NPR, however, presents a less optimistic take on what the next few years of health care is America could look like:

[Jamie] Court, the consumer advocate, says he’s happy the law now says policies can’t be rescinded unless companies can prove that a policyholder lied on his or her application, but that until 2014, when the requirement for everyone to have insurance kicks in, he’s still worried that rescissions could continue.

“It’s a great thing, but it’s not a panacea,” he said. “Words in a bill don’t mean enough to insurance companies until they’re backed up by a lot of big verdicts or the wrath of a regulator.”

What kind of lies can prompt an insurer to rescind a patient’s insurance? One example in the NPR story has a patient losing her insurance because the height she reported on her application was an inch off her measured height and her weight five pounds different.

Senate Majority Leader Harry Reid (D-Nev.) (The Washington Times/ZUMA Press)

Announcing the Democrats’ tentative deal on a public option, Senate Majority Leader Harry Reid (D-Nev.) said last night that the nascent proposal strikes a good balance between liberals, who say a federal plan will lower patient costs, and conservatives who want to limit the government’s hand in private markets.

“It has something that we think should satisfy everybody,” Reid said.

Well, maybe. But it also has something to rile everybody, which leaves the future of the still-vague proposal very much uncertain.

[Congress]Although Democratic leaders are keeping the details largely under wraps, the leaked elements include provisions that will be difficult to swallow for those on both sides of the nettlesome debate over the public insurance plan. Indeed, while the week-long negotiations were designed to win agreement between liberal and conservative Democrats, key figures representing both camps are still declining to endorse their supposed deal. Sen. Russ Feingold (D-Wis.), for example, has expressed reservations, and Sens. Mary Landrieu (La.) and Blanche Lincoln (Ark.) said Wednesday that they won’t advocate for the proposal before they see a cost estimate.

Central to the Democrats’ compromise is reportedly a strategy to table the public option in favor of hybrid national plans to be regulated by the government but administered by private companies. If those companies failed to meet certain cost and coverage thresholds, it would trigger the creation of a full-scale public option to compete directly with private plans.

The “trigger” proposal is hardly new to the health reform debate, and it’s certain to meet with resistance. Although Sen. Olympia Snowe (Maine), the only Republican to support the Democrats’ health reforms, has endorsed the trigger, others have vowed to kill the overall bill if such a mechanism is included. Sens. Bernie Sanders (I-Vt.) and Roland Burris (D-Ill.), for example, say the trigger doesn’t go far enough to encourage private companies to keep plans affordable, while Sen. Joe Lieberman (I-Conn.) has said it goes too far to encroach on private markets.

Even Sen. Jay Rockefeller (D-W.Va.), one of the 10 Democratic negotiators who crafted the compromise, has argued this year that the trigger proposal is a punt. “Historically, ‘trigger’ mechanisms have not been successful, and they are not a substitute for a strong public health insurance option,” Rockefeller said in an October statement, likely referring to the trigger in Medicare’s prescription drug benefit that was never pulled. “A ‘trigger’ simply delays price competition.”

Rockefeller’s office did not respond to a request for comment Wednesday.

Furthermore, the proposal to have the insurance companies administer the national plans leaves in place the same profit motive for denying claims that Democrats have attacked throughout the health reform debate.

“This legislation cannot simply be a huge subsidy to private insurance companies that will get millions of new customers and be able to raise their rates as high as they want,” Sanders said last month.

There are other red flags in the Democrats’ public-plan compromise. One provision, for example, would extend Medicare eligibility to include those aged 55 to 64. Liberals have long called for such an expansion of the single-payer Medicare program, but concerns have swirled around the level of reimbursement for health care providers, many of whom complain that rates are too low to see Medicare patients. A September study conducted by the Center for Studying Health System Change found that just over half of the nation’s doctors accept all new Medicare patients, while almost 14 percent will see none at all.

“Are providers going to be reimbursed at Medicare rates? That’s certainly going to be the issue,” said Julius Hobson, former lobbyist for the American Medical Association and now health policy analyst with the Washington-based law firm Bryan Cave.

