GOP senators: Bipartisan health deal tougher now

WASHINGTON — Republican senators said Thursday prospects for a health overhaul deal dimmed after President Barack Obama declared his strong support a public insurance plan.

Such a plan would compete with private insurers and is opposed by nearly all Republicans. Until Wednesday, the administration had stepped carefully around the issue while emphasizing hopes for a compromise bill.

That changed when Obama released a letter to two Senate Democrats saying he believed strongly in the need for a new public plan.

"Didn't help. It hurt" the chances for a bipartisan agreement, said Sen. Mike Enzi of Wyoming, top Republican on the Senate Health, Education, Labor and Pensions Committee.

"We were making great progress up until yesterday," Sen. Judd Gregg of New Hampshire, the top Republican on the Senate Budget Committee, told CNBC. "The president laid down a fairly significant partisan marker when he said the proposal has to have a public plan."

Added Sen. John Ensign, R-Nev.: "If he wants a bipartisan bill, he has to recognize that a government-run plan doesn't get you to a bipartisan plan." Ensign spoke in an interview following a Senate Finance Committee meeting on the legislation. The committee is taking a lead role in developing a health care bill.

Supporters of the public plan contend it would give people more choices, create more competition and "keep insurance companies honest," as Obama wrote Sens. Edward Kennedy, D-Mass., and Max Baucus, D-Mont.

Kennedy heads the health committee; Baucus is chairman of the finance committee.

Opponents say private insurers could not compete with a public plan that didn't have to make a profit. They argue that private health plans would go out of business, leaving only an entirely government-run health care system.

The goal of overhauling the health care system is to lower costs and extend care to 50 million uninsured people. Obama wants a bill on his desk in October.

Kennedy has committed to having a public plan in his legislation. The more moderate Baucus also supports a public plan but he has tried to keep Republicans on board so his committee can produce a bipartisan product.

The private meeting that Baucus convened Thursday didn't appear to move him closer to that goal. A few Republicans emerged visibly frustrated. Baucus acknowledged that he was frustrated, too, while saying he was "searching to find that bipartisan solution."

The committee's top Republican, Chuck Grassley of Iowa, said Wednesday that Obama's letter was "helpful because of his statements that reform legislation needs to have bipartisan support." But after Thursday's meeting, Grassley avoided reporters, breaking into a sprint after exiting the meeting room.

Congress might be able to pass a health overhaul bill with little, if any GOP support. But Obama, Baucus and others have said they want to avoid that outcome because such a measure would be less widely supported and less sustainable over time.