Democrats Agree To Tentatively Trade Opt-Out For Trigger, Medicare Buy In, And More

December 8, 2009 5:19 p.m.

An aide briefed on the negotiations among the gang of 10 offers up the rundown of the most important aspects of the public option compromise being sent to CBO.

If this trade-off carries the day, the opt out public option is gone.

In its place will be many of the alternatives we’ve been hearing about, including a Medicare expansion and a triggered, federally-based public option, the aide said.

As has been widely reported, one of the trade-offs will be to extend a version of the Federal Employees Health Benefits Plan to consumers in the exchanges. Insurance companies will have the option of creating nationally-based non-profit insurance plans that would offered on the exchanges in every state. However, according to the aide, if insurance companies don’t step up to the plate to offer such plans, that will trigger a national public option.

Beyond that, the group agreed–contingent upon CBO analysis–to a Medicare buy in.That buy-in option would initially be made available to some uninsured people aged 55-64 in 2011, three years before the exchanges open. For the period between 2011 and 2014, when the exchanges do open, the Medicare option will not be subsidized–people will have to pay in without federal premium assistance–and so will likely be quite expensive, the aide noted. However, after the exchanges launch, the Medicare option would be offered in the exchanges, where people could pay into it with their subsidies.

It appears as if liberals lost out on a Medicaid expansion that would have opened the program up to everybody under 150 percent of the poverty line. That ceiling will likely remain at 133 percent, as is called for in the current bill.

In addition to the new insurance options, the group has tentatively agreed to new, and strengthened, insurance regulations, which the aide could not divulge at this time.

As with the process Senate Majority Leader Harry Reid undertook in merging the Senate Finance Committee and Senate HELP Committee bills, CBO will evaluate a menu of options, some of them interchangeable, so there’s no certainty that this list won’t change in the coming days. However, a separate senior leadership aide says that all of the options sent to CBO include the (triggered) public plan. Reid and other senators declined to offer specifics earlier tonight, as part of an agreement with CBO not to publicly discuss the policy options on the table while actuaries analyze competing ideas.

Now it’s a question of what the CBO says, and then: will Joe Lieberman object to the trigger? This trigger seems awfully hard to pull. But he’s said he’d filibuster any kind of government insurance option–even triggered–in the past. And if he’s out, what will Olympia Snowe do?

Late Update: The White House sends over a thumbs-up.

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