WASHINGTON- -As they debate how to give more Americans health insurance coverage, Senate Democrats are moving toward a showdown over whether to create a new government insurance program or set up a system of health insurance cooperatives instead.
A government-sponsored insurance plan, which has been endorsed by President Barack Obama, is a centerpiece of the health care bills developed by senior House Democrats and by Sen. Edward M. Kennedy and other liberal Democrats in the Senate.
Many Democrats have indicated they will settle for nothing less, arguing that only a government insurance plan can effectively compete with private insurers and offer Americans a real alternative to commercial insurers that many blame for denying people care and driving up costs.
But a bipartisan group of centrist lawmakers in the Senate Finance Committee have nearly settled on cooperatives as an alternative that, they say, could offer Americans more choice without further enlarging the government's role in the health care market, as many Republicans fear a government plan would do.
Cooperatives exist in different forms, but they are generally owned by their members, are structured as nonprofit groups and either own a system of health care providers or contract for medical services for their members.
The bipartisan Senate group, led by Montana Democratic Sen. Max Baucus, chairman of the finance committee, is planning to present its proposed health care bill by the end of next week, before lawmakers leave Washington for their August recess. Senate leaders plan to merge the proposals from Baucus' finance committee and Kennedy's health committee over the August recess and bring a combined bill to the Senate floor for debate in the fall.
Baucus and others in the bipartisan finance group, including Iowa Republican Sen. Chuck Grassley and North Dakota Democratic Sen. Kent Conrad, have argued that their proposal - including the cooperatives - offers the only hope for achieving the kind of consensus on health care that could prevent a GOP filibuster this year.
"Every single Republican is opposed to a public plan," Conrad said in a recent interview. "If one just does the numbers, it's very clear to get the votes, you've got to find some compromise here."
Conrad is the leading champion of co-ops, which he has said would be controlled by consumers rather than by the government or by profit-driven insurance companies that have to answer to their shareholders.
Under Conrad's proposal, the federal government would provide "seed money" help set up the cooperatives, but then require them to sustain themselves with the premiums they charge customers.
Though once much more popular, several insurance cooperatives exist nationwide in various forms.
Cooperatives often bring together primary care doctors, specialists and clinics and hospital staff in a coordinated system of patient care. Many health care experts believe that such integrated systems offer the best hope for improving the quality of care that Americans receive and simultaneously reducing costs.
Many Senate Democrats oppose the idea of substituting a plan for cooperatives for the idea government-sponsored insurance program. "It's pretty clear what the overwhelming number of Democrats want ... and it's a strong public option," said Ohio's Sherrod Brown.