Negotiators consider public option in Senate bill

WASHINGTON - Senior Senate Democrats at work with White House officials on health care legislation are strongly considering a requirement for the federal government to sell insurance in direct competition with private industry, officials said Thursday, with individual states permitted to drop out of the system.

Liberals in Congress long have viewed such an approach, called a public option, as an essential ingredient of the effort to overhaul the nation's health care system, and President Barack Obama has said frequently he favors it. But he has also made clear it is not essential to the legislation he seeks, a gesture to Democratic moderates who have opposed it.

Sens. Ben Nelson, D-Neb., and Kent Conrad, D-N.D., said in separate interviews they had been told the plan was drawing interest in the private negotiations unfolding in an ornate room in the Capitol down the hall from the Senate chamber.

The final decision is up to Senate Majority Leader Harry Reid, D-Nev., who led a delegation of Democrats to the White House late in the day to discuss health care with Obama.

"I'm not part of those discussions. What I'm hearing is that this is the direction of the conversation," said Conrad, who supports an alternative approach under which nonprofit co-ops would compete with private industry.

"I keep hearing there is a lot of leaning toward some sort of national public option, unfortunately, from my standpoint," Nelson said.

The White House declined to comment.

Reid's office did likewise, and the Nevada Democrat left the White House without talking with reporters.

Several officials said no final decisions had been made about including the so-called public option into the legislation. In the extraordinarily complicated atmosphere surrounding health care, one possibility seemed to be that the idea of a public option was being given wide circulation to see whether it could attract enough support to survive on the Senate floor.

If not, it surely would be jettisoned beforehand, with liberals urged to accept something less or risk defeat of health care legislation. There is little margin for error among Obama's allies in the Senate as they confront nearly unanimous Republican opposition.

Democratic moderates are skeptical of allowing the government to sell insurance, concerned that it would mark an unwarranted federal intrusion into the private marketplace. And even if they agreed, it would raise questions of payment rates for doctors, hospitals and other providers.

Conrad, for example, has said repeatedly he could not accept a plan with payments tied to Medicare, the federal health care program for the elderly, because rates in North Dakota are too low to give doctors an incentive to treat additional patients.

The public option issue has been one of the most vexing of the yearlong effort by Obama and his Democratic allies in Congress to remake the nation's health care system.

Legislation taking shape in the House is also expected to include a public option, although it is unlikely states will be allowed to opt out.