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After Votes, Prospects for Public Health Insurance Option Dim in Senate

President Barack Obama kept alive his hopes for a bipartisan health care bill as a U.S. Senate committee turned back an effort by liberals Tuesday to inject a government-run insurance plan into the legislation. (Sept. 29)

Support for a public option is much broader among House Democrats. "I think a very significant majority of Democrats in the House of Representatives are okay with a public option," said Majority Leader Steny H. Hoyer (Md.), who is closely allied with House moderates.

How to structure a public option is just one of five or six major sticking points in the House, where lawmakers are struggling to rewrite an expansion of insurance coverage to meet Obama's requirement that any bill be deficit-neutral and cost $900 billion or less over the next decade.

Options for reducing the price of the more than $1 trillion House package include trimming the generosity of insurance plans that would be subsidized through new state-run exchanges, designed to allow people without access to affordable employer coverage to buy policies at discounted group rates. Another proposal would shift a larger part of the burden for expanding Medicaid eligibility to the states, House aides said.

House leaders met Tuesday to discuss ways to correct regional disparities in Medicare reimbursement rates, and they are haggling over how to handle funding for abortions, to the extent that private plans offered on exchanges will be permitted to cover the service. Also unresolved is whether undocumented immigrants would have access to the exchanges.

Nor have House Democrats settled on a package of tax increases and spending cuts to pay for an insurance expansion. In July, the House Ways and Means Committee approved a surtax on income over $350,000 as a primary source of funding, but Pelosi has since suggested that she would rather see the surtax applied only to millionaires. She has also said she is considering a Senate plan to impose a 35 percent excise tax on generous "Cadillac" insurance policies, but other top House Democrats say that is not their preference.

Without it, however, the House would be left with a revenue package that would not keep up with the cost of expanding coverage, throwing the plan into deficit sometime after 2019.

Senators also voted Tuesday to restore federal funding for abstinence-only education, which Obama had proposed to eliminate. Conrad and Sen. Blanche Lincoln (Ark.) joined all 10 Republicans on the Finance Committee in adding the $50 million-a-year program to the health care bill.

The measure would still have to pass the full House and Senate.

Obama had proposed in his 2010 budget to direct money spent on abstinence-only education to broader teen pregnancy-reduction programs.

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