Stephen Crowley/The New York Times

So that’s it for the Senate Finance Committee debate on the public option, which ran almost six hours, with a 45-minute break for lunch.

The fact that the Schumer amendment picked up two Democratic votes should be a reassuring sign for supporters of a “public option” — a government-run insurance plan — even though liberals view the Schumer amendment as a weaker version than the Rockefeller proposal. But Tuesday afternoon’s votes highlight the tough fight ahead with conservative Democrats like Kent Conrad of North Dakota and Blanche Lincoln of Arkansas, who held out against the Schumer proposal.

The question now is whether the support shown today by at least some Democrats for the public option will be enough to persuade Senator Harry Reid of Nevada, the Democratic leader, to include it when he reconciles the Finance Committee bill with one from the more liberal health committee — which does include a public option.

That will be the big debate going on behind the scenes as the Finance Committee barrels through hundreds of additional amendments with the goal of wrapping up its bill by the end of the week.

Supporters of the public option hope that even if they cannot persuade Mr. Reid to include the measure in the combined bill, they have established enough momentum to bring it up on the Senate floor. Watch for the pressure on wavering Democrats from interest groups, like unions, to only increase.

The Schumer amendment picked up two Democratic votes over the Rockefeller amendment, winning over Bill Nelson of Florida and Thomas R. Carper of Delaware. But the bill still went down to defeat, with 10 in favor and 13 against. Again, no Republicans supported it.

In wrapping up the presentation of his amendment, Mr. Schumer addresses some of the criticisms from Republicans.

He asks, for example, if the state insurance commissioners are doing such a good job, why are premiums “going through the roof?”

Mr. Schumer also tries to explain to people who already have insurance why the country needs a public option. Medicare is going broke in seven years, he says, and then what? The costs in private insurance are going up even higher than Medicare.

For those whose employers pay for their insurance, Mr. Schumer said, their bosses will call them in, in three years or five years, and say they can’t afford to pay for their health care anymore. “The costs are going through the roof, and we have to try the two or three tools at our disposal,” which include fixing costs, setting up exchanges and a public option. He concedes he doesn’t have the 60 votes needed, but says he expects to get there.

In support of the Schumer amendment, Senator Cantwell, Democrat of Washington, says that without competition in the marketplace, “we are buying into an exorbitant increase in insurance premiums.”

Senator Baucus, the committee chairman, says he likes the Schumer amendment more than he liked the Rockefeller amendment but notes again that he doesn’t see how it could win 60 votes on the Senate floor and so is constrained to vote against it.

Senator Kyl, Republican of Arizona, says the public option is “a solution in search of a problem.”

Senator Bunning, Republican of Kentucky, is back on Medicare. He says it is “a good thing” but it is “failing the American people.”

He adds: “The private sector is not doing exactly what it should do with medical services, but it can.” He says the bill as written, without a public option, “tries to help it out.” But he stops short of saying he would support the Baucus bill.

Senator John Ensign, Republican of Nevada, doesn’t even like the idea of the government competing with the private sector. This is a tremendous expansion of the federal government, he says. The private sector can come up with solutions to control costs, he says.

My colleague, David Herszenhorn, who is also covering the Finance Committee proceedings, has just put up a Prescriptions post examining some of the differences between the Rockefeller and Schumer amendments, and their approaches to a government-run public insurance option. Read it here.

Senator Charles E. Grassley, Republican of Iowa, says he will vote against Mr. Schumer’s amendment (surprise!), although he prefers it to the Rockefeller amendment. He says it is “impossible” to create a level playing field between the private system and the government.

Besides, Mr. Grassley said, when Medicare passed in the 1960s, various promises were made — such as that Medicare would pay “reasonable” rates — and those promises were broken. When this public option starts costing too much, Mr. Grassley asks, “will Congress start breaking its promises again?” (He said that the government could set the rates and use its influence to lower costs and says this is also known as “price-fixing.”)

Senator Kent Conrad says he sees the Schumer proposal as a “significant threat” to hospitals in his state because North Dakota already has the second-lowest reimbursement rates in the country.

But Mr. Conrad says he likes the idea that Mr. Schumer is proposing a not-for-profit competitor. Still, he is concerned about the government’s running it. He seems still to prefer his own idea of co-ops, but he says the Schumer amendment could get at least close to 60 votes.

No sooner had Mr. Schumer finished than Senator Bill Nelson of Florida, who opposed the Rockefeller amendment, announced he would support the Schumer amendment. This is an early indication that the day’s strategy — of first offering the more robust public option from Mr. Rockefeller — may have some success. Some Democrats need political cover to vote for the Schumer amendment by having voted against the more liberal Rockefeller amendment.