Still another element of the Democrats’ deal would reportedly force private insurers to spend no less than 90 cents of each premium dollar on health-care services, as opposed to ads, salaries and other administrative costs. That proposal, however, is sure to rouse the opposition of the powerful insurance lobby and conservative lawmakers already critical of the degree to which the Democrats’ health reform bill intervenes in the private marketplace.

And it’s not only conservatives who might be wary. Indeed, when Rockefeller proposed a similar provision during the Senate Finance Committee’s debate on health reform, liberal Sen. Jeff Bingaman (D-N.M) emerged as one of the vocal opponents. Bingaman said the amendment, which would have set the floor at 85 cents on the dollar, was inappropriate “without more understanding of … what it will do to the insurance markets.”

These sticking points do nothing to mention the opposition that will likely surface in the House, where Speaker Nancy Pelosi (D-Calif.) has made the public option a centerpiece of the chamber’s health reform legislation.

The Democrats’ proposal is still young, of course, and by declining to release the details, Democrats have left themselves plenty of room to tweak the compromise in order to lure broader support. Still, with so many constituencies to satisfy at once, the bill’s success might just hinge on whether or not lawmakers are willing to hold their noses and vote in favor of major provisions they adamantly oppose. If Sen. Tom Harkin (D-Iowa) is any indication, that tendency might already be happening.

“Do I like it?” Harkin said Tuesday when asked about the compromise. “No, but I’m going to support it to the hilt.”

As the nation remains mired in a debate over health care reform and how to keep down the costs of expanding coverage, AAJ is trying to point out that Republicans claims that medical malpractice lawsuits are one of the big cost drivers is completely misleading. In fact, though malpractice claims and so-called “defensive medicine” does account for a small percentage of unnecessary costs, medical errors and the astronomical profits of malpractice insurers appear to be a bigger part of the problem.

AAJ’s report released today finds that the average profit of medical malpractice insurance companies is higher than 99 percent of all Fortune 500 companies and 35 times higher than the Fortune 500 average for the same time period; and malpractice insurers have seen their profit margins range from 5.9 percent to 74.8 percent, with an average of 31.2 percent. The report also finds that malpractice insurers have publicly overestimated their losses and underestimated their profits in an attempt to suggest the insurance business and medical practice in general faces a crisis that must be resolved by so-called “tort reform” — i.e., making it harder for patients to sue and to collect damages for their injuries.

“Insurance companies are gouging doctors on their premiums to mislead lawmakers,” said American Association for Justice President Anthony Tarricone, managing partner at Kreindler & Kreindler LLP, in a statement released with the report. “And today, injured patients are often left with no avenue to pursue justice, while health care costs continue to skyrocket.”

Reactions to President Obama’s speech to Congress on Wednesday continue to pour in. A Democratic National Committee internal memo shows that in a focus group, support for Obama’s health reform plan increased by nearly 40 percent among voters who hold a negative or neutral opinion of the president. They responded particularly favorably to his lines about holding insurance companies accountable; the memo encourages Democrats to continue using this language.

After a rough day yesterday, in which his opponent raised more than $400,000, Rep. Joe Wilson (R-S.C.) saw a return to greener pastures today. He’s now raised more than $200,000 around $700,000 (according to a “Republican source”) since his outburst during Obama’s speech. And his less-than-tactfully-presented charge that illegal immigrants would benefit from the proposed reform has Democratic leaders revisiting the relevant language. However, it does appear increasingly likely that he’ll receive a formal censure.

Sen. Olympia Snowe (R-Maine), the most likely Senate Republican to cross the aisle and forge a health care compromise, has confused some observers with her demands for altering the reform plan. She wants to increase the subsidy threshold from 300 to 400 percent of the poverty line, which would necessarily raise the price tag of the legislation. But she also wants to reduce the cost from $900 billion to $800 billion — evidently an arbitrary figure to create the appearance of concessions from Democrats. And Sen. Charles Grassley (R-Iowa) insists he’s still at the table, working toward a bipartisan agreement.

“Limiting the legal rights of patients will do nothing to  lower the costs of health care,” said Anthony Tarricone, the association’s president, on a conference call with reporters this afternoon. Tort reform became a rallying cry at town hall meetings in August when lawmakers talked to constituents in their districts about health care.

