Senate Majority Leader Harry Reid (D-NV) announced at a press conference that the Senate combined health care reform bill will include a public option with an “opt-out” option for states.  Under this scenario, individual states would have the ability to opt-out of offering a government-sponsored insurance plan as part of the health insurance exchanges that would also be created under the bill.

In order to pass, Reid will need all 58 Democrats and two Independents to vote for the provision.  It has been speculated that at least two Democrats, and one Independent have not yet committed their support.

Other reports indicate that this is the first of many “test” provisions that will make it to the Senate floor for debate.  First is the above mentioned “state opt-out,” if that fails then a “state opt-in,” and next a public plan “trigger” proposal is also on the table whereby a public plan would be triggered in a state where mandated health coverage cost reduction goals are not achieved.  Reid announced that the Senate bill will now be sent to the Congressional Budget Office to receive a total cost as well as coverage estimates.  Throughout last week Senate leaders were working to combine both bills resulting from Finance and Health Education, Labor and Pensions.

IHA supports increasing health care coverage to as many citizens as possible, but maintains concerns that a public health insurance plan would reimburse hospitals at Medicare rates.  Medicare rates are generally much lower than private insurance payments, and Iowa ranks near last in Medicare reimbursements contributing to hundreds of millions of dollars in payment shortfalls each year.