Everyone Loves An Opt-Out

Here we have yet another compromise on the public option that sets moderates in Washington stirring. The "opt-out" national public option, which would offer states a chance to eliminate it for their own jurisdiction, is gaining support on Capitol Hill. Chuck Schumer says it's being "very seriously considered". Max Baucus says through an aide he would consider supporting it. Howard Dean said he'd support it if he were a Senator. Richard Kirsch from HCAN says it's better than triggers, co-ops and opt-ins, which is faint praise but praise nonetheless.

I think there's some good and bad to it. We don't know what the opt-out would look like - a referendum? Gubernatorial veto? Federal waiver? A policy bill with a hurdle in state legislatures? Tied to funding? - and how easy it could be surmounted, as well as how easily gamed by special interests. Insurance companies are spending $1 million a day to beat the public option in Congress, you don't need that much to beat it in the states. Would this have a chilling effect on all federal legislation, with every big bill subsequently requiring a state opt-out, balkanizing the country? Or would every red state Governor bluff at opting out, and then, after seeing the numbers for how this would really help people, grudgingly accept it? We also don't know what kind of public option this would bring into being. Would it be Chuck Schumer's weak conception with no tie to Medicare bargaining rates? Or a robust public option with Medicare + 5% rates and Medicare's provider network? I think Nancy Pelosi is doing something very smart by scoring both versions just so the fiscal conservatives can choke on the numbers.

Speaker Nancy Pelosi (D-Calif.) will submit multiple versions of the House's healthcare bill for cost estimates, she announced on Thursday.

The first proposal will include a "robust public option," which would tie doctor reimbursement rates to that of Medicare plus five percent. The remaining two drafts submitted for the Congressional Budget Office's consideration would include a public option based on "the negotiated rates that some in our caucus have supported and which was passed by the Energy and Commerce Committee," the speaker explained during Thursday's press briefing.

"And then we'll see back from the CBO what the scoring is on all of that," Pelosi said. "And, of course, we have promised not a dime to the deficit. This is our promise. We will not take a bill to the floor, the president will not sign a bill that adds a dime to the deficit."

We already know that the CBO considers the robust version to save $85 billion more than the weak version, so this will just cement that even more.

All the while, House Progressives, which have formed a block requiring a straight national public option with no opt-out and ties to Medicare rates, continue to say they won't compromise, won't blink, and claims that they have the votes they need to pass their plan in the House, although some have questioned the numbers.

I think the strategy should be maximalist - pass the best of what you can in the House, and the best of what you can in the Senate, so that when the two bills are merged, you at least are dealing with the best possible from both chambers. A merger, for example, could see a Medicare-tied public option with the opt-out clause.

However, the nagging feeling is that nobody wants to stop the public option, or at least nobody wants to be responsible for it. In that case, shouldn't the plan for supporters be to say to them, "We dare you to kill this"?

The Waiting Is The Hardest Part

Determining whether a public insurance option will be in the final health care bill from Congress has been excruciating, and it's not about to get any better. I guarantee you it's going to look dead and buried or a rock-solid cinch about half a dozen more times before this is over. Here's what happened just today:

• Raul Grijalva said that his public option whip count is down to 46, from 60. And he wouldn't announce the names, which made it look like he was shielding the members who dropped off. Bad!

• Later, 51 Democrats in the House write to Steny Hoyer and Nancy Pelosi affirming their strong support for the public option. Good!

• Harry Reid backed off his remark that the final bill will have a public option. Bad!

• Later, we learn that the Grijalva whip count is probably bigger than 46 members; they just stopped the whip count once they had enough votes to block anything without a public option. Good!

• There's now a new whip count of all members of the Democratic caucus, on a public option tied to Medicare +5% rates. So far 170 members of the caucus support this. Good! But they need 218 for passage. Bad! But they're not done yet and Chris Bowers hears it's higher. Good!

• Andy Stern says there will be a price to pay for any Democrat who joins a Republican filibuster of a health care bill, regardless of whether a public option is in there or not. Good!

• Nobody wants to be the one to kill a public option. That's actually good! But they'll try to call whatever compromise that's inoffensive to the insurance companies a public option as a way out. That's bad!

I would recommend David Waldman's piece, because I think it's closest to the actual scenario on the minds of the Senate and the White House right now. Chasing this rumor or that can make you weary, however.

Showdown In The House

There's an important meeting today in the House of Representatives, where progressives and Blue Dogs will likely show their cards on health care reform.

The Blue Dog Coalition is engaged in a member-to-member whip operation in the House, beginning with a survey of its 52 lawmakers, to find out where they stand on critical health care issues. The principal focus is the public insurance option, but the canvass also touches on various tax and revenue increase proposals to pay for reform.

For the first time since they formed in 1995, the Blue Dogs have been out-organized by their liberal counterparts. The Congressional Progressive Caucus completed its first survey and began whipping back in the spring. They launched a final whip count last week that will be finished by Wednesday evening.

The whip count builds on an earlier letter that 60 members of the progressive caucus signed, pledging to oppose any health care bill without a "robust public option."

"We're going back to those people and saying, 'Hey, are you still with the letter?'" said Rep. Raul Grijalva (D-Ariz.), co-chair of the CPC. "And if there's been slippage, how much? And if we have a committed core, how many?"

Grijalva is asking members to back the public option all the way through the process, not simply on the first vote on the House floor.

The count comes in advance of a critical House Democratic caucus meeting Thursday morning in the Capitol, where leadership will take their own whip count. The fate of the public option in the House will be largely determined by the parallel whip efforts -- and how aggressive each bloc is in pushing for its priorities. In other words, it comes down to which pack wants it more, the Blue Dogs or the progressives.

So far, Grijalva has intimated that he still has the votes, although he hasn't delivered an exact count. Blue Dogs are trying to bait Pelosi by claiming she doesn't have the votes for the bill as currently constructed, but we'll probably know that by tonight. For Pelosi's part, she has a plan to start finalizing the bill after the meeting, with a possible floor debate on the public option. However, she shot down the trigger today as "an excuse for not doing anything."

The Blue Dogs are also whining about not being protected from tough votes, because the mission of public service is to come up with the most bland, inoffensive legislation possible and not to do anything that might make anyone mad. That's the picture of leadership. These ConservaDems either don't understand politics very well or are just being opaque about their true feelings.

Politically vulnerable Democrats say Speaker Nancy Pelosi and other House leaders aren’t offering them the protection from tough votes that they did in the last Congress.

Conservative Democrats fear that dozens of members could be swept out of their districts in the midterm election next year, and that fear has been intensifying in recent weeks.

Between a tough vote on a climate change bill that many don’t expect to become law and a leftward push on healthcare legislation, Pelosi’s (D-Calif.) critics within her caucus say she’s left the so-called “majority makers” exposed.

“She keeps trying to push an unpopular package,” said Rep. Gene Taylor (D-Miss.), a centrist Blue Dog Democrat, referring to healthcare. “I think it’s fair to say they were better at it before.”

Another Blue Dog lawmaker put it more bluntly.

“They’re seriously endangering their majority,” said the Blue Dog, who requested anonymity. “With the increased margin and a [Democratic] president, there seems to be a different feeling.”

What would endanger the majority are two things - no health care bill, or a health care package without a public option, which translates into a health care package that nobody in the country would like. What you would have left is an individual mandate to force people to shell out money to private insurers only, without the price controls to make that insurance affordable, a recipe for a continued skyrocketing of premiums. People interface the health care market primarily through those premiums as long as they remain healthy, and without competition in the insurance market it's going to be hard to dial them downward. There is currently no provision forcing insurers to lower premiums as a function of lowered overall health care delivery system costs. Only competition will provide that.

As I've said, the insistence on the public option is a self-preservation strategy. Rahm Emanuel might want to throw up his hands and pretend that only Congress decides on it, but he may want to get involved. As someone who claims to have brought the Democrats the House and Senate, he should know a thing or two about losing a majority. He could also recall 1994, when he worked in the Clinton White House and pushed NAFTA on the Congress, and watched as conservative Democrats from rural districts, who lost the trust of the people through selling out their jobs, were the first in line to fall from the Gingrichites. Failure to energize the base and provide something tangible for people could produce a similar result.

