Emanuel reassures Democrats on public insurance option

Jul 8 2009

"White House Chief of Staff Rahm Emanuel reassured House Democrats on Tuesday night that President Barack Obama strongly backs a government-run health insurance plan, seeking to quell a firestorm among liberals upset at Emanuel's comments in the Wall Street Journal that suggested such a plan could be delayed," Roll Call reports.

"Progressive Caucus Co-Chairwoman Lynn Woolsey (D-Calif.) warned Emanuel that he would lose the caucus' votes if the White House compromised on the issue and included a 'trigger' that could delay a public insurance plan indefinitely" (Dennis, 7/7).

In a separate article, Roll Call reports that also following Emanuel's remarks, "Rep. Raúl Grijalva (D-Ariz.), co-chairman of the 77-member Congressional Progressive Caucus, fired off a letter to President Barack Obama warning him against dropping a public insurance option from health care reform plans." Grijalva said he wanted "'to be crystal clear that any such trigger for a strong public plan option is a non-starter with a majority of the Members of the Progressive Caucus ... Moreover, I consider it unacceptable for any of the cost savings that you are negotiating with hospitals and other sectors of the health care industry to be made contingent upon a robust public plan option not being included in the final legislation'" (Bendery, 7/7).

Reuters: President Barack Obama "renewed support for a government-run health insurance plan on Tuesday" after Emanuel's remarks backing away from the public option were quoted in the Wall Street Journal. In a statement released while traveling in Russia, "Obama strongly endorsed the idea of a public plan and said it was one of the best ways to bring down costs and 'force the insurance companies to compete and keep them honest'" (Whitesides, 7/7).

Meanwhile, "moving to broaden the scope of the proposed healthcare overhaul, President Obama threw his support yesterday behind the creation of a program to help families struggling with long-term care costs," the Associate Press reports. "The voluntary insurance program, sponsored by Senator Edward M. Kennedy of Massachusetts, would pay a modest daily cash benefit of at least $50 that people could use for a range of in-home services or nursing home expenses." Health and Human Services Secretary Kathleen Sebelius sent Kennedy a letter, released Tuesday, which said "Obama believes the long-term care program is an 'innovative' idea that should be 'part of health reform.'" Kennedy's Senate Health, Education, Labor and Pensions (HELP) Committee "will include the long-term care provisions in its version of healthcare legislation. But other lawmakers could prove a tough audience. The Congressional Budget Office is warning that premiums will not be enough to cover benefit costs after the program has been in operation for a few years. And Republicans said that over the next 75 years, it could cost $2 trillion" (Alonso-Zaldivar, 7/6).

NPR explains that the long-term care proposal, also called the Community Assistance Services and Supports Act (CLASS Act), "would let workers choose to have government deduct money from their paychecks -- maybe $65 to $100 a month -- and put it in a savings account. When they get old or disabled and need care, they could then use that money." Just days before the letter from Sebelius, "the conventional wisdom in Washington was that long-term care was too expensive. That changed when a Congressional Budget Office analysis said the CLASS Act would actually save money: Because if people delayed going into a nursing home or got home care that kept them out of the hospital, there would be a net savings for government. The projected savings of $58 billion over 10 years, proponents said, could then help pay for expensive health care expansion." But Republicans including Sen. Mike Enzi, R-Wyo., and Sen. Judd Gregg, R-N.H., says that "adding long-term care would create a costly new program for years to come" (Shapiro, 7/7).

In other news, "With the Obama administration's help, hospitals are moving aggressively to resolve their biggest objections to legislative proposals to overhaul the health system," Kaiser Health News reports. "The deal set to be announced today -- an agreement with the White House and Senate Finance Committee on $155 billion in funding cuts over a decade -- is only the most public part of their intense lobbying effort. For weeks, hospitals have been battling proposals to create a government-run insurance option for consumers, out of fear it would pay hospitals less than private insurance." Between Emanuel's remarks to the Wall Street Journal and Obama's statement from Moscow supporting a public option, "the [hospital] industry is getting mixed signals" (Pianin and Galewitz, 7/8).

But the New York Times reports that the White House's deals with health industry groups, including drug companies and most recently hospitals, may not be as good as they sound. "In each case, the Obama administration hailed the agreements as historic. But what has been little discussed is what the industry groups will be getting in return for their cooperation, whether or not the promised savings ever materialize. The short-term political benefits are clear. Senior White House officials say the deals are building momentum that will help propel the health care legislation past potential opponents in the private sector and on Capitol Hill." The deals have kept industry groups at the bargaining table rather than "running advertisements against the White House." But "some lawmakers said the deals, while seemingly helpful, could raise false expectations by obscuring how much the industry is demanding for its concessions" (Herszenhorn and Stolberg, 7/7).