“The health care bill must reduce medical errors,” not reduce patient’s rights, he said, noting the shocking statistic that “98,000 people die every year from preventable medical errors. And that does not include those who are seriously injured.”

In fact, he said, studies show that medical errors are “the sixth leading cause of death in America—the equivalent of two jumbo jets crashing every day.”

The lawyers’ association opposes proposals to cap injured patients’ damages or to limit their right to sue — proposals often favored by physicians’ groups and Republicans. In fact, as I’ve reported before, public health experts agree that medical malpractice defense costs constitute a tiny portion of the nation’s spending on health care, while medical errors can actually be very costly. Meanwhile, states that have passed severe tort reform laws limiting damages have not seen a corresponding drop in health care costs.

Still, the existing medical malpractice system that requires injured patients to hire a lawyer and costly experts and fight their cases out in court for years isn’t generally considered the most efficient system, either. But experts agree that a frequently-cited alternative — a government-run panel of health experts that would hear and decide malpractice claims — would cost far more than the current system, and likely wouldn’t garner significant support from either major political party.

Sen. Max Baucus (D-Mont.) and Sen. Charles Grassley (D-Iowa) (WDCpix)

Liberals love it. Conservatives hate it. Moderates have proposed some compromises, and the Obama administration is weighing ways to appease all camps. Whatever battles are brewing in this year’s looming health care reform debate, none is likely to reach the intensity of that over a government-sponsored insurance plan.

Supporters of adopting a public plan, a national insurance program anyone could opt into, argue that it’s an indispensable component of the Democrats’ soon-to-be-unveiled health care overhaul proposals, providing an affordable option to patients and keeping private insurers honest through increased competition. But critics contend that a federal plan is the first step to a single-payer system, tipping the scales unfairly with government subsidies and threatening the very existence of the private insurance market.

Illustration by: Matt Mahurin

Aside from aligning Democrats against Republicans, the young debate is also threatening to put liberal Democrats at odds with moderates, incite another intra-party rift between Democratic leaders in the House and Senate, and leave President Barack Obama — who wants to pass reforms supported by all parties — struggling to find some middle ground.

The episode highlights the difficulties facing Democrats in Congress and the White House as they try this year to make good on one of their very highest legislative priorities: revamping the nation’s health care delivery system in an effort to cover the 46 million uninsured Americans and slow the skyrocketing growth in medical costs. The debate will be a test of the political skill and will of party leaders, who are trumpeting the urgency of health reforms at the same time they’re urging caution in enacting them; who are hoping to trim the fat in the health care system at the same time they don’t want to eliminate jobs in the middle of a recession; and who are proposing enormously expensive reforms at a time of record deficits.

Lawmakers will also have to contend with the powerful insurance industry, which opposes the adoption of a public plan — and is lobbying furiously to keep it out of the Democrats’ proposal.

On Friday, the debate over public plans was launched in full after news leaked that Sen. Edward Kennedy (D-Mass.), chairman of the Senate health committee, intends to include the government-sponsored option as part of his sweeping reform proposal, expected to be unveiled next week. The leak inspired thoughts that Kennedy’s bill would be much more liberal than that being drafted by Senate Finance Committee Chairman Max Baucus (D-Mont.), who works closely with Sen. Charles Grassley (R-Iowa), a fierce opponent of the public option.

Kennedy and Baucus insist they remain on the same page, issuing a rare Saturday statement vowing to craft “complementary legislation that can be quickly merged into one bill for consideration on the Senate floor before the August recess.”

Joseph Antos, a health-policy analyst at the conservative American Enterprise Institute, said the leak — probably intentional — was likely intended to send a message to liberal Democrats that Kennedy’s on their side. It might also have been a message to Baucus that he’d better be prepared to nudge his proposal left — a situation that puts the Senate Finance Committee chairman in a squeeze between an allegiance to party and the promise to find bipartisan consensus on health care reform.

“He wants to be left of the 50-yard line, but he doesn’t want to be too far left of the 50-yard line,” Antos said of Baucus. “It’s the sort of thing we’ve seen often out of the Finance Committee … There’s a lot of game-playing going on here.”