Mr. Schumer immediately begins explaining his amendment, with no nod to the vote. He says his plan would create a level-playing field by forcing the government plan to negotiate its rates. He adds: “There will not be another federal infusion of federal dollars if it does not make it the first time around.”

“We are going to keep at this and at this and at this until we succeed, because we believe in it so strongly,” Mr. Schumer says. He says the vote on his amendment will show that there is support in the Senate for the public option. He says he understands Mr. Baucus’s opposition and appreciates that there might not be 60 votes now, but he expects that as the debate goes on, the public option will attract more support.

The Rockefeller amendment is voted down, despite Mr. Rockefeller’s declaration, “The public option is on the march.”

The final tally was 8 in favor, 15 against. The amendment drew no Republican support. Democrats voting against the amendment were Mr. Conrad, Ms. Lincoln, Bill Nelson of Florida and Thomas Carper of Delaware.

Supporting the public option were the Democratic Senators Rockefeller, Bingaman, Kerry, Wyden, Schumer, Stabenow, Cantwell and Menendez.

Senator Rockefeller, whose amendment on behalf of a public option is about to come up for a vote by the Finance Committee, says that his constituents in West Virginia feel “out in the cold” from the insurance companies.

“It’s not a fair system,” he said. “It’s a one-side system and people are on the short end of the stick” while insurance companies reap the profits. He says he doesn’t like the view of some who say that we need a bill, regardless of what it says — adding that he isn’t necessarily talking about President Obama.

Before Senator Rockefeller wraps up, Senator Baucus tries to sound conciliatory. “I can count,” he says, adding that no one has shown him how a public option could win 60 votes in the Senate, so he plans to vote against the amendment.

He also notes that Rome wasn’t built in a day. This bill is by no means a complete rewriting of the American health care system, Mr. Baucus says, but we need to start laying the foundation. He says a vote for the public option will jeopardize that foundation.

Despite what Mr. Kerry has just said, Senator John Cornyn, Republican of Texas, goes ahead and calls the public option an entitlement anyway.

He continues the Republican attack on Medicare and repeats the notion that a public plan will take away choices, not add to them.

Senator John Kerry, Democrat of Massachusetts, tries to draw a distinction between Medicare and the public option. Medicare, like Medicaid, is an entitlement, he notes, while the public option is not.

That prompts him to ask what the Republicans are really afraid of. Could it be competition? He holds up a chart, shown by other Democrats, indicating that in 10 states, 80 percent to 100 percent of the health insurance market is cornered by just two insurance companies.

What are we scared of, Mr. Kerry asks. “That Americans might like a competitive plan that is paying for itself?”



Mr. Baucus says the committee is “getting close to a vote,” but it has to hear from two more senators.

Senator Mike Crapo, Republican of Idaho, says a government-run plan would actually reduce competition because it would require “excessive” regulation and would pay at “inadequate” Medicare rates. Like other Republicans, he is using this opportunity to draw attention to various problems with Medicare.

Senator Maria Cantwell, Democrat of Washington, speaks in favor of the public option. But first, she slyly makes the point that if a state renders health care efficiently — a state, like, oh, say, North Dakota, home to Mr. Conrad, who opposes a public option — that state would be rewarded for its efficiency. Mr. Conrad was just returning to his seat as she was finishing her point, so it is not clear whether her fellow Democrat caught her drift.

Senator Jim Bunning, Republican of Kentucky, is first up after the break. He starts by pushing the idea that health insurance should be sold across state lines. He says that would obviate the need for a public option, which he opposes.

Mr. Bunning also takes up a widespread populist argument — that all members of Congress should be under the same health care plan as everyone else.

“If I heard one thing during August,” he said, it was this: “Why, Senator, are you not including yourself in what is being proposed?” His response, he said, was, “It’s not my bill, but I’ll try to make that change.”

As for the public option, he called it a “major step toward universal health care coverage.” With 40 grandchildren of his own, he said, he does not want the country to go in that direction.

The committee has gaveled back in from the lunch break…

The committee has recessed for lunch without taking any votes and will resume at 1:45. It is not clear when the first votes will come, but perhaps not for an hour or so after the senators come back from lunch.

We’ll plan to resume our coverage, when the senators return …

Debbie Stabenow, Democrat of Michigan, strongly supports a public option. She says one difficulty is that the United States has multiple systems: one for the armed forces and veterans that is wholly government-run; Medicare, which is single-payer and government-run; and one that is employer-based.

