Democrats In Senate Drop Healthcare Public Option!

UPDATE: Now Harry Reid is calling the reports that the public option was dropped "not true."

Yeah right, Harry....I'm guessing you've got a new snake oil spin on the public option, right?

Remember, you can't please all of the people, all of the time. Here's the link to Reid's denial:

Reid Says It Ain't So!

(Hat Tip: FishBowl)

Here's the latest I could find from Yahoo News:
(Hat Tip: BartlebytheScrivener)

Dems agree to drop gov't-run insurance option

WASHINGTON – Democratic senators say they have a tentative deal to drop a government-run insurance option from health care legislation. No further details were immediately available.
But liberals and moderates have been discussing an alternative, including a private insurance arrangement to be supervised by the federal agency that oversees the system through which lawmakers purchase coverage. Additionally, talks centered on opening up Medicare to uninsured Americans beginning at age 55, a significant expansion of the large government health care program that currently serves the over-65 population.
Sen. Tom Harkin of Iowa told reporters he didn't like the agreement but would support it to the hilt in an attempt to pass health care legislation.
THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.
WASHINGTON (AP) — Abortion opponents failed to inject tougher restrictions into sweeping Senate health care legislation Tuesday, and Democratic leaders labored to make sure fallout from the controversy wouldn't hinder the drive to pass President Barack Obama's top domestic priority.
The 54-45 vote over abortion took place as Democrats, in daylong private talks in the Capitol, appeared ready to scuttle plans for a government-run insurance option that liberals have long sought.
A potential alternative was taking shape, several officials said, including a private insurance arrangement to be supervised by the federal agency that oversees the system through which lawmakers purchase coverage. Additionally, Medicare would be opened up to uninsured Americans beginning at age 55, a significant expansion of the large government health care program that currently serves the over-65 population.
Taken together, the day's developments underscored the complexity that confronts the administration and Majority Leader Harry Reid, D-Nev., as they seek the 60 votes needed to overcome Republican opposition and pass a bill by Christmas.
Yet another controversy quickly followed, when Sen. Byron Dorgan., D-N.D, proposed legalizing the importation of prescription drugs from Canada and several other countries as a way of holding down consumer costs. The idea enjoys widespread support but is opposed by the pharmaceutical industry, which has worked closely with the administration on health care and has spent millions of dollars on television advertisements in support of legislation.
The Food and Drug Administration issued a letter saying it would be "logistically challenging" to assure the safety of imported drugs, raising concerns without stating outright opposition.
Reid — the chief architect of the health care bill as well as an abortion opponent — played a prominent role in the debate over attempts by conservatives to toughen restrictions in the Senate measure. "No one should use the health care bill to expand or restrict abortion," he said, arguing that abortion foes were attempting to do just that. "And no one should use the issue of abortion to rob millions of the opportunity to get good health care."
The current legislation would ban the use of federal funds to pay for abortion services under insurance plans expected to be offered in a new health care system, except in cases of rape, incest or when the life of the mother was in jeopardy.
Individuals who receive federal subsidies to purchase insurance under the plans would be permitted to use personal funds to pay for abortion services — the point on which the two sides in the dispute part company.
"Segregation of funds is an accounting gimmick," said Sen. Ben Nelson, D-Neb., the chief Democratic supporter of tightened restrictions. "The reality is federal funds would help buy coverage that includes abortion."
Abortion rights supporters, Senate Democratic women most prominently, countered heatedly.
Sen. Dianne Feinstein, D-Calif., said abortion opponents were driven by ideology, and Sen. Jeanne Shaheen, D-N.H., called the proposed changes "a very far-reaching intrusion into the lives of women."
The amendment that Nelson, Sen. Robert Casey, D-Pa, Sen. Orrin Hatch, R-Utah, and numerous Republicans proposed would also have barred insurance plans from covering abortions except in the three categories if any of their policyholders received federal subsidies. It also would have required insurance companies that offer no-abortion plans to make available a policy that offers such services.
In all, 50 Democrats, two Republicans and two independents voted to kill the abortion proposal. Thirty-eight Republicans and seven Democrats favored it.
It was not clear whether the vote would mark the end of efforts by abortion opponents to change the health care bill before any final compromise talks with the House.
Nor was it clear how