Making Blue Dogs Blue

The Hill reports that the Speaker will respond to pressure from progressives and move the health care bill back to the left when she merges the competing measures from committee:

Speaker Pelosi is nixing a deal she cut with centrists to advance health reform, said a source familiar with negotiations.

Pelosi’s decision to abandon the agreement that was made with a group of Blue Dogs to get the bill out of committee would steer the healthcare legislation back to the left as she prepares for a floor vote.

Pelosi is planning to include a government-run public option in the House version of the healthcare bill. She wants to model it on Medicare, with providers getting reimbursed on a scale pegged to Medicare rates.

"The speaker is full-steam-ahead," said a senior Democratic aide.

Let's be clear who broke the agreement. The Blue Dogs and Waxman negotiated a deal to water down the public option but still include it in a final bill. Mike Ross came back from recess and said he could not support a public option whatsoever. At that point, the deal ended. And Ross, secure with his payoff from a pharmacy chain from a couple years back, has nobody to blame but himself.

This puts the House bill in the best negotiating position for the inevitable conference committee. Obviously the public option is a compromise in itself, but further grinding it into nothing would have made it nearly impossible to defend its inclusion in conference. Pelosi is determined to have the House be an equal player in this debate, and that starts by her passing the best bill possible from her chamber.

In other good news, the single-payer bill, HR 676, will finally get a score from the Congressional Budget Office. This score could be an excellent tool for advocates down the road, and it's sad that it's taken this long for such a score to be calculated.

House Progressives To Keep Fighting

Despite enormous pressure against them and few institutional allies, the House Progressive Caucus will keep fighting for a public option.

Next week will be gut-check time for the bloc of progressives standing in opposition to any bill that doesn't include a public health insurance option.

The leadership of the Congressional Progressive Caucus plans a "whip count" for early in the week to gauge the strength of their coalition, caucus members tell the Huffington Post. The whip team will also approach members of the Congressional Black, Hispanic, and Asian Pacific American Caucuses.

Democrats hold 256 seats in Congress and need 218 to pass a bill, meaning 39 progressives, voting together, could tank the legislation, assuming all Republicans vote nay.

The whip count will send a message to to the administration, said CPC co-chair Raul Grijalva (D-Ariz.): "Don't cut deals with some elements of our party or with some elements of the Republican Party without including the progressives in that discussion," he suggested. "So we're going to count our votes, see how many we have and that's the number we're going to indicate to both the leadership and the administration."

Rep. Keith Ellison (D-Minn.), a member of CPC leadership, estimates that eighty to 100 members will make the pledge. The progressive caucus met on Thursday, following the president's speech, and members repeated their commitment to seeing the public option included in the bill, said Ellison.

Grijalva guessed the whip count would be lower than Ellison's estimate. "We need firm votes," he said.

I agree with Grijalva, the final number will be lower. However, there will be a number of conservative Democrats in states like Alabama and Idaho and Mississippi who won't vote for any kind of health care bill, because they're basically Republicans. So I would say that if progressives can find somewhere between 25-30 members to stand firm, they'll be able to block anything. They got 32 votes against the Afghan war, so it's not impossible.

While Senate moderates and, in all likelihood, the Administration are pushing hard for a trigger, Obama's own rhetoric in defending the public option works against him here. He acknowledged in his Wednesday speech that his conception of a public option would bring some choice but would be small, only bring in 10 million people tops, wouldn't use Medicare bargaining rates, and is only a small piece of overall reform. In that case, moderates should be able to live with it, since there's so much else in the bill they seek. But of course, that's never how the game is played in Washington.

However this turns out, that vaunted unity in the Democratic caucus doesn't seem to be there completely. And that's actually a good thing. There should be a range of opinions in the caucus, and those debates can work themselves out. If one side is constantly made to knuckle under, it doesn't actually allow for any ideological variance, and doesn't give much of a reason for that side, which reflects the Democratic base, to stay in the Party.

Where You Stand Depends Upon Where You Sit

Word leaked last week of an official meeting, before Obama's speech, between him and the chairs of that Congressional Progressive Caucus, Congressional Black Caucus, Congressional Hispanic Caucus, and Congressional Asian Pacific American Caucus. But that never happened. The White House never called.

Meanwhile, today, seventeen Senate Democratic moderates, basically everyone in Evan Bayh's moderate coalition along with Arlen Specter, have been summoned to the White House. That was an appointment kept.

I suppose this could be to crack the whip, but given the juxtaposition of these events as well as political reality of who is perceived to be needed to pass a bill, that's not likely. The strategy to respect the ability of progressives to hold up legislation has of yet not borne fruit.

This is a good a time as any to print Raul Grijalva's reaction to the speech:

“I am pleased that President Obama made the right choice to recognize the importance of a public option as part of the health care reform legislation.

“A public option is the most effective way to achieve our goals of controlling costs, eliminating abuses of patients by insurance company abuses, and providing quality health care to all.

“However, the President needs to be more direct on what the public option means and what it will do for the American people.

“President Obama was elected to bring change and progress. I fear that if my party and the President do not appreciate the mandate the American people have given us, the people will lose confidence in the idea that they can vote for change and get what they voted for.

“We in the majority must have the courage to do what is in our power to do, and pass a bill that guarantees access to affordable, quality health care.

“Doing nothing is not an option. That is why I oppose efforts to delay and kill real reform with a so-called “trigger”. We cannot wait and just hope that the insurance companies will develop a conscience.

“The defenders of the way things are want to diminish and destroy the public option because they fear it will be effective. A national insurance plan would have the bargaining power to get lower drug prices and better deals with health providers.

“We cannot rely solely on the insurance companies' good faith efforts to provide for our constituents. A robust public option is essential, if we are to ensure that all Americans can receive healthcare that is accessible, guaranteed and of high-quality. Health insurance reform is an investment in our future that we cannot afford not to make.”

The President said quite the opposite yesterday, actually, defending the concept of a public option but reassuring skeptics that it wouldn't have the market share or the rate-setting ability to do anything meaningful to costs. But that's not a ringing endorsement of the policy. It's a downplaying of what the plan on offer would do. In that sense, it's correct - the public option available now would firewall people who get coverage through an employer and wouldn't be able to set rates to bargain for lower premium costs. But of course, enshrining it in legislation would give it the opportunity to expand, which is the whole point behind the progressive push. So Obama really soft-sold the public option last night, and invited weak alternatives like co-ops or triggers. So Grijalva was right to attack the President on this point.

The public option is not a fetish. It's a policy prescription which, if done right, could save massive amounts of money for people, businesses and the government, as well as provide decent health care for everyone. It's only considered a fetish by Villagers insulated from the consequences of having no insurance. Those fighting for its enshrinement are simply doing right by their communities, secure in the belief that a competitive option to insurance CEOs is the best chance for quality and affordable health care as a fundamental right and not a privilege to succeed.

They're demanding another meeting. Good for them.

...The only hope is that the President is telling ConservaDems that they'd better not join a Republican filibuster, but I simply find that unlikely.

Intrigue In The Palace On Health Care

The President will apparently support and endorse the public option in his speech tonight but fall short of demanding it. More on that in a later post. Really, if the members of Congress supporting a public option don't show their mettle in this debate, it won't totally matter what the President supports.

Over the past 48 hours, the blogosphere has blown all kinds of holes in Max Baucus' bill, but on Capitol Hill people are being a bit more circumspect, probably because they just want him to pass the sucker out of his committee so we can get on with the work of health care reform. And yet even media types are slagging Baucus for delaying the same bill he could have had in June for three months for no particular reason. So clearly, his centrality to the debate has lost traction.

The center of gravity has really shifted toward Olympia Snowe. And therefore, it's good to see Robert Reich knock her trigger proposal back to kingdom come. Reich rightly notes that this idea we can devise a formula to know definitively if insureres are living up to their responsibilities is ludicrous. Therefore, corporate interests and Republicans (redundant) will just argue the numbers on the trigger and delay the public option forever. And adding a five-year delay just snuffs out all of the political energy for change.

Even better than this is Chuck Schumer arguing enthusiastically for using reconciliation for at least part of the bill - and a public option would fit that mold.