She calls the public option offered by Senators Rockefeller and Schumer “the grand compromise” that would give people more choice. About 25 percent of Americans who do not have insurance today will probably choose the public option, according to the Congressional Budget Office, and that won’t bring down the system.

“I don’t know what all the fuss is about,” she says, noting that the C.B.O. says it would save $50 billion for taxpayers over 10 years.

Senator Schumer cited the recent New York Times/CBS News Poll a few minutes ago, saying 65 percent of the public supports a public insurance option. But in fact, the Times survey found that the public endorses an even more expansive public option than the one under debate today in the Finance Committee.

As David M. Herszenhorn noted in a recent Prescriptions post, the Times/CBS poll asked: Would you favor or oppose the government offering everyone a government-administered health insurance plan — something like the Medicare coverage that people 65 and older get — that would compete with private insurance plans?



Mr. Herszenhorn went on to say this:

The poll question was phrased generally so that it could be asked in repeated surveys over time regardless of any specific legislative proposal.

With the question asked that way, most respondents supported the idea, with 65 percent in favor, 26 percent opposed and 9 percent offering no position.

But in Congress, none of the legislative proposals that include the public option would make it available to everyone. In fact, the public option, at least at the outset, would not be an option for most Americans, particularly those who already have health insurance.

Senator John Ensign, Republican of Nevada, asks: If a public option is so popular, why do so many Democrats have a problem with it? The reason, he says, is that it is not popular. “Constituents are really afraid of it,” he says.

“Despite the massive propaganda that’s been waged against” a public option, Mr. Schumer says, 65 percent of people support it, according to a New York Times/CBS News Poll. “Take off the ideological blinders on both sides and let’s see what works for people,” he says. He wants to give both public and private plans a chance to work, declaring himself “agnostic.”

Mr. Schumer is giving a tutorial in why there is so little competition in the insurance marketplace. Along the way, he gives a nod to Senator Maria Cantwell, Democrat of Washington, whom he calls “the unsung hero” of the bill for her amendment on costs, which will be brought up later.

Senator Schumer takes the floor to make the broad case for a public option …

Several of our readers noted that in our first draft below we misidentified Senator Bill Nelson, Democrat of Florida, as “Ben Nelson.” Senator Ben Nelson, of course, is the Democrat from Nebraska. We’ve fixed it below, but appreciate the help.

Mr. Conrad says that “we’ve gotten locked in a really sterile debate” that promotes either the status quo or the public option. He says he has a good alternative, which would be to set up co-ops, although he doesn’t spell out his proposal at this point. He merely says that this alternative has been adopted in other countries, provides universal coverage and does “a better job of controlling costs and have higher-quality outcomes than ours.”

Senator Kent Conrad, Democrat of North Dakota, has already signaled his dislike of the public option, and now, in this hearing, he is making it clear that a public option offered by his fellow Democrats will not win his vote.

The problem with Mr. Rockefeller’s proposal, he says, is that the reimbursement rates are tied to Medicare, which are lower than actual costs. In fact, Mr. Conrad says, his home state has the second-lowest level of Medicare reimbursement in the country. If North Dakota relied on Medicare levels of reimbursement, he said, “every major hospital” in his state would go broke. “I can’t possibly support an amendment that does that,” he said.

Senator Robert Menendez, Democrat of New Jersey, is allowed to speak out of turn because he has a pressing engagement elsewhere. He strongly backs Mr. Rockefeller’s proposal and says if that fails, he’s for Mr. Schumer’s. He makes pretty much the generic arguments on behalf of a public option, saying it will provide competition, will keep insurers “honest” and will drive down costs.

We’ve posted a copy of the Rockefeller amendment, calling for a public insurance option. See for yourself.



Mr. Grassley says if you want competition, “you don’t want the government” running health care. “It’s not a competitor, it’s a predator.” He says Medicare is “part of the social fabric of America,” but “there’s a lot wrong with it and this bill helps correct it.”

Senator Orrin G. Hatch, Republican of Utah, calls Mr. Rockefeller’s amendment “a Trojan horse” for a single-payer system. He adds: “Medicare is on a path to a fiscal meltdown,” underpaying doctors by 20 percent and hospitals by 30 percent, compared to private sector. He says this is forcing providers to “stop seeing our nation’s seniors.”

A lively three-way exchange, with Senator Bill Nelson, Democrat of Florida, entering the debate with Senators Schumer and Grassley. He establishes that some states have virtually no competition in health insurance: In Maine, one company dominates 88 percent of the market; Montana, 85 percent; Wyoming, 85 percent; Arkansas, 81 percent. “That doesn’t sound like a lot of competition to me,” Mr. Nelson says.

