Target: Blue Dogs

House Democrats, who’d hoped to build momentum for health reform by passing a bill before the August vacation, hit a wall in the form of conservative-leaning Democrats who’ve protested the overall costs, low payments to rural health care providers, and the inclusion of a public option.

Yet Yale University political scientist Jacob Hacker makes a good case today why the policies on which the Blue Dog Democrats have hinged their opposition are the same provisions that would most help the lawmakers’ constituents.

Increasing rates to doctors and hospitals in rural areas, for example, would “fail to address excessive payments to hospitals and specialists that private insurers say they have lacked the leverage to bring down,” Hacker argues in The Washington Post.

Offering public plan rates at close to Medicare levels while giving doctors and hospitals the choice of accepting them — as the House legislation does — is a way to test the market. If providers accept the rates, as the CBO projects they will, the Blue Dogs will get what they want: lower costs. If not, the bill in the House contains provisions for adjusting the rates, including nearly $10 billion to raise rates in rural areas if an independent study determines that higher rates are needed.

Then there’s the issue of the government-backed health care plan to compete with private insurers. Many Blue Dogs have joined Republicans in arguing that the public option would have the unfair backing of the federal government, thereby threatening the private companies very existence. Yet, after decades competing only against each other, these companies have left more than 45 million Americans without any coverage at all. That trend, Hacker maintains, is indication enough that the public option is necessary as “a backup plan” for those who can’t afford private insurance.

A public health plan will be particularly vital for Americans in the rural areas that many Blue Dogs represent. These areas feature both limited insurance competition and shockingly large numbers of residents without adequate coverage. By providing a backup plan that competes with private insurers, the public plan will broaden coverage and encourage private plans to reduce their premiums.

Not that all the Blue Dogs are on the same page on the public plan issue. Rep. Jim Cooper (D-Tenn.) told CNN this morning that he supports the public plan, as long as it would slow the growth of health care spending, which threatens to topple the entire economy in just a few decades. Cooper suggested that the debate over the public plan has been hampered by ideologues on both sides of the argument, who react instinctively to the concept without recognizing its many nuances.

Months ago, I did a memo outlining 18 possible public options. There are different ways to do this. So many advocates of public option don’t really know specifically what they’re advocating and so many opponents don’t really know what they’re opposing. So it’s important that we get the definition right.

As we wrote last week, there’s broad agreement among health care experts that, despite all the bumps in the road, something called health care reform will pass this year.  It’s highly likely, however, that the final bill will look much different than the versions we’ve seen so far.