Q: I’m curious, the leadership was trying to use reconciliation as way to force Republicans to the bargaining table. Do you think that failed and do you think reconciliation is still part of the plan?

A: I think we still have to look seriously at reconciliation because even with 60 Democrats, you know, if we’re able to get somebody here from Massachusetts, it’s not easy to do.

Q: Are you planning on having an interim appointment from Massachusetts?

A: No, I don’t know. That would be up to the Massachusetts state legislature but I know they’re considering it. Ah, so, so the bottom line is that even with 60 or even if Olympia Snowe comes to some kind of agreement, it’s going to be hard, and I’ve always favored using reconciliation for good parts of the bill. I think that will get you the best bill, the strongest bill and the bill that will have the greatest positive effect on the American people. Ultimately, we’ll be judged not by whether we pass the bill, but ultimately we’ll be judged by weather it works. Leaving the bill as something that doesn’t work, even if we pass it, leads to hurting both the country and the party.

Now if THAT could only become the center of gravity opinion in the health care debate...

In addition to the slagging of Baucus-care and Snowe-care and the talking up of reconciliation, you have the insistence from House progressives to only vote for a bill with the public option. And as Anthony Weiner notes, there's a strategic component to this as well:

Dem Rep. Anthony Weiner, who’s taken on a counterintuitive and increasingly high profile role defending the public plan, just said for the first time in an interview with me that he doesn’t see “any way” he can vote for a bill without the public option in it.

“I dont see how I could,” said Weiner, when I asked whether he’d vote for a bill without a robust public plan. “I dont see any way I could.” His throwing down of the gauntlet is more striking when you consider that he’s known at home in New York as a moderate who’s not known for bucking leadership [...]

“All of the protest letters in the world don’t add up to much if you don’t finally stand up and vote No on something the President and Nancy want,” Weiner said. “There is clearly a sense that progressives in Congress are easily rolled.”

“If the Congressional left can’t pass even something as modest as a watered down public option, then frankly I don’t think anyone is going to take the left very seriously later on in this Congress,” Weiner continued. “When Blue Dogs talk, there are fewer of them but they have more influence than when progressives talk.”

Yes, this is a proxy for future fights and a means to change the dynamic in the Congress, getting respect for progressives pushing the agenda that got most Democrats in Congress elected. The combination of all of these things is adding up to a decent enough strategy, but the President is also no bystander here. More on that in a moment.

Trigger Happy Jack

Over the weekend, Ben Nelson, the most conservative Democrat in the Senate and as such a decent bellweather for where the health care policy might go, appeared to support a trigger for the public option, as long as it wasn't a "hair trigger." DougJ surmised that his conception of a hair trigger would be one that might actually go off, and he would prefer a trigger that just remains hypothetical forever. And he's right. There's a trigger in the 2003 Medicare Part D bill that would allow the government to sell prescription drugs through a public option if the drug companies couldn't do it properly themselves. And that trigger never got pulled. So Ben Nelson wants that same dynamic play out in the overall health care bill.

Ezra Klein argues that the public option on offer would not equal cost control because it doesn't use Medicare bargaining rates and its own pool of customers is too small to bargain for anything meaningful. Which is true - ask Ian Welsh - and why I support both using Medicare bargaining rates and opening up the exchanges to those who get coverage from an employer. It's also true that getting a public option into place will increase the possibility that it can be opened up or paired with Medicare rates in the future, whereas no public option on this go-round will make it nearly impossible to get one later - basically the same exact heavy lift as we're seeing now. There's also a distinction to be made between cost control to the federal government and cost control to the individual premium purchaser. A non-profit public option that still uses the Department of Health and Human Services to bargain for rates will have a lower cost to the individual in that market. The CBO estimate of 10 million subscribers is just an estimate - but it should be said that even with those numbers, the CBO saw the public option as a net savings of $150 billion over ten years, contra Tom Brokaw. If the public plan can offer the same basic coverage at a lower cost, people will buy it. And insurers will lower their premium costs to capture more of the market share. They call it "price wars" in other industries, and it's been virtually non-existent in the insurance market forever. The Swiss version of regulated insurance mandates works because basic coverage is provided entirely by non-profits.

As Matt Yglesias says, Switzerland is a country which "came late to the universal health care game thus did it in a way that involves a lot of compromises with existing interest groups." The single-payer countries all enacted their proposals in the early postwar period at the latest, when the health industry wasn't as large and powerful and medicine wasn't as advanced. It has clearly gotten progressively harder to outflank the more entrenched special interests. That's what we're seeing today with the move toward a trigger that will never trigger itself. That may be evident in the House bill even though it has a public option, considering the meager nature of that option and the too-low coverage subsidies.

But this is a game of inches. And we need to enact as much as possible in this moment of opportunity, and move to the cost controls and refining of the elements later. We need to inscribe universal coverage in the American system with a major check on for-profit insurers. That's why the wavering from House liberals desperate to bargain is extremely troubling.

Amid fresh signs that the White House is preparing to back a scaled-down health care overhaul that would only include a public insurance option as a fallback plan, several House liberals told Roll Call that they could support such a bill depending on how it was structured.

The “trigger” approach has been considered a deal-killer by liberals on and off Capitol Hill, and the willingness of some Congressional Progressive Caucus members to entertain it reflects a recognition that a bruising August recess has imperiled prospects for reform and redrawn expectations for what is possible.

“This is a way to get a bill,” Rep. Bill Pascrell (D-N.J.) said. “I believe it’s worth listening to because I want legislation that is going to, in some shape or form, expand coverage and bring down the cost of health care.”

Liberals stressed that the shift does not amount to an abandonment of their commitment to a “robust” public insurance option. They said they would only support a trigger if that approach guaranteed the same access, quality and affordability.

“I don’t want to give the impression that I’m so flexible that I’m willing to compromise away meaningful reform,” Rep. Jim McGovern (D-Mass.) said. “But there may be a variety of ways of getting there than the one I originally formulated in my mind.” [...]

“We’re the caucus that least marches to a unified drummer — that’s not what we do,” Rep. Mike Capuano (D-Mass.) said. “I’m serious about increasing access and quality, but that doesn’t mean it has to be a grand slam home run. I’ll take a ground-rule double if that’s what it takes. I’m happy to compromise if that’s what it takes. But compromise is compromise — it’s not rolling over.” [...]

Rep. Sam Farr (D-Calif.), a Progressive Caucus member, said he did not support the approach but did not foreclose on it, either. “It depends on how strong that trigger is,” he said. Farr said he has seen triggers implemented effectively in California. “Triggers work, but they’ve got to be really clear as to how they operate,” he said. “The only way I could see it getting progressive votes is by making sure the public option is strong and goes into operation.”

(Farr's actually right, but he won't be writing the bill and the language on the trigger, and surely he knows it will be written to never come into existence.)

There's just no reason to even participate in an article like this. It only serves to weaken the position of the caucus. Mike Capuano in particular clearly has no negotiating skills whatsoever - telling the world that the Progressive Caucus has no unity?

I recognize that these members want a reform bill badly. But use your poker face, fercryinoutloud. The other side of the caucus certainly is.

...They could play it like John Conyers:

“It is clear that real reform means injecting real competition into the insurance market to improve affordability and drive down health care costs. The centerpiece of this reform is a robust Medicare-like public health insurance plan tied to the Medicare provider system. Like many of my colleagues in both the House and Senate, I will oppose any health care reform bill that lacks such a plan. I will also oppose any legislation that seeks to replace a robust public health insurance option with health care cooperatives or which ties the availability of the public option to a trigger mechanism. In this effort, I stand in solidarity with House progressives, the majority of my friends in organized labor, millions of health care providers, and 72 percent of the American people.

No Need To Kid Ourselves

I don't think it takes a genius to see where things are leading:

CNN has learned that the White House is quietly working to draft health care legislation after allowing Congress to work on its own for months.

Multiple sources close to the process tell CNN that while the plan is uncertain, they are preparing for the possibility they could deliver their own legislation to Capitol Hill sometime after the President Barack Obama's speech to a joint session of Congress Wednesday, with one source calling the possibility of new legislation a "contingency" approach if efforts by Finance Committee Chairman Max Baucus to craft a deal fall through.

