Key Dems: The public option is dead

After months on life support, the public option died Tuesday.

The White House and House leaders on Tuesday pronounced the government-run health program dead even as some Democratic senators continued their effort to resurrect it.

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The move is a clear indication that President Barack Obama and leading Democrats are wary of another intra-party battle on the public option. Last year, Democrats lost valuable time debating the issue, leading to many missed deadlines.

The number of Senate Democrats voicing support for including a public option in the final healthcare bill — and for using reconciliation rules to pass that legislation in the Senate — grew to 25 Tuesday. But that’s still 25 votes short, with little to no chance of reaching the necessary 50.

The White House on Tuesday squelched any momentum the public option had attracted over the last week.

At his daily briefing on Tuesday, White House press secretary Robert Gibbs said that Obama chose not to include a public option in the healthcare plan he released on Monday based on an acknowledgment that the Senate simply lacks the votes for such a maneuver.

“We have seen, obviously, that though there are some that are supportive of this, there isn’t enough political support in a majority to get this through,” Gibbs said. “The president … took the Senate bill as the base and looks forward to discussing consensus ideas on Thursday.”

The second-ranking Democrat in the House, where support for a public option had been the strongest, made similar arguments. House Majority Leader Steny Hoyer (D-Md.) indicated that the public option is likely dead, citing Obama’s decision not to include it in his healthcare proposal that was released on Monday.

Hoyer did say, however, that the House still has the votes to pass a public option. The House healthcare reform measure that passed in November called for a government-run program. The Senate-passed bill did not.

“But I think that it is obviously an item that the president has decided — he was for the public option as well — is not something that perhaps the Senate can buy,” Hoyer said.

The majority leader also said Democrats may pursue a scaled-back health bill.

At a Tuesday afternoon event previewing the House’s consideration of a bill to strip private health insurers of their anti-trust exemption, Speaker Nancy Pelosi (D-Calif.) did not criticize the lack of a public insurance plan in Obama’s bill, and also suggested that it simply may not have the votes to pass in the upper chamber.

“There are other ways to do that,” Pelosi said of mechanisms to create competition and lower healthcare costs. “We intend to do that in the bill. [The public option] seems to me the best way to us, but that will depend on what the Senate can pass on the Senate side.”

Even if Senate Democrats do not seek a public option, it remains to be seen if they have the votes to pass a healthcare bill through reconciliation. Adding a public option to the equation will likely cost them support.

Throughout much of the healthcare debate, liberals have pressured the White House to push lawmakers in both chambers to support a government-run healthcare plan. The White House has said it generally supports a public option but has refrained from demanding that congressional leaders include it in their legislation.

Tuesday’s comments from Gibbs drew an immediate and sharp rebuke from liberal groups, including the Progressive Change Campaign (PCC).

“The White House obviously has a loser mentality,” PCC co-founder Adam Green said in a statement. “Polls show that in state after state, voters hate the Senate bill and overwhelmingly want a public option, even if passed with zero Republican votes. More than 50 Senate Democrats and 218 House Democrats were willing to vote for the public option before, and the only way to lose in reconciliation is if losers are leading the fight.”

In a clear appeal to liberals, Obama widened the health insurance tax credits for low- and middle-income people, added stricter federal regulation of insurance companies and premium hikes and targeted the “doughnut hole” coverage gap in the Medicare prescription drug program.

Obama’s proposal also raises the dollar threshold of the excise tax on so-called “Cadillac” insurance plans so as to make the tax applicable to fewer people. His plan also delays the implementation of the excise tax until 2018, and would apply the tax exemption to anyone with a high-cost plan, not just to union workers. Liberals in the House especially had sought and won that concession in January before Sen. Scott Brown’s (R-Mass.) election derailed House and Senate negotiations.

Whether those concessions will satisfy liberals is unclear.

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“We’re taking it one day at a time,” Pelosi said Tuesday, a sentiment that was shared by many members of her caucus.

“We’re really beginning the process in the caucus over again,” said Rep. Peter DeFazio (D-Ore.), a supporter of reviving the public option through reconciliation. “There’s no fait accompli here, there’s been no whipping, there’s been no pushing. There’s been very little opportunity for members to respond so far. And they say we will have more sessions, particularly after Thursday.”

Rep. Jared Polis (D-Colo.) and Sen. Michael Bennet (D-Colo.) are spearheading efforts to persuade congressional leaders to include a public option in a final healthcare bill.

Walter Alarkon and Jeffrey Young contributed to this article.