Schumer: Conrad’s Co-ops Aren’t The Main Problem; Grassley’s Are

There have been a number of important one-off reports over the last few days on developments in the Senate Finance Committee’s health care legislation negotiations–co-ops vs. the public option–which, taken together, don’t really paint a complete picture of where things stand in that process. So let me do my best to tie it all together and place things in greater context.

Sen. Chuck Schumer (D-NY) is the committee’s point man on the public plan. That’s the role he was assigned by chairman Max Baucus (D-MT) when the process began, and it started with his suggestion that a government insurance option operate on a level playing field with private insurers; lower administrative costs, lower overall levels of waste, but barred from monopsonistically using the sheer enormity of the program to set lower prices.

Some conservative Democrats on the committee had “concerns” about Schumer’s plan, and Republicans were generally opposed, which put a crimp in Baucus’ plan to reach a bipartisan consensus–for all intents and purposes, to win the votes of ranking member Chuck Grassley and Olympia Snowe. That’s what ultimately created the political space for Sen. Kent Conrad’s plan to build a cooperative system, which Grassley said he was open to in principle.

There were just a couple significant problems with that.First, the co-operative plan Grassley might support is not a plan Schumer would abide by. “If the co-op option remains unchanged from what it is now he would not support it and he would urge other Democrats not to support it as well,” Schumer’s spokesman Brian Fallon told me.

And by the same token, a co-operative plan Schumer might support isn’t a plan Grassley could support. Conrad said earlier this week that he and Schumer don’t really disagree too much on the potential shape of the co-operatives–but Grassley’s still not on board.

So there’s a bit of an impasse, and committee leaders are struggling to reconcile a number of seemingly incompatible desires: The desire to build a bill that stands a chance of surviving in the House; the desire to move a bill out of committee with some Republican support; and the desire not to get further behind schedule than the committee already is.

My sense from talking to several people close to the negotiations–and keep in mind this isn’t happening in the most transparent possible way–that the first of these concerns is taking a back seat to the second and third. But, of course, the first concern is real–it’s quite possible that the House leaders and progressives will refuse the to sign on to a bill that doesn’t conform to the public option principles put forth by Health Care for America Now. And, for that matter, it’s not clear which Senate Republicans, other than the usual small handful of characters, would vote to end a filibuster on a major health care overhaul bill, even if they don’t in principle oppose a co-operative option. So far, in the Senate, it’s been treated with cautious optimism by, for instance, Sen. Susan Collins (R-ME), who said “I need to know more details. We need to better understand how it would work. But it’s certainly better than a Washington-run plan.” But there’s little, if any, indication that it would win over any new, more conservative faces. and that’s an awfully high price to pay for nominal bipartisanship.

So even if a co-op provision passes in the Finance Committee, the fight over the public option is far from over. Under normal circumstances, a filibuster might be enough to push the co-ops over the top. But, even if it’s a remote possibility, sources say the threat of the budget reconciliation process is still looming in the back of people’s minds, and that mitigates the threat considerably.

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