"I think you are in a 60-vote environment. And that means you have got to attract some Republicans, as well as holding virtually all the Democrats together," Conrad said. "And that, I don't believe, is possible with the pure public option. I don't think the votes are there."

To offset the numeric challenge, Conrad proposed a compromise that drew interest from moderate Republicans, including one who helped Obama pass his economic stimulus plan over GOP objection.

"It's far preferable to the government-run plan that has been discussed by the administration," said Sen. Susan Collins, R-Maine. "We need to better understand how it would work. But it's certainly better than a Washington-run plan."

Obama's political team at the White House has seen such a compromise as an option, although publicly the administration remains in support of a government competitor to private insurance. But during appearances on Sunday news programs, the support seemed to waver.

Sebelius said "having these ideas on the table is exactly where we need to be right now." And Vice President Joe Biden indicated the White House was ready to accept that "a public plan is on a continuum."

Biden tried to reframe the question: "So the question is, what is the public plan?"

The answer for Republicans: Unacceptable.

"I think that, for virtually every Republican, a government plan is a nonstarter," said Senate Minority Leader Mitch McConnell, R-Ky. "There are a whole lot of other things we can agree to do on a bipartisan basis that will dramatically improve our system."

To reach that bipartisan solution -- something the White House has emphasized -- Democrats were likely to make concessions to find the $1 trillion the plan would cost over the next decade.

One way to get there would be to tax health benefits for families whose coverage costs $15,000 a year or more in premiums paid by employer and employee combined. Obama personally opposes the move, which is politically unpopular and was one of his top criticisms of his Republican rival, Sen. John McCain, during last year's presidential contest.

"It looks like he's looking at doing similar to what McCain wanted to do, and I think for the benefit of making this bipartisan, presidential leadership in this area would be very good based upon the tune of the last campaign," said Sen. Chuck Grassley, R-Iowa.

Incumbent lawmakers similarly opposed the tax, which would be panned as a tax hike during coming elections.

"The idea of talking about taxing benefits at a time people are overwhelmed, I think, is a very bad idea," said Dodd, who faces a tough re-election bid next year.

Sebelius appeared on ABC's "This Week" and CNN's "State of the Union." Conrad and Collins also appeared on "State of the Union." Biden appeared on NBC's "Meet the Press" while McConnell appeared on CBS' "Face the Nation." Grassley and Dodd were on "Fox News Sunday."

[Associated Press; By PHILIP ELLIOTT]

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.