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A Final Possibility for a Public Option Compromise

January 8, 2010 - by Donny Shaw

The public option is pretty much gone from the health care bills at this point. The Senate has shown that they neither have the 60 votes to pass one over Republican objections nor the will to pass one with the 50 votes they do have by using budget reconciliation.

But Igor Volsky at the Wonk Room is suggesting what sounds to me like a promising area for a compromise:

A national public health insurance option is unlikely to muster 60 votes in the Senate, but House Democrats could insist on including a provision in the final health care bill that provides start-up funds to states that choose to create state-based public options. The current Senate bill allows states to independently finance such programs. Offering government seed money, however, could entice more states to take up the venture and prove politically valuable to liberal Democrats facing a backlash for abandoning the provision. States like New York, California and Washington would likely establish such plans and their successes may motivate conservative states to also adopt the measure.

Just like the public option start-up money in the House bill, the state money would presumably have to be fully repaid over a number of years. The House bill would have provided $2 billion in start-up funds for the national public plan. The level of funds needed to start up a small state-based plan would be much smaller. The final bill could also include language like that in the House bill stipulating that, beyond the start-up funds, no more public money can be directed to the public option. You can read that language in the House bill here and here.

At this point, progressive Democrats in the House could certainly live with this. The big unanswered question: would Sen. Joe Lieberman [I, CT] or Sen. Ben Nelson [D, NE] block it?

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