White House seeks health plan compromise
By Ricardo Alonso-Zaldivar, Associated Press Writer
April 15, 2009
WASHINGTON -- President Barack
Obama's top health care adviser said Wednesday a compromise is
within reach on a government health plan for the middle class
that wouldn't drive private insurers out of business.
Offering the option of government coverage to workers and their
families has become one of the most contentious issues in the
debate about overhauling health care to cover the uninsured and
curb costs. Obama has proposed a public plan, and liberals
insist it be part of any final deal. Conservatives and
businesses fear that could open the door for a government
takeover of the system.
Nancy-Ann DeParle, director of the White House health reform
office, said a public plan could be designed to address concerns
about the federal government overreaching in its role.
"I'm actually very hopeful that we'll be able to reach an
agreement on that, because it is part of the president's plan,"
DeParle said in a session with reporters at which she fielded
repeated questions on the issue. "It's included because he
wanted a mechanism to lower costs and to keep the private sector
But the insurance industry remains skeptical, and many
Republicans say any kind of public plan would be a deal breaker.
DeParle suggested one compromise might be that the public plan
pays hospitals and doctors rates similar to what private
insurers pay. That would address fears that government would use
its muscle to pay rock-bottom prices for medical services,
allowing the public plan to charge discounted premiums that
private insurers couldn't compete with.
Even if the government plan paid private-market rates to doctors
and hospitals, it could still cut costs, DeParle said. A
government plan wouldn't have to turn a profit, and could also
save on administrative expenses.
"If it's a policy disagreement, there are ways of bridging that
gap," said DeParle.
However, DeParle acknowledged that ideological objections to
government's role would be hard to overcome. She spoke at a
forum sponsored by the Kaiser Family Foundation.
Most Americans may not realize it, but government already pays
nearly half of the nation's health care tab. Government programs
cover seniors, poor families, and many children. Obama has
proposed to expand that.
His plan would offer middle class workers and their families the
option of enrolling in a public plan, along with private
insurance, through a new kind of purchasing pool. But Obama has
avoided filling in the details, thereby giving himself some room
Those details would be critical, according to a recent economic
study. The Lewin Group, a consulting firm, found that a public
plan would help to significantly reduce the number of uninsured.
But depending on how it's designed, it could also take away much
of the business from private insurers.
If a public plan was open to all employers and individuals, and
paid doctors and hospitals the same low rates as Medicare, it
would become the dominant insurer in the country, the study
found. But if the plan were open only to individuals and small
businesses, and paid rates similar to private insurers, its
impact would be limited. In that case, the public plan would
mainly be helping groups that now have a hard time getting
Lewin is a subsidiary of UnitedHealthcare, the nation's largest
health insurer. The consulting firm says it makes its own
judgments, however, and its work is used by groups on all sides
of the health care debate. For example, Lewin recently did a
study for the Commonwealth Fund, a New York-based research
center that released a health care proposal featuring a strong