Multiple sources say the current thinking among administration officials is that the president will lay out a path to reform in his speech next week that the White House hopes can bridge the various differences in the competing proposals. Sources expect the president to emphasize the message: If Congress passes something now, it will serve as a foundation to pass further reform in the future. (emphasis mine)

The Baucus caucus met today, and Baucus said he'll simply put out his own bill, and basically they'll either have a bipartisan solution by September 15 or break up the Gang of Six and go to a markup.

It's pretty obvious what's going on. The President will settle for the trigger and try to get President Olympia Snowe to write the bill. The trigger has basically already been triggered, that's why the crisis has moved to a point where we need reform. And we know from experience that the trigger will be set up so it never gets triggered to bring a public option into being.

A trigger for the public health insurance option would create underpowered public plans that would be swallowed whole by the insurance industry. A trigger would also tell the insurance industry the exact minimum level of care and service they need to provide (a level worse than they provide now) before they face competition, giving them incentive to stay at that level and no better. That trigger will never be triggered - instead, it will kill the public health insurance option. But most importantly, a trigger wants us to wait for our crisis to worsen before we fix it.

That's not a compromise. That's not even a rational proposal. Waiting for the crisis to get worse does nothing but help the insurance industry at the expense of our wallets, our health, and our lives.

The trigger kills the public health insurance option. It is not health reform. It should be rejected.

Liberals are angry but have been marginalized in the last few days. ConservaDems, emboldened by hopes of protecting their corporate contributors, are taking a victory lap. Fight on, radical moderates, fight on.

And in between, the mainstream Dems want to take half a loaf.

Clyburn said Democrats should be satisfied if they can only achieve "half a loaf" of reforms, noting that President Lyndon Johnson didn't get all of his landmark civil rights legislation through Congress on his first try.

"We can pass a health-care bill that will do a lot of good," Clyburn said. "It may not be perfect, but we ought not to sacrifice the good on the altar of the perfect."

The writing's on the wall here. And we'll see if the Progressive Block in the House means anything.

...In his conference call with Progressive Caucus members, Obama straight up asked House liberals "how far they're willing to compromise on the public option". Greg Sargent has more. He apparently told them that they had the luxury of being in safe seats, although while they may be safe D, they won't be safe from primary challenges if they have to give on what has become this fundamental pillar of health care reform.

The Progressive Revolt And Its Implications

House liberals will not go quietly, Mr. Emanuel.

In a letter delivered to the White House moments ago, the two leaders of the bloc of House progressives bluntly told President Obama that they will not support any health care plan without a public option in it — and demanded a meeting to inform him face to face.

The not-yet-released letter — the first joint statement from progressives since news emerged that Obama might not address the public option in next week’s speech — is their sharpest challenge yet to the president, given the extraordinary sensitivity of this political moment. The letter urges him to mention the public option in his speech.

“Any bill that does not provide, at a minimum, a public option built on the Medicare provider system and with reimbursement based on Mediare rates — not negotiated rates — is unacceptable,” reads the letter, which was sent over by a source. It was signed by Reps. Lynn Woolsey and Raul Grijalva, the two leaders of the Congressional Progressive Caucus.

They're buttressed by the Speaker of the House, quoted again as saying that a bill without a public option cannot pass the House and that its elimination would be a major victory for insurance companies. Not much room to climb down from those remarks.

Some chin-scratchers are wondering why the public option, a so-called "sliver" of the legislation but not its entirety, has taken on such prominent significance. I think this gets at part of it.

To help understand, I think it’s useful to read past the sarcastic opening to this Chris Bowers post and read him lay out the strategic thinking in detail. I think what you’ll see is that while the movement on behalf of the public option certainly wants a public option and believes the public option is important, the larger goal is to “to try and make the federal government more responsive to progressives in the long-term” by engaging in a form of inside-outside organizing and legislative brinksmanship that’s aimed at enhancing the level of clout small-p progressives in general and the big-p Progressive Caucus in particular enjoy on Capitol Hill.

That requires, arguably, some tactical extremism. If you become known as the guys who are always willing to be reasonable and fold while the Blue Dogs are the guys who are happy to let the world burn unless someone kisses your ring, then in the short-term your reasonableness will let some things get done but over the long-term you’ll get squeezed out. And it also requires you to pick winnable fights, which may mean blowing the specific stakes in the fight a bit out of proportion in the service of the larger goal.

There's more to it than that, however. First of all, whatever the state of the public option on offer - and I don't think it's sufficient - can be improved upon if it just gets past the post and into circulation. I cannot believe that Ezra Klein would think that something like a public option could be introduced as an add-on later, as long as the "basic structure" of universality gets enacted now. A government-administered insurance plan is not a minor fix; getting one for Medicare or Medicaid took a number of years and tough battles, and we still leave out everyone under 65 who isn't impoverished. Adding it later would not be a "relatively simple matter," as he says. We get a crack at this now, or we create a forced market through an individual mandate that makes it a crime not to buy private health insurance. Given our crack regulatory structure in the US of A, that won't hold, the insurance companies won't live up to their end of the bargain, and costs will continue to soar. If the subsidies are too low, this wouldn't even get out of the gate - both parties would be clamoring to repeal it. Adding the public option offers far more opportunities to improve upon the system, rather than not having that option and having to do a supreme lift to get it. I agree that the coverage subsidies and the design of the exchanges are important, but the public option stands with those as a pillar of the plan.

And I know that because none other than Max Baucus told me so in his original white paper on the subject.

Tell me how this sounds for a health care reform plan.

• A national health care exchange
• Buy-in to Medicare at age 55
• No discrimination against those with pre-existing conditions
• No waiting period for Medicare for disabled
• CHIP covers up to 250% of poverty level
• Credits for small businesses and individuals to make health care affordable

Oh, and don't forget this bit:

• A public option

Now, it may surprise you to learn this. But the architect of this program is none other than Max Baucus--the guy who has been pushing against a public option since the insurers were allowed to drive this debate. Here's the language from his white paper--dated November 12, 2008--on the public option:

The Exchange would also include a new public plan option, similar to Medicare. This option would abide by the same rules as private insurance plans participating in the Exchange (e.g., offer the same levels of benefits and set the premiums the same way). Rates paid to health care providers by this option would be determined by balancing the goals of increasing competition and ensuring access for patients to high-quality health care.

There was a time when conservative Democrats knew how to best deliver a quality health care bill, and us dumb-as-a-stick bloggers and activists went ahead and looked at the proposals and actually agreed with them. Silly us!

The other reason why progressives are drawing a line in the sand over a public option is that they voted for one, and voted for a President and a Congress to deliver it. Clearly conservatives were going to freak out on the President as a mad socialist no matter how much he trimmed his sails, so it would be appropriate to at least deliver on a promise or two. Give them something to talk about and all that.

And contrary to popular opinion, Blue Dogs actually need health care reform far more than progressives. Sure, they want to do it in such a way that preserves corporate profits. But progressives can see the desire to pass something and exploit that for their own ends, which is approximately how politics works, basically.

The reason I disagree with Klein is fairly simple: if no health care legislation passes, and Democrats lose seats as a result, Blue Dogs are the people who will lose the seats, not Progressives. Even if Klein is correct and Democrats lose a bunch of seats because Progressives blocked it, Blue Dogs are actually the ones who will bear the brunt of those losses. As such, Blue Dogs have more to lose if health care fails to pass than Progressives [...]

If we feel that we have to protect Blue Dogs at all costs, then of course it will be impossible for Progressives to have as much leverage as Blue Dogs. However, as soon as we make it clear that we don't feel much of a need to protect Blue Dogs, then they are the ones who have a lot more reason to cave into our demands. If another Republican wave really is coming, Blue Dogs will be the first Democrats to lose.

I see nothing wrong with a maximalist strategy, which also corresponds to the stated goal of cutting costs and helping people get health care coverage. It does have an importance for future fights. But it also has an importance for right now. A health care reform that forces people to buy private insurance will destroy the party that builds it. And because of the emphasis placed on the public option, which is really out of the control of Washington at this point, a failure to incorporate it into the final legislation will dispirit the base and lead to a slaughter in 2010. In addition to being smart politics, the progressive revolt is a self-preservation strategy for the Democratic Party.