Senator Schumer has returned to the hearing room in his shirt sleeves, looking ready for a fight. He takes on Senator Grassley, asking him what he thinks of Medicare. Mr. Grassley says elliptically that by saying he supports Medicare is not to say that it is perfect.

In opposition to Mr. Rockefeller’s amendment, Senator Charles E. Grassley, Republican of Iowa, says “it is a slow walk toward government-controlled, single-payer health care.” He says there are problems and shortcomings with the health-care system, but that should not provide an opportunity to “denigrate American health care.” He says a government-run plan “will ultimately force private insurers out of business,” and that it may be a strategy to move over time to a single-payer system.

Winding up his argument, Mr. Rockefeller said a public option would rely on the free market, adding: “Adam Smith would have cooked up this amendment if I hadn’t.” He acknowledged that “people are nervous” about his amendment because “it has the word public in it” but it would provide genuine competition. Of the insurance companies, he said, “they’re getting away with banditry and they revel in it.”

Mr. Baucus said Mr. Rockefeller “makes good points and I agree with the intent of the amendment, to hold the insurance industry’s feet to the fire.” He said that “without taking a strong position one way or another,” he wanted to comment because “you leave the impression the mark is easy on the insurance industry, and it is not.” He said, for example, that the bill requires insurance companies to sell insurance to everyone who needs it and to renew their premiums as long as someone was paying for and that it required greater transparency.



In his impassioned speech just now, railing against the evils of the private health insurance industry, Senator Rockefeller just suggested that his colleague, Senator Charles E. Schumer, Democrat of New York, as a former attorney general, might have prosecuted some of the companies for their untoward practices.

Mr. Schumer is an ally of Mr. Rockefeller in seeking to add a government-run insurance plan or public option to the big health care legislation. But Mr. Schumer never served as attorney general. He was a New York State assemblyman, a United States representative and now a senator.

But Schumer aides said that the revision of his résumé would not in any way diminish Mr. Schumer’s support for Mr. Rockefeller’s amendment. — David M. Herszenhorn



Mr. Rockefeller has spent more than 40 minutes issuing broad indictments of private insurance companies, concluding, “I think they’re getting away with terrible things that, I don’t know, if Chuck Schumer was attorney general, he’d be criminally prosecuting them.” As it happened, Mr. Schumer was out of the room during that statement, so we have no response from him.

Senator Rockefeller says his amendment will save $50 billion and is practical and important. (The Congressional Budget Office has come up with the same savings estimate.) It is not a government takeover, he says. It is optional, nobody has to do it, and he says perhaps only 5 percent of people who are already insured will leave their plans. He notes that 70 percent of American people want a public option, as well as at least 70 percent of doctors. We need this option because insurance companies have failed to meet their obligations and are profit-oriented, he says.

The committee is starting now to discuss the public option, opening with Senator Rockefeller’s amendment.

Chairman Baucus has called the committee to order, on what is the fifth day of its hearings on its health care bill. It has considered 60 amendments so far — that’s about 10 percent of all amendments pending. Mr. Baucus announced the schedule for the day and it looks like a long one — he said the committee would break for dinner between 5:45 p.m. and 7:15 p.m. and then return.

Sent at 10:15 AM on Tuesday

Hi everybody.The Senate Finance Committee is filing into the hearing room and just about to get down to business. Senator Rockefeller had a little pat on the back for Senator Schumer as they took their seats; they’ll be the focus today as the committee takes up the public option.

The Senate Finance Committee resumes debate this morning on the health care bill. At the top of the agenda: a proposal for a government-run insurance plan — the so-called public option.

As proposed by the committee chairman, Senator Max Baucus of Montana, the bill does not include a public option.

But two Democratic senators, John D. Rockefeller IV of West Virginia and Charles E. Schumer of New York, intend to press the issue in separate amendments before the committee.

The prospects for passage there appear dim, but supporters hope they can build momentum by debating the issue now and holding a roll-call vote of committee members under the gaze of Democratic constituencies like labor unions, which strongly support the public option.

Supporters say a public option would drive down the cost of private insurance. But the insurance industry opposes it, saying lower-priced competition from the government would put private insurance companies out of business.

The supporters plan to continue pushing when Democratic leaders reconcile the Finance Committee’s bill with one from the more liberal Committee on Health, Education, Labor and Pensions, which already includes a public option, and when the resulting legislation goes to the Senate floor.

“Just bringing up this issue in the Finance Committee has helped to revitalize the overall push for it,” Brian Fallon, a spokesman for Mr. Schumer, said Monday. “Its chances only get better from here.”

We’ll join the committee session, live, in a few minutes.