The White House Surrenders, Publicly, on the Public Option

So, about that public option, the one that President Obama has insisted for months would “keep insurance companies honest” and bring down prices—forget about it.

Appearing on CNN on Sunday, Health and Human Services Secretary Kathleen Sebelius said that government-run alternative health insurance plan that many liberals see as a sacred element of any reform package is “not essential,” in the administration’s view.

Sebelius was asked specifically about the Senate Finance Committee, where a bipartisan group of six senators has been slowly cobbling together a less ambitious health care plan—one that is expected to call for private, nonprofit cooperatives in place of the public option that is included in rival Senate and House legislation.

“They’ve been more focused on a not-for-profit co-op as a competitor as opposed to a straight government-run program,” Sebelius said.  “I think what's important is choice and competition. And I'm convinced at the end of the day, the plan will have both of those. But that is not the essential element.”

Her comments were broadcast on the same morning that The New York Times published an op-ed on health care reform by Obama that, in its 1,206 words, didn’t even mention the concept of a public option. And they came a day after Obama told a town hall audience in Grand Junction, Colo., that “the public option—whether we have it or we don't have it—is not the entirety of health care reform.”

This would seem to align the White House with the Senate’s Democratic leaders, who originally favored a watered-down version of the public option—the “level playing field” concept first outlined by Chuck Schumer this spring—but who, in the last few weeks, have distanced themselves from it and moved toward acceptance of the co-op alternative.

As a result, it’s now thoroughly implausible that Obama will end up signing into law a health care bill that includes a public option. Yes, technically, the concept is still alive: It is included in the compromise package that House Democratic leaders put together with moderates from the Blue Dog Coalition a few weeks ago, and dozens of left-of-center House Democrats are threatening to vote against any legislation that doesn’t include a strong public option.

But with the White House and Senate leaders now acting in tandem, it seems the most that public option supporters can do now is derail health care altogether. They won’t be able to impose a public option. No doubt, this point will be impressed on them by the administration and its allies in the weeks and months ahead: We know you wanted the public option and you’re right in principle, but do you really want to be the ones to kill health care and sink the Obama presidency?

The question is whether they will see it this way. After all, it’s not entirely clear what the administration is gaining from abandoning the public option.

At best, they might pick up two or three Republican votes in the Senate—perhaps from Olympia Snowe or Mike Enzi, or maybe even Chuck Grassley (even though he shamelessly pandered to the “death panels” crowd last week). And it may help keep conservative Democrats like Ben Nelson on board.

But public-option supporters will counter that there was no need to accommodate Snowe and Grassley—not with 60 Democratic votes in the Senate. Instead of dealing away the public option, Senate leaders—and the White House—could  have insisted that all Democrats vote to end any Republican filibuster on the public option, while retaining their right to vote against the plan once the filibuster was killed.

Or they could have explored the reconciliation process, whereby a filibuster would be bypassed and only 50 votes would be needed to pass the public option.

The White House may be calculating that the headlines generated by making a significant concession will move the polls a little. Voters who generally favor reform but who have only a faint understanding of policy details and the Congressional process (most voters, in other words) have been put off by all of the noise they’ve been hearing recently. The news that Obama is scaling back his plans and irritating his base might strike these voters as somehow reassuring, even if they don’t actually understand what’s going on.

But, again, public option proponents have a counterpoint: A recent poll found that 72 percent of Americans support the idea of a government-run insurance option.

Even before this weekend, some on the left were griping that too much had already been dealt away—that a “pure” public option that would be available to all Americans and that would be empowered to negotiate radical rate reductions had been sacrificed for the much less ambitious “level playing field” concept. But others on the left insisted that the key was simply to have a public option in some form—that it could always be adjusted and expanded once it was created.

That argument now seems moot. The White House is fine with having no public option, as are the Senate’s Democratic leaders. The question now is whether the left will respond with resignation or revolt.   The White House Surrenders, Publicly, on the Public Option