The same dilemma faces Obama, who appears torn between his support for a public plan and a desire to have a bipartisan bill. The White House did not return requests for comment Wednesday.

Supporters of the public plan option argue that it’s vital if Democrats hope to slow the growth of health care spending, which is skyrocketing at a rate well above that of the rest of the economy. A government-sponsored plan, they say, could provide cheaper coverage because it wouldn’t have to pay the marketing and outreach costs that burden private insurers; it would cater to more people, lowering costs for reasons of sheer volume, and it wouldn’t be bound to produce profits for shareholders.

There are other advantages to the public option. Ron Pollack, executive director of Families USA, a consumer health care group, pointed out that private insurers operating under Medicare have been known to alter the terms of coverage, leaving patients without necessary treatments. A public plan, Pollack argued, “provides some stability” to patients. The government option would also create an enormous database of health coverage information that could inform future policy decisions, Pollack said — information private insurers often won’t disclose for proprietary reasons.

Conservatives and the insurance industry have other thoughts. Summing up the criticisms of the public plan option, Senate Minority Leader Mitch McConnell (R-Ky.) on Tuesday argued that a federally subsidized plan could offer “artificially lower prices” that would quickly attract interest from individuals and businesses alike. The result, McConnell contended, would be the death of the private insurance market.

“The very concept of a government ‘option’ is itself misleading,” McConnell said on the Senate floor. “What starts out as an option could quickly become the only option.”

Sen. Judd Gregg (R-N.H.), who floated his own health reform proposal this week, said the public option would eventually lead to “delays and rationing” for patients.

“The first rule of health care is, do no harm,” Gregg told MSNBC Tuesday. “Well, one thing which would do serious harm would be if the federal government came in and stood between you and your doctor or created a system which led to delays and rationing, which is what a public plan would.”

Several proposals floated on Capitol Hill in recent weeks seek to satisfy both supporters and critics of the public plan option. Under one measure, sponsored by Sen. Charles Schumer (D-N.Y.), the government would administer, but not be permitted to subsidize, the public plan. Instead the plan would have to rely on premiums and co-payments to cover claims, like any other insurer. The Schumer plan would also force the public plan to pay health care providers at rates higher than Medicare pays.

Another proposal would offer private plans the opportunity to expand coverage and reduce rates on their own, with the public option kicking in only in regions of the country where the private market failed to meet certain minimum thresholds of coverage and cost. Opponents of that strategy, including Schumer, argue that the nation’s 46 million uninsured residents are evidence enough that those thresholds have already been met.

Antos, of AEI, said one of those compromises could work, but first the language surrounding the debate would have to change so that the Republicans who’ve so adamantly opposed the public option wouldn’t be seen going back on their word.

“You’ve got to find a face-saving way,” Antos said. “So the first thing you do, you don’t call it a public plan.”

Douglas Holtz-Eakin, former head of the Congressional Budget Office, said that, without any details, it’s still too early to speculate about the fate of public plans in the coming debate. “There are many different flavors of a public option,” said Holtz-Eakin, the chief economist for the 2008 presidential campaign of Sen. John McCain (R-Ariz.). “We’ve got to see a specific proposal.”

Robert Blendon, a professor of health policy at Harvard University, pointed out that, even if the Senate isn’t able to pass the public plan provision, House Democrats will almost certainly include that option in their version of the bill, which is currently being drafted by Reps. Henry Waxman (D-Calif.), Charles Rangel (D-N.Y.) and George Miller (D-Calif.). For all the controversy swirling around public plans, Blendon added, there’s a larger barrier to the Democrats’ push for health care reform this year.

“This is very contentious, but not as contentious as how they plan to pay for it,” said Blendon, an expert on the Clinton administration’s failed attempt to pass comprehensive health care reform in 1993. “If they can find savings someplace, they would not stop the train for this issue. They would find some Sen. Schumer-like compromise and push the thing on through.”

David Cutler, a health economist at Harvard University who’s advised the Obama administration, downplayed the significance of the partisan griping over public plans, arguing on Tuesday that overall support for health care reform this year remains as strong as ever.

“You see these sorts of splinters,” Cutler said, “but you don’t see anyone walking out yet … We are in so much better shape than 16 years ago.”