Lieberman Opposes Public Option In Challenge to Reid

Connecticut Senator Joe Lieberman, an independent who generally votes with Democrats, said he opposes a government-run health-insurance program and won’t support the party in allowing a final vote on the measure.

“The last thing that we want to do now is create another Washington-run health insurance company,” Lieberman told reporters today in Washington.

Lieberman’s comments represent the first challenge to Senate Majority Leader Harry Reid’s plan to include a so-called public option in legislation to overhaul the U.S. medical system. Reid needs all 60 votes controlled by Democrats, including Lieberman’s, to pass the measure.

The proposal to create a public insurance program to compete with private companies is the most divisive element in the health-care debate. It has drawn opposition from every Senate Republican and some Democrats who say a government program would undermine the private market.

Lawmakers are trying to pass a bill that would cover tens of millions of uninsured Americans while curbing rising medical costs. Their proposals for new purchasing exchanges, subsidies and a requirement that all Americans have insurance represent the biggest changes to U.S. health care in four decades.

First Hurdle

Under pressure from leading Democrats and key constituencies such as labor unions, Reid yesterday said he would ask the Senate to vote for a public option that would allow states to opt out. Senate officials at the time said they didn’t yet have 60 votes for the plan, yet expressed optimism.

Reid’s first hurdle is to get 60 votes to bring legislation to the floor, and Lieberman said he would support him in that bid. Still, unless the bill is revised, Lieberman said he would side with Republicans in blocking a final vote.

Lieberman said the government can’t afford another entitlement program. “We’re having a hard enough time sustaining Medicare,” he told reporters.

“It’s just asking for trouble,” he said.

Other Senate Democrats who have been critical of the public option wouldn’t even commit to allowing debate to proceed.

“I’m not going to make up my mind until I’ve actually seen the bill,” said Senator Ben Nelson, a Nebraska Democrat. Democratic Senators Kent Conrad of North Dakota and Evan Bayh of Indiana said the same. Senator Mary Landrieu, a Louisiana Democrat, declined to comment on how she would vote.

Losing Republicans

The inclusion of the public option also means that Reid lost the support of the only Republican who has voted for any of the congressional bills so far: Maine Senator Olympia Snowe. Fellow Maine Senator Susan Collins said she can’t support Reid’s inclusion of a public option either.

“It was a mistake and forecloses any real possibility of Republican support,” Collins said. She’s one of the few Republicans besides Snowe who has been targeted by Democrats as a potential backer.

Snowe said today she can’t see voting to let debate begin on a plan with a public option.

“It’s very difficult to be in the position we’re in to try to make any fundamental changes,” Snowe said.

Senator Tom Carper, a Delaware Democrat, said Reid urged all Senate Democrats in a closed-door meeting today to vote in favor of letting the debate go forward, and urged those who have concerns with his public option proposal or other aspects of the bill to bring amendments to the floor.

Working With Lieberman

Reid told reporters he expects to work with Lieberman and other lawmakers to work out issues with the bill. “Joe Lieberman is the least of Harry Reid’s problems,” Reid said.

Reid is seeking a Congressional Budget Office cost estimate for the proposal. He has been melding a measure passed by the Senate health committee in July with an $829 billion plan approved by the finance panel on Oct. 13. The health panel included a public option; the finance committee rejected it.

In the House, legislation will include a public option. House leaders are still discussing what form it will take and plan to bring a bill to the floor next week.

“A bill is possible this week,” House Majority Leader Steny Hoyer, a Maryland Democrat, told reporters. “That would be our objective as we want to consider it next week.”

Cutting Fees

The House is likely to include a fee imposed on medical- device makers, said Democratic Representatives Bill Pascrell of New Jersey and Timothy Walz of Minnesota, where companies such as Medtronic Inc. are based. They said the fee would be about half the levy proposed in the Senate to raise $40 billion over a decade.

The House bill’s proposed reduction in the levy and starting the fees in 2013 would be an “incremental positive,” for device makers, said Adam Feinstein, a New York-based analyst with Barclays Capital, in a note to investors.

Based on market growth projections, the House fee would lower earnings for medical device makers as a group by 4.6 percent beginning in 2013, compared with the 7.2 percent reduction that Barclays estimates would result from the Senate Finance Committee proposal, Feinstein said.

If both the House and Senate pass their versions of the legislation, lawmakers from each chamber will work together on a compromise before a new round of votes.