CNN: White House Negotiating With Snowe Over A ‘Trigger Public Option’

CNN’s Ed Henry and Dana Bash are reporting that the White House is negotiating with Sen. Olympia Snowe (R-ME) — a member of the so-called Gang-of-six tasked with producing a bipartisan health care bill in the Senate Finance Committee — to pass a “scaled-back bill that would focus on insurance reforms that both sides could agree to, but would not have a full public option, instead, would have a so-called trigger.” The negotiations come in advance of the Presidsent’s September 9th address to a joint session of Congress, in which Obama is expected to lay out a specific vision for health care reform:

What we’re hearing that she’s talking about with White House staff is sort of a scaled-back bill that would focus on insurance reforms that both sides could agree to, but would not have a full public option, instead, would have a so-called trigger. What that means in layman’s terms is basically that the insurance companies would have a couple of years to make some dramatic changes. If they do not make those changes, then a public option would be triggered.

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Indeed, a trigger proposal would establish certain benchmarks: if private insurers fail to lower premiums by X% over Y years, then a public plan would enter the Exchange. To convince private insurers of the threat of public competition and maximize the effectiveness of the mechanism, policy makers would begin designing a robust Medicare-like program almost immediately after passing health reform legislation.

The White House’s embrace of Snowe’s proposal signals that it has lost confidence in Sen. Kent Conrad’s (D-ND) co-op compromise, a development that could appease Congressional liberals weary of the co-ops’ ability to lower health care spending. Conservative Democrats may also support a compromise that gives private insurers one final opportunity to lower health care costs without government interference.

The White House hopes “that this would appease liberals by saying it’s not completely off the table. And the big hope is that this could bring along another moderate Republican, like maybe Susan Collins of Maine, some conservative Democrats, like Ben Nelson and Mary Landrieu in the Senate, who don’t want a public option, but would sort of potentially be open to a trigger like this,” Ed Henry said.

This morning, The New Republic’s Suzy Khimm reported that Snowe — a long-time supporter of fairly robust health insurance reforms — may also be willing to push-up the subsidy levels from 300 to 400% of the Federal Poverty Line, include large businesses in the Exchange (under the House bill, large businesses would not be able to enroll their employees in the Exchange until 2017), and do more to prohibit insurers from discriminating against older beneficiaries.