Senate Panel Bipartisan Compromise May Drop Public Option

A bipartisan group of Senate negotiators led by Finance Chairman Max Baucus (D-MT) is signaling that a final Senate healthcare reform package may not include a government-run public option.

The news is generally portrayed as a setback for President Obama, who has pushed for a public option. The ongoing negotiations are also portrayed as creating difficulties for the White House, which is seen as caught between conservative Democrats and more liberal lawmakers.

ABC World News (7/28, Karl) reported that "Senate Democrats are now on the verge of a deal that would do away with a central feature of the President's plan, and that's the creation of a government-run insurance program to compete with private insurance companies. They're doing this to break that gridlock and to get a few Republicans to support the deal. But there's a real risk that they're going to lose liberal Democrats in the process."

The AP (7/29, Babington) says "bipartisan Senate negotiators are weakening some of his top priorities, leaving the president with a difficult choice: He can give ground, and implore disappointed liberals to go along with him. Or he can try to ram through a Democratic bill with his wishes intact, infuriating Republicans." Obama's "eventual decision could be a pivotal moment in his presidency."

White House adviser David Axelrod said it's too early for Obama to fully endorse the Senate Finance Committee's bipartisan approach or the liberals' call to stand firm." Axelrod said, "This is the legislative process. ... The important thing is to keep the process moving forward. ... Everyone is going to have to give a little to get there."

The Hill (7/29, Bolton, Young), meanwhile, reports that White House press secretary Robert Gibbs "said the administration would 'certainly take a look at' the co-op idea, but said it was 'a little premature' to talk about reconciling the two conflicting bills." Gibbs added that "Obama is 'comfortable with the path this is going on.'"

McClatchy (7/29, Lightman, Douglas) similarly reports that the idea of a public option, "beloved by...Obama and liberal Democrats," is "losing important political momentum. Democratic leaders of the Senate and the House of Representatives wouldn't guarantee Tuesday that the 'public option' would be in the final version of the legislation. Neither chamber's leaders would rule out backing alternative co-ops -- member-run healthcare consortiums comparable to credit unions -- instead, an alternative that's popular with moderates but not with liberals."

The Los Angeles Times (7/29, Levey, Hook) notes that Senate Democrats "are moving toward a showdown" over the public option. Many Democrats "have indicated they would settle for nothing less" than a public option, but the Finance negotiators are "leaning toward cooperatives, saying that alternative could offer customers more choice without enlarging the government's role in the healthcare market."