Reconciling Themselves

I mentioned earlier the rumblings from Democrats about passing a public option plan through the reconciliation process rather than through something subject to filibuster. Clearly the public option either saves or spends budget money - I don't think one member of Congress would disagree with that - and typically those types of things are available to reconciliation. COBRA, the program allowing people to retain their employer-based insurance if they are laid off, was achieved through reconciliation - in fact, COBRA stands for the "Consolidated Omnibus Budget Reconciliation Act". So the history is there to do this, and of course, Republicans have used this history over and over.

In a memo that was drafted and circulated on background in April, Senate Democrats made the case that using a budget reconciliation bill to pass health care reforms is perfectly within their rights, given the Republicans' promiscuous use of the same tactic when they were in power. Excerpts of the memo were published by various news outlets back in the spring, but the memo doesn't appear to have been previously published in its entirety until now. And now, with Democrats ramping up the threat that they'll invoke the process in the fall, they're rehashing those same arguments.

"[S]hould Republicans choose not to cooperate [on health care reform], the inclusion of reconciliation instructions [in the budget] provides a backup option which could be used to prevent a filibuster and approve legislation by a majority vote," the memo reads. "[T]here is nothing unprecedented or unusual about the use of reconciliation."
The memo goes on note that Congress has invoked the reconciliation 19 times since 1980, including in 2001 and 2003 when ", the Republican Congress used reconciliation to pass enormous tax cuts"

"Republicans not only used reconciliation rules to push tax breaks for the wealthy, they also made no meaningful effort to assist the growing number of uninsured Americans," it reads.

This will be a very important document to use once the Republicans ramp up their whine about how very "unconstitutional" it is to mandate a majority vote on the public option.

The question is whether we can reach 50 votes in the Senate. Chris Bowers has either full commitments or fairly strong leaning in that direction from 49 members.

I will say this - it's going to be a lot easier to get from 49 to 50 in the Senate than it will be to peel back 30 or 40 of the House members who signed a letter saying they would support no bill without a public option. I actually attended this town hall meeting in Maxine Waters' district, and the bottom line is this: she will not be able to win re-election if she, after this performance, votes for a bill without a public option. Maybe on a smaller issue, she could get away with it, but not on an issue where 500 people in her district come to a standing-room-only town hall meeting and she says she will draw a "line in the sand." And I expect that other House members, in very blue districts, have made the same claims.

"President Obama has been trying to reach across the aisle" to win a compromise with Republicans, Waters said. "It is not going to happen."

Then Waters made a public appeal to Obama.

"The people of this country elected you and gave you a Democratic majority in the House and the Senate. . . . Yes, we know that you are a nice man, that you want to work with the opposite side of the aisle. But there comes a time when you need to drop that and move forward," Waters said. "We're saying to you, Mr. President, 'Be tough. Use everything that you've got. Do what you have to do. And we have your back.' "

Maybe I'm wrong, and progressives in the House will find some wiggle room by voting for a public option in the initial bill and accepting whatever comes out of conference. But I simply do not see them being able to get away with that. People are engaged and ready to go to war over this element of the reform, and won't accept a too-clever-by-half series of votes from their representatives.

The Actual Business Of Health Care

The teabag rallies are theater, but some actual substance has made its way into the health care debate this week.

First of all, the President has openly considered a partisan process to pass health care reform.

President Obama urged Democratic senators on Tuesday to persevere in trying to get a bipartisan deal on health care, but left open the possibility that they might have to pass a bill with only Democratic votes if Republicans stood in the way.

At lunch with Democrats at the White House, Mr. Obama vowed to respond to Republican attacks on his plan, which aims to guarantee insurance for all Americans while slowing the explosive growth of health costs.

The Senate majority leader, Harry Reid of Nevada, said there was “absolute unity” among members of the normally fractious Democratic conference.

“Everyone recognizes that we are going to do, if there’s any way humanly possible, a bipartisan bill,” Mr. Reid said. “We don’t want to do a partisan bill, and we hope our Republican colleagues acknowledge that. We’ll continue to work with them as long as we have to.”

I take the nods toward bipartisanship is simply what you say. The news here is Obama suggesting they must not be an obstacle. And frankly, it's about time. Chuck Grassley today actually referenced Ted Kennedy's brain tumor to try and whip up a fear of rationing. And he's one of the Republicans in the midst of bipartisan talks! They are simply not bargaining in good faith.

In an interview today with Chuck Todd, Obama reinforced the deadline for those talks in the Senate Finance Committee.

"I am glad that in the Senate Finance Committee, there have been a couple of Republicans--Chuck Grassley, Mike Enzi, Olympia Snowe--who have been willing to negotiate with Democrats to try to produce a bill. But they haven't yet. And I think at some point, sometime in September, we're just going to have to make an assessment."

He says he'd "prefer" a bipartisan process. And I'd prefer dinner every night at Nobu. But I can't get that. So I eat what I can get. Obama's saying the same thing. I think everyone's ready to go to war on this. And you will see arm-twisting to end cloture like you wouldn't imagine.

Meanwhile, Jay Rockefeller is doing a good job savaging the Finance Committee talks, talks which he has been shut out of even though he chairs the Health Subcommittee on the panel. Rockefeller's tough talk will push the debate in that committee to the left, just as liberals in the House are pushing Nancy Pelosi and the leadership to the left and drawing a line on the public option. And the September deadline enforces the whole process, telling Republicans like Grassley they can either have input or watch a bill get passed without them.

That's the theory, anyway, we'll see how it works in practice.

Couple other things. Health Care for America Now has a good report personalizing the health care debate and explaining what reform will bring for every type of family. And the White House has apparently secured a win in the all-important budget nerd battle:

The White House scored a point today in its ongoing battle to convince establishment Washington that health-care reform will succeed at cutting costs even as it expands coverage. The White House and budget director Peter Orszag, as well as the House Blue Dogs, are very bullish about allowing an independent board to pursue cost-cutting measures in Medicare. But when CBO scored the measure to determine if it would be succesful, they produced a very lukewarm estimate. Today, though, a group of health-care experts sent a letter [PDF] to Obama arguing that IMAC, the independent cost-cutting board, would be very effective if done right -- and nine of the signatories are members of the CBO's Panel of Health Advisers, nearly half the membership. It's a good sign for the White House, and will help push the message that, while CBO's scores are important, the assumptions made in that office are not carved in concrete.

The CBO simply should not be the final arbiter on questions that are really outside their purview.

Under The Wire

The House Energy and Commerce Committee passed out their health care bill by a bare margin, 31-28, as the Blue Dog deal held and the set of amended amendments that progressives demanded return to the bill got put in place as well.

In an unusual move before the final vote, Waxman halted the markup to have a closed-door meeting with Democrats on his panel – presumably to make sure he had the votes to pass the bill.

The final vote was 31-28, with five Democrats opposing the measure. Democrats who voted no were Reps. Rick Boucher (Va.), Bart Stupak (Mich.), Jim Matheson (Utah), John Barrow (Ga.) and Charles Melancon (La.). All Republicans rejected the bill [...]

Speaker Nancy Pelosi (D-Calif.) indicated on Friday that some of the most hard-fought provisions of the healthcare bill -- including parts meant to appease conservative Democrats -- could change by the time the final measure reaches the House floor.

"I have three chairmen to deal with," Pelosi said. "We have three committees that have to look at it."

As it turns out, the committee has about 60 or so amendments left to deal with, but they couldn't eat one day into their summer break, so they'll clean that up when they get back, apparently. How the Speaker can merge the bills together while 60 amendments sit in one committee before a vote is tricky, but fortunately nobody understands the details of this stuff anyway. The best practice would actually be for one large committee, perhaps an ad hoc committee, to deal with legislation of this type, even if it's big.

Anyway, it looks like progress, and I have no doubts that the House will vote on a decent enough bill when they get back from the recess. The success of it will be determined by the resolve of the Democratic caucus and the success of efforts to convince lawmakers when they are home in their districts.

...Amendments and roll call votes available here.

A Compromise In The Other Direction

While the deal reached between Henry Waxman and a core group of Blue Dog Democrats on the health care bill in the House Energy and Commerce Committee was reported as offering modest concessions, in truth the subsidies would have really dried up for families making between 300-400% of federal poverty level. Progressives revolted, mainly because the subsidy climb-downs attack the larger idea of offering affordable health insurance for everyone, the central goal of the program. So they revolted, and Waxman had to re-bargain with everyone to get a decent compromise of the compromise.

