Obama notes progress, reiterates support for public insurance plan

"President Barack Obama on Tuesday welcomed progress on health care overhaul as top Senate Democrats and the administration closed in on a deal with hospitals to help pay for the president's proposed expansion of medical coverage to the uninsured," The Associated Press reports.

The White House released a statement in which "Obama said he was pleased with the progress and reiterated his support for creation of a government-run plan to compete with private insurance. 'One of the best ways to bring down costs, provide more choices and assure quality is a public option that will force the insurance companies to ... keep them honest,' he said" (Espo, 7/7).

The White House statement came after an interview with White House Chief of Staff Rahm Emanuel on Monday, in which Emanuel said that "'The goal [of health care legislation] is to have a means and a mechanism to keep the private insurers honest. … The goal is non-negotiable; the path is' negotiable," The Wall Street Journal reports. "Mr. Emanuel said one of several ways to meet Mr. Obama's goals is a mechanism under which a public plan is introduced only if the marketplace fails to provide sufficient competition on its own" (Meckler and Adamy, 7/7).

Dow Jones Newswires adds that "managed-care stocks gained Tuesday following indications that the White House is open to a public health-insurance plan that would be introduced only if the marketplace fails to provide sufficient competition on its own."

"The sector has been volatile in the past few months due to uncertainties over how health-care reforms would affect the industry." But an industry analyst said "she likes the proposal for a fall-back trigger public-plan option for health insurance, adding that as long as competition remains strong, the likelihood that the public plan would be triggered is very low (Cummings, 7/7).