White House Says Gov't-Run Insurance Not "Essential"

Top Democrats say nonprofit insurance co-ops could work, too

Monday, Aug 17, 2009  |  Updated 7:43 AM EDT
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Obama still believes there should be "choice and competition" in the health insurance world, but a public option is not "essential" to the Obama administration's health care overhaul, Sebelius said.

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The health care debate has entered a new phase after Health and Human Services Secretary Kathleen Sebelius and other high profile Democrats said the White House could accept nonprofit insurance groups instead of a government-run public option as the alternative in its new health care plan. The move could please Republicans worried about the overhaul but deflate President Obama's core liberal supporters. 

Obama still believes there should be "choice and competition" in the health insurance world, but a public option is not "essential" to the Obama administration's health care overhaul, Sebelius said Sunday on CNN's "State of the Union." Obama's chief advisor, David Axelrod, added in an interview with the New York Times that the specifics of how to create a non-profit alternative to private insurance were never "carved in stone."

Republican Sen. Richard Shelby said he and other Obama plan opponents could potentially consider the privately-run cooperatives as a workable alternative to government care. "That's something we should look at," he said on "Fox News Sunday."

On Saturday, Obama -- who has long advocated the public option -- appeared to lay the groundwork for a policy shift at a town hall meeting, where he said the public plan provision was just a "sliver" and not "the entirety" of health reform. 

Read more: MSNBC, New York Times, Politico

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