Liberals and a small core of conservative Democrats set aside long-standing ideological differences early Friday to cut a deal that should allow the House Energy and Commerce Committee to approve a sweeping health care bill, breaking a two-week deadlock that threatened President Barack Obama’s top domestic priority.

Blue Dog Democrats on the committee, who are the linchpin in the House health care debate, agreed to allow their liberal colleagues to cut billions from existing government-funded health care programs in order to restore some $50 billion to $65 billion in subsidies set aside in the bill to help middle-income families purchase coverage.

This final agreement should clear the way for committee passage later today. Energy and Commerce is the last of the three House committees to consider the bill, so passage will put the package in the hands of party leaders for a titanic fight when Congress returns in the fall over the government's role in health care [...]

The Blue Dogs preserved one of their main objectives: de-coupling the so-called public plans from Medicare, a change that gives health care providers the right to negotiate payments with the government.

Those rates were only scheduled for the first three years anyhow. My guess is that will be returned when the House bills get merged from all three committees in September, especially if progressives keep up the pressure. What's important now is to get the Energy and Commerce bill out of committee.

Let's understand how this happened. Blue Dogs held out for a deal. Progressives, instead of taking it to get the larger goal, revolted and got 57 names on a letter vowing not to support any Blue Dog compromise. The Blue Dogs, who came into this wanting to kill the public plan option, ending up voting it out of committee in Energy and Commerce and allowing for expanded subsidies. And progressives are STILL not satisfied, as it should be, because Medicare rates and providers should be tied to the public plan over its entire lifespan, and the plan (and the insurance exchange) should be available to everyone regardless of employer.

Moreover, the liberals also expressed a political concern, saying House leaders had compromised too early. “Under the agreement, private insurers are coming off unscathed,” said Representative Peter Welch, Democrat of Vermont.

He added, “They do quite well — too well, frankly.”

Representative Eliot L. Engel, Democrat of New York, said, “The public plan was eviscerated” under the deal announced Wednesday to get the bill moving again in the Energy and Commerce Committee.

Mr. Engel was less than enthusiastic about the resulting legislation. “It’s not a terrible bill,” he said, “but it’s not what I had hoped for.”

There was an abortion policy amendment in the committee that tries to split the difference by affirming that insurers "would not be required or forbidden to cover abortion." I'd prefer that the public plan be accorded the same benefits toward the most widely used outpatient procedure in America that 90% of all private plans cover, and we'll see where that debate goes.

Also hurting the Blue Dogs' cause is this WaPo front-pager, almost unquestionably meant to coincide with progressive discontent over the compromise, showing the amount of health industry money these so-called fiscal conservatives are swimming in.

The roiling debate about health-care reform has been a boon to the political fortunes of Ross and 51 other members of the Blue Dog Coalition, who have become key brokers in shaping legislation in the House. Objections from the group resulted in a compromise bill announced this week that includes higher payments for rural providers and softens a public insurance option that industry groups object to. The deal also would allow states to set up nonprofit cooperatives to offer coverage, a Republican-generated idea that insurers favor as an alternative to a public insurance option.

At the same time, the group has set a record pace for fundraising this year through its political action committee, surpassing other congressional leadership PACs in collecting more than $1.1 million through June. More than half the money came from the health-care, insurance and financial services industries, marking a notable surge in donations from those sectors compared with earlier years, according to an analysis by the Center for Public Integrity.

A look at career contribution patterns also shows that typical Blue Dogs receive significantly more money -- about 25 percent -- from the health-care and insurance sectors than other Democrats, putting them closer to Republicans in attracting industry support.

Most of the major corporations and trade groups in those sectors are regular contributors to the Blue Dog PAC. They include drugmakers such as Pfizer and Novartis; insurers such as WellPoint and Northwestern Mutual Life; and industry organizations such as America's Health Insurance Plans. The American Medical Association also has been one of the top contributors to individual Blue Dog members over the past 20 years.

Progressives are running the absolute right game in the House, forcing compromises in their direction and making sure they will be heard in this debate. Unfortunately, on the other side of the Capitol, you have health care policy literally in the hands of Chuck Grassley, who is promising his party he won't strike a deal on any bill with Democrats while SITTING IN ON MEETINGS AIMED AT STRIKING A DEAL in the Senate Finance Committee. The unicameral legislature concept is looking better and better every day.

We're Here, We're Progressive, Get Used To It

House progressives have really tried to throw their weight around on the deal put together between Henry Waxman and the Blue Dogs. They probably should get the full list of co-signers before releasing it, but still, this represents a rare step for the Progressive Caucus in taking a stand against compromise after compromise with the conservative wing of the party. I hear they got 53 members to add their names to this:

We write to voice our opposition to the negotiated health care reform agreement under consideration in the Energy and Commerce Committee.

We regard the agreement reached by Chairman Waxman and several Blue Dog members of the Committee as fundamentally unacceptable. This agreement is not a step forward toward a good health care bill, but a large step backwards. Any bill that does not provide, at a minimum, for a public option with reimbursement rates based on Medicare rates - not negotiated rates - is unacceptable. It would ensure higher costs for the public plan, and would do nothing to achieve the goal of "keeping insurance companies honest," and their rates down.

To offset the increased costs incurred by adopting the provisions advocated by the Blue Dog members of the Committee, the agreement would reduce subsidies to low- and middle-income families, requiring them to pay a larger portion of their income for insurance premiums, and would impose an unfunded mandate on the states to pay for what were to have been Federal costs.

In short, this agreement will result in the public, both as insurance purchasers and as taxpayers, paying ever higher rates to insurance companies.

We simply cannot vote for such a proposal.

At issue seems to be the reimbursement rates for the public option, which seems odd to me, because the Medicare +5% rates in the House Tri-Committee bill only exist for the first three years, and the negotiated rates from the Health and Human Services Secretary will presumably be improved over that of private industry. I agree about the lower coverage subsidies, but again, we're talking about 1% on those between 300 and 400% of the federal poverty level, which is not determinative. Finally, looping back to the public option, I agree that bargaining rates are important, but even if they are restored, the fact that relatively few people can access it because it's firewalled for people who get health insurance from their employers seems to be a MUCH bigger problem.

If you're interested in covering people, the primary questions are the subsidies, the employer mandate and the individual mandate. If you're interested in reforming the system, the primary question is the strength of the Health Insurance Exchanges. And if you're interested in the public plan? It's the Health Insurance Exchanges. Again.

In all the bills we've seen, the public option is on the exchange. It is only available to those who are able to buy into the exchange. But most Americans can't buy into the exchange. They're not allowed. To make this very clear, imagine that the House and the Senate both pass Henry Waxman's proposal tomorrow. Liberals would celebrate. That's got a good, strong public plan. And I can't use it. Not even if I want to pay for it out-of-pocket. I work at a large employer and thus I am not allowed to buy into the exchange.

A strong public plan on a weak exchange will fail because it won't attain sufficient market share. It's as simple as that. Conversely, even a weak public plan on a strong exchange could thrive, because it would have access to a lot of customers. Focusing on the public plan and ignoring the rules of the exchange is like focusing on engine power but ignoring whether people can buy the car.

And the one remedy for this problem, the Free Choice Act, which would give employees the choice to take employer coverage or use that money on the insurance exchange, is being pushed by Ron Wyden but virtually nobody else, certainly not House progressives or the larger progressive activist community.

(Now, I will say that Matt Yglesias' contention that the exchanges aren't the most important part of reform, but the insurance regulations are, when things like rescission and pre-existing conditions don't apply to the employer market either, is a little weird. An exchange that has all of those consumer protections on the insurance industry AND is available to anyone who wants to buy in would be a game-changer, particularly with a public plan providing competition inside the exchange.)

So, if progressives are vowing not to vote for deals that don't even contain the kinds of reforms they'd want, what's going on here? I think Ezra Klein has it right.

