Health care reform advocates in Congress and some conservative Democrats who have been resisting reform say the reported Senate compromise puts substantive health care reform within reach.
The deal expands the role of government in the nation's health care system. In place of a public option, it includes a choice from among nonprofit health plans under the oversight of the government's Office of Personnel Management. The government would negotiate with private benefit plans that mirror those offered to members of Congress.
The plan would also open Medicare to Americans at age 55, who could "buy in" to get that coverage.
The compromise features a trigger where the federal government could get more involved if insurance companies are not stepping in or are charging rates that are too high. The trigger could allow the government to add a public option.
President Obama praised the compromise as "a creative new framework that I believe will help pave the way for final passage of legislation and a historic achievement for the American people."
"I support this effort," he said, "especially since it's aimed at increasing choice and competition and lowering cost."
The provision that opens Medicare to uninsured individuals between the ages of 55 and 64 was lauded by some progressive lawmakers, including supporters of single-payer health insurance.
Rep. Anthony Weiner, D-N.Y., called it "an unvarnished, complete victory for people like me who have been arguing for a single-payer system." Weiner found irony in the compromise, saying, "This is the weirdest Kabuki dance. To get conservative Democrats, we have to expand the Medicare program."
Howard Dean, the former Democratic Party chairman and a backer of a government-run insurance option, said, "Using Medicare makes more sense than reinventing more bureaucracy."
Despite the praise from the president and many liberals, and the usual opposition from the Republicans, there are critics from across the political spectrum.
They include MoveOn.org., the progressive group, which issued a statement saying Democrats had "bargained away the heart of health care reform allowing conservative senators like Joe Lieberman and Ben Nelson to hold the process hostage and protect Big Insurance."
Insurers, private hospitals and some doctors are opposing the expansion of Medicare because of potential for lower payment rates.
The Mayo Clinic Health Policy Center attacked the plan. Expanding Medicare to individuals 55 to 64 years old, it said, "would ultimately hurt patients by accelerating the financial ruin of hospitals and doctors across the country."
Ken Johnson, senior vice president of the Pharmaceutical Research and Manufacturers of America, took aim at an amendment that would allow importation of cheaper medicines from Canada and elsewhere saying, "it could expose Americans to counterfeit and substandard drug products."
The Aetna insurance company came out against a feature of the compromise plan that mandates that 90 percent of premiums go to benefits for patients.
Liberal lawmakers appear to be pleased, however, that there is a framework for compromise that both they and centrists can support, enabling a united group of health care reform supporters to face off against die-hard Republican opponents.
Sen. Mary Landrieu, the conservative Louisiana Democrat who resisted the public option, said the Medicare expansion could help small business. "There are a lot of small business people who are between the ages of 55 and 64," she said. "If that were done it would provide some real relief to them."
Sen. Blanche Lincoln, D-Ark., said she approved of the national plans being administered by the government. "The Office of Personnel Management being the negotiator will help, I think, be able to bring the best product forward," she said.
On the liberal side, Sen. Bernie Sanders, I-Vt., a strong supporter of single-payer, argued that "the Medicare buy-in might be superior to the forms of public option previously under discussion."
Even Lynn Woolsey, co-chair of the House Progressive Caucus, whose members have pledged to vote against any plan without a public option, would not go so far as to say that House progressives would block a final package modeled on the Senate compromise. "Progressives are looking for affordability and competition for private insurance plans," Woolsey said, "and if they aren't satisfied, they'll have a hard time voting for the final bill."
Some say that opening Medicare to those 55 and over could, depending upon how it is done, have profound effects far beyond health care. Todd Swim, with the Mercer health benefits consulting firm, noted that "those 55 to 65 are the most expensive for employers to cover, and they pay the most if they have to buy coverage on their own. Access to medical care is one of the biggest inhibitors to retiring early, and a lot of people are going to be looking at that as an option."
Others warn that a political fight will be necessary to guarantee that a Medicare buy-in really works to benefit the people.
"My greater fear is that the ‘Medicare buy-in' can be gutted of all value," said FireDogLake's Jon Walker. He warned that Sen. Kent Conrad, D-N.D., "is pushing to decouple this Medicare buy-in from real Medicare. He wants people in this fake Medicare to pay much higher reimbursement rates and be placed in a separate risk pool. The people in fake Medicare might not even be able to use the Medicare provider network. This will make the premiums for buy-in Medicare dramatically higher."
Sen. Olympia Snowe, R-Maine, told reporters premiums would total about $7,600 annually until federal subsidies became available in 2014. That amounts to more than $600 a month, far higher than the $96.40 paid by beneficiaries 65 and older.
Photo: President Obama, with Senate Majority Leader Harry Reid, meets with congressional leaders at the White House in Washington. (AP/J. Scott Applewhite)