Public Insurance Advocates Don't Want Compromise on Public Option

He urged the president to forget about convincing Republicans to support a bipartisan effort. The public plan option "can pass with a majority vote," Reich said.

In recent days, California Sen. Dianne Feinstein voiced her doubts about a public plan, saying yesterday President Barack Obama may not have the votes for such an ambitious overhaul of the system.

"There's a lot of concern in the Democratic Caucus," Feinstein said on CNN. "If you change the Medicaid rate (to pay for the public plan) it has an impact on California of between $1 billion and $5 billion a year. Now how could I support that? Because it would take down the state."

Just covering the 6.6 million Californians who lack health coverage and are below the poverty line "becomes a huge, huge problem" Feinstein said.

But Reich and Hacker, who yesterday took their views before the House Education and Labor Committee, said Congress and the White House should do what recent polls say America wants, which is to give private health insurance companies some much needed competition.

Reich said the idea getting the most traction this week (smaller private cooperatives that would buy health insurance for its members) sounds like a good idea, but "doesn't have the scale, the authority, or the scope necessary to negotiate better rates for its enrollees."

Smaller cooperatives also would not be able to generate the badly needed outcome data that consumers need to learn what providers and healthcare strategies get the best results.

Hacker and Reich also said that other suggestions, such as states operating their own decentralized cooperatives or public plans, falls apart for the same reason.

Health insurers have said they would accept all members regardless of pre-existing conditions and not charge women more for individual insurance in hopes of derailing public insurance, but Reich said a public plan is a better option.

"Without a public option from the start, private insurers won't have an incentive for a system-wide model to reach these targets," he said.

"It is critically important for the president to make crystal clear to Democrats and Republicans alike that he will not sign a bill that does not have a real public option in it," he added.