House liberals are afraid of the dynamic in which good bills face Blue Dog opposition in the final mile and are aggressively watered down. Senate liberals are afraid of the same. And throwing this final compromise with the Blue Dogs into doubt is a show of strength. After all, House liberals feel they've already compromised plenty: Coming down from single-payer is a compromise. Cordoning the public plan off on the Health Insurance Exchange is a compromise. The whole bill is one big compromise, and every subsequent iteration is a compromise stacked atop a compromise placed upon a compromise. At some point, the compromises have to stop. Or, better yet, they have to go in the other direction.

Yep. This is not about the specifics of the bill as much as it is about changing the general dynamic. It shows me that progressive lawmakers are learning from the mood of the grassroots, who have been demanding this for a while. Furthermore, they can add that, if health care goes down, the people on the front lines will be the ones who wouldn't deliver what the people wanted and are in the kind of districts most likely to flip to Republicans. I'm sure that progressives are mindful that a half a loaf bill will open them up to challenges from the left, too.

Enzi Invents New Six-Member Unicameral Parliament, Appoints Self Prime Minister

Steve Benen hit this yesterday, but I just noticed it. Mike Enzi, like most Senators, finds himself very, very important. So much so that he believes the November election leading to 60 Democratic Senators, 258 Democratic House members and a Democratic President sent the message that his word must be law.

With liberal Democrats on and off the Finance Committee already angling to pull the measure to the left when it is combined with a rival passed by the Health Committee, Enzi indicated his support is contingent on Democratic leaders leaving any Finance Committee agreement intact.

“I also need commitments from Sen. [Harry] Reid [D-Nev.] and Speaker Pelosi, as well as the administration, that the bipartisan agreements reached in the Finance Committee will survive in a final bill that goes to the president,” Enzi said.

There are six Senators involved in the Baucus caucus in the Senate Finance Committee. Together they represent about 2.8% of the total US population.

Let's add in some additional facts. Five Congressional Committees are working on health care legislation. The legislative process works like this: the bills coming out of the committees in the respective chambers are merged into single bills for a floor vote. Senators and House members have the opportunity to offer amendments. Those amendments are voted up or down, then there are final votes on passage of the bill in the House and the Senate. The bills coming out of the respective chambers go to a conference committee, where they are merged, with the details ironed out, and then returned to each chamber for a final vote.

That's how government works.

Mike Enzi's conception of government is this: Mike Enzi agrees to a compromise with 6% of the total Senate representing 2.8% of the population, and it becomes law.

I will say that his version has speed on its side.

The bill Enzi wants to fast track has a favorable CBO score going for it, reportedly costing under $1 trillion over 10 years and covering 95% of all Americans. But the only way to do that is to cut subsidies to the bone, making coverage unaffordable; or to phase in the program later in the ten-year budget window, maintaining the current broken, crappy system for as long as possible. It also apparently eliminates the successful Children's Health Insurance Program.

And by the way, they can't get it done until after the August recess.

Sen. Charles Grassley, R-Iowa, and Sen. Michael Enzi, R-Wyoming, dropped the bombshell news to CNN and two other reporters in Capitol hallways Wednesday night. They have spent weeks behind closed doors, trying to hammer out an agreement with their Democratic counterparts on the Senate Finance Committee but said too many issues remain unresolved, making it virtually impossible for them to sign on to a deal before the break.

“There are a lot of tough decisions to make and they aren’t going to be made real quickly,” Grassley said late Wednesday when asked whether negotiators should kick their talks over to September.

Senate Majority Leader Harry Reid, D-Nevada, had already postponed Senate floor action on health care legislation until the fall, but Democrats had hoped the Senate Finance Committee could finish its work before the summer break. In fact, one senior Democratic source said meeting that deadline was the central thrust of the president’s meeting with Reid and Finance Committee Chairman Max Baucus, D-Montana, last Friday [...]

Enzi, a soft-spoken conservative, was furious about headlines Wednesday morning that suggested he was close to reaching a deal with the Democrats.

“I felt my reputation was in danger,” he said.

In Enzi's world, signing on to a compromise with Democrats would ruin his reputation. So obviously we should just let him set the policy by himself. After all, 189,046 voted for him last year.

The silver lining here is that liberal Democrats in the House are resisting going along with this nonsense. From CongressDaily (sub. req.):

A trumpeted healthcare reform agreement with conservative House Democrats set off a firestorm of criticism from the party's liberal wing Wednesday, pushing back proceedings in a key committee and casting doubt on the strength of the leadership-backed accord.

Leaders and White House officials worked for days to reach an agreement with Blue Dogs, who had been holding up the legislation in the Energy and Commerce Committee because of concerns about cost, burdens on small business and a public insurance option [...]

"There's angst; there's questions; there's some anger," Rep. Eliot Engel, D-N.Y., a member of the Energy and Commerce Committee, said of the meetings with Waxman. "The question is, have we given up too much for the goals that we need?" he said of the agreement. "I don't want to see the insurance companies subsidized by middle-income taxpayers."

The Progressive Caucus called the Waxman/Blue Dog deal "unacceptable" and vowed to defeat such a compromise on the House floor.

Meanwhile, in the best news I've heard in years, Senate Democrats are making threats to Max Baucus' committee chair.

In an apparent warning to Senate Finance Committee Chairman Max Baucus (D-Mont.), some liberal Democrats have suggested a secret-ballot vote every two years on whether or not to strip committee chairmen of their gavels [...]

"Every two years the caucus could have a secret ballot on whether a chairman should continue, yes or no," said Sen. Tom Harkin (D-Iowa), the chairman of the Senate Agriculture Committee. "If the ‘no’s win, [the chairman’s] out [...]

Some senators suggest privately that Baucus might be more open to persuasion if his chairmanship is subject to regular votes.

Another senior Democratic senator endorsed Harkin’s suggestion but declined to speak on the record for fear of angering Baucus.

"Put me down as a yes, but if you use my name I’ll send a SWAT team after you," said the lawmaker when asked about a biennial referendum on chairmen.

Civil rights legislation in the 1960s didn't move forward until the House Rules Committee chair, a segregationist Southern Democrat, saw his power neutered by an expansion of the committee. Process changes often precede policy changes. Sen. Baucus, take note.

Hold Everything

Progressives on the Energy and Commerce Committee shut down the markup scheduled for this afternoon while they look at the compromise made.

House Energy and Commerce Chairman Henry Waxman (D-Calif.) postponed the health bill markup that he planned to hold Wednesday afternoon amid a backlash from liberals to the deal that he cut earlier with four conservative Blue Dog Democrats.

Waxman told reporters that he intended to keep meeting with committee Democrats on Wednesday night, resume the markup Thursday and still finish the bill Friday.

“[Energy and Commerce Democrats] have a lot of questions about the legislation, and I think it’s more important that we sit in the Democratic Caucus and let people ask questions, get answers, hear each other out,” Waxman said.

Good. As long as we're slowing down the bill, at least progressives can force some changes to it instead of going along with whatever compromise gets hashed out by the Blue Dogs. They should also inform their counterparts, many of whom come from rural areas, that they'll never vote for their farm subsidies if they sabotage this bill. They won't vote for their pork barrel projects and will join with Republicans to take them out of appropriations. They will simply make it difficult for Blue Dogs to bring home the bacon in the way they currently do. The Blue Dogs exist through power in numbers. The Progressive Caucus has MORE numbers, and they can use them.

Movement

Regardless of the Blue Dog pushback and all the other slings and arrows lodged at health care, some potentially big news has come down in the past 24 hours.

First, the Congressional Progressive Caucus has produced the names of 50 members who will not vote for health care without what they call a "robust public option." Robust is in the eye of the beholder, of course, and the one the House proposed would only cover 9 million or so people, which may not be enough to reverse incentives in the industry, but they drill down pretty far into the meaning of robust:

Enact concurrently with other significant expansions of coverage and must not be conditioned on private industry actions.

Consist of one entity, operated by the federal government, which sets policies and bears the risk for paying medical claims to keep administrative costs low and provide a higher standard of care.

Be available to all individuals and employers across the nation without limitation

Allow patients to have access to their choice of doctors and other providers that meet defined participation standards, similar to the traditional Medicare model, promote the medical home model, and eliminate lifetime caps on benefits.

Have the ability to structure the provider rates to promote quality care, primary care, prevention, chronic care management, and good public health.

