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Key Feature Of Obama Health Plan May Be Out

The president has said that creating a nonprofit, government-sponsored insurance plan -- competing alongside private insurers -- would provide a lower-cost alternative for consumers and keep the industry "honest." In Colorado on Saturday, the tone was more conciliatory.

"The public option, whether we have it or we don't have it, is not the entirety of health-care reform," Obama said. "This is just one sliver of it."

The proposal has become a lightning rod, particularly in the Senate, where Finance Committee members are seeking bipartisan consensus.

"The fact of the matter is there are not the votes in the United States Senate for the public option," said Conrad, one of six panel members involved in the talks. "There never have been. So to continue to chase that rabbit, I think, is just a wasted effort."

Sen. Orrin G. Hatch (R-Utah) said Democrats are moving toward a European-style, single-payer system. "And this public plan, this public government plan, don't think for a minute that that will not destroy the current insurance system," he said on ABC's "This Week."

Sebelius and other administration aides have said Obama is open to a nonprofit cooperative model as an alternative to the public option and the existing private plans. Finance Committee members have been studying utility co-ops as a possible model.

Liberal leaders reacted strongly to the idea that Obama would walk away from what they consider a central element of reform.

"I don't think this bill is worth passing without a public option," said Howard Dean, head of the grass-roots group Democracy for America.

Rep. Eddie Bernice Johnson (D-Tex.) said it would be difficult to pass a bill in the House without a robust government alternative.

"The private insurance companies have been in charge for so long that I think they feel that nobody else ought to be able to do it," she said on CNN's "State of the Union."

Said Sebelius earlier on the same program: "What's important is choice and competition. And I'm convinced at the end of the day, the plan will have both of those."

Staff writer Philip Rucker contributed to this report.

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