Utilize the existing infrastructure of successful public programs like Medicare in order to maintain transparency and consumer protections for administering processes including payment systems, claims and appeals.

Establish or negotiate rates with pharmaceutical companies, durable medical equipment providers, and other providers to achieve the lowest prices for consumers.

Receive a level of subsidy and support that is no less than that received by private plans.

Ensure premiums must be priced at the lowest levels possible, not tied to the rates of private insurance plans.

In conclusion, the public plan, like all other qualified plans, must redress historical disparities in underrepresented communities. It must provide a standard package of comprehensive benefits including dental, vision, mental health and prescription drug coverage with no pre-existing condition exclusions. It must limit cost-sharing so that there are no barriers to care, and incorporate up-to-date best practice models to improve quality and lower costs. All plans, including the public plan, must include coverage for evidence-based preventive health services at minimal or no co-pay. All plans, including the public plan, should be at least as transparent as traditional Medicare.

I now think that the public option will be a feature of whatever gets signed by the President. The House is providing a progressive firewall, and most of the objections of the Blue Dogs and others are over other aspects of the bill. What's more, the American Medical Association, scourge of universal health care for decades, has blessed the House bill, which is remarkable.

And that makes it a pretty big deal. No, the AMA is not as powerful, nor as representative of the medical community, as it once was. But an unqualified endorsement for the most liberal plan out there has large symbolic value, given the role AMA played in killing health care reform for most of the 20th Century.

So what's in it for the docs? The medical community came into this debate with two big concerns. One is the financial and emotional burden of malpractice lawsuits. The other is the annually scheduled reduction in Medicare payments, known as the Sustainable Growth Rate (SGR) formula, that the AMA and other physicians lobbies end up fighting every summer when it's about to take effect [...]

Changing the SGR is expensive, probaby $200 to $300 billion over the course of ten years, depending on the details. And that's on top of the cost of expanding insurance coverage. But, to be clear, the SGR adjustments were becoming a farce. If they are part of a package that includes payment reforms designed to improve quality and reduce health care costs over the long run, it'd be money well spent.

Nobody in Washington supports legislation without getting something for themselves, but I agree with Cohn that this looks like a decent enough deal.

And now, the Senate Finance Committee thinks his committee will have a deal on his bill by the end of the day.

Senate Finance Committee Chairman Max Baucus (D-Mont.) said Thursday that he hopes to have a bipartisan deal on a health care reform bill by the end of the day.

He made the remarks after huddling for about two hours with five Finance Committee members most closely involved in the negotiations. It was the first time Baucus acknowledged a time frame for reaching an agreement.

“We are meeting very aggressively today,” Baucus said of the bipartisan group, which plans to meet again at 1:30 p.m. “We will keep meeting all day long. I hope we can reach some kind of agreement by the end of the day, but having said that, it depends on what kind it is.”

If the Finance Committee can get a bill reported out, suddenly the chances of a bill become much greater. What form that bill will take, of course, is open for debate.

Obama's Role In The Health Care Debate

Michael Tomasky says it's time for Obama to knock skulls over health care reform, and he's right. Congress will find this issue difficult to steer unless the President uses some of his political capital, because of the peculiarities of that institution.

Simply put, legislators are rarely courageous. They're not leaders. They're followers. They don't like doing risky things. They like doing things they know are popular.

Think about it. When a case emerges that puts a new twist on, say, child molestation, legislators rush forward with new laws meant to address the problem. The public will back them, and child molesters don't have a lobby.

But changing the country's healthcare system? That's big, and terrifying. It requires taking chances, doing things a new way. Legislators hate that.

In the healthcare case, we can add an ideological element to this. Democratic legislators currently in Congress now have served almost their entire careers during an age of conservative dominance. They've been trained over the course of two or three decades to hear and respond to certain dog whistles.

Lower taxes. Breathe out. Good. More regulation. Tense up. Risky. Free market. Smile. Good. Government. Clench teeth. Scary.

I'm telling you, legislators "reason" in those flash-card sequences. Then, the next thing they think of is their district or state, and they rarely think about the new votes a courageous stand might win them. Instead, they focus nervously on where they might lose votes (and local political, financial and editorial support) as a result of doing something out of the ordinary.

Third, they think of their Washington donor base, and exactly how much money taking an unorthodox position will cost them. Most of them know down to the dollar.

I don't think it's quite as bad as Bill Maher puts it, but yes, it's pretty bad. So Obama clearly has to get involved. And he's starting to do that, with a press conference coming up today, the ABC town hall (although that may come at the issue from the right), and generally a longer shadow cast over the debate. Whether he takes charge now or later, clearly he's edging in to take charge at some appointed moment.

For now, the White House should have as little to do as possible with the various legislative products. Let the committees absorb the blows of the bad weeks. Let the early coalitions present themselves. Let the Republicans show their strategy in the mark-up sessions. Let the CBO score all the different options. Let the legislature familiarize itself with different revenue options. Wait. Wait and wait and wait. Wait until Congress has pushed this as far upfield as it's able.

Then open up the White House. Then have Obama on TV. Then have Rahm on the phone with legislators. Then take Olympia Snowe for a ride on Marine One. The White House can exert explosive force on a piece of legislation, but it can only do so effectively for a short period of time. That was the mistake Clinton White House made in 1994. By the time their legislation was near reality, administration officials were so deeply involved that they couldn't add external momentum. It is not a mistake that Rahm Emmanuel, who watched it all happen firsthand, means to repeat.

But what form will this take? I don't see him as the guy saying "I will veto any bill that doesn't include X," which is what's needed at some point. I think this is a very innovative way to drive the debate, with thousands of horror stories that can be deployed to rebut conservatives or inform the press.

In a major new effort to throw Obama’s campaign apparatus into the push for health care reform, the White House’s political operation is set to launch a massive new online data bank of thousands of health care stories, which will be spread around the country via Obama’s extensive email list, officials familiar with the project tell me.

The new “health care story bank” — as it’s dubbed by Organizing for America, Obama’s reconfigured political and campaign operation run out of the DNC — is perhaps the most ambitious test case yet determining whether the technological apparatus that fueled Obama’s campaign can succeed in driving Obama’s governing agenda [...]

These stories, which OFA had been collecting on its Web site but had not released, will be disseminated to the massive OFA email list, in hopes that campaign-style organizers around the country will use powerful first-hand anecdotes to argue the case for reform — and to push back on opponents’ talking points. There will also be a tool that allow users to flag particular stories as deserving of more attention.

If you collect enough anecdotes, maybe the plural will in FACT be data.

As much as Obama can drive the health care debate, so can a Progressive Block. Conservative Democrats get so much purchase in Washington partially because the town is wired for conservatives, but also because they have the numbers and the will to stop legislation or allow it to move forward. Progressives also have those numbers, but not the will. Until Progressives align themselves, and say forcefully that no legislation will move without their satisfaction, nothing will change on the dynamic in Congress. Conservatives will hijack the debate and force concessions that water down the President's campaign agenda, one which the public voted for in record numbers

Time and time again, conservative Democrats representing between 10% and 25% of their chamber's Democratic caucus have formed a block, joined with Republicans, and successfully weakened, severely threatened, or entirely blocked key elements of the progressive legislative agenda. They were successful in every case despite the ostensible, public support for that agenda by the Obama administration [...]

Instead of 60 votes in the Senate, what progressives need is Democratic control of both branches of Congress, control of the White House, and a progressive block of at least 13 Senators and 45 House members that will vote against Democratic legislation unless their demands are met. What we need is our own version of the Blue Dogs and Evan Bayh's "conservodem" Senate group that is large enough, and staunch enough, to be able to block Democratic legislation by joining with Republicans.

We need this group to draw hard lines in the sand for the two biggest legislative priorities of 2009: health care and climate change. The group needs to make it clear that, if their demands are not met, then no climate change or health care legislation of any sort will be passed. Demands like:

Health care: A public health insurance option that is immediately available to all Americans.
Climate change: Restoring the EPA's ability to regulate carbon and renewable energy targets that surpass those put in place by China..

We actually have this in health care; the Progressive Caucus has vowed to vote against anything that doesn't have a strong public option. So I question the President-centric view of how health care can work. Progressives in the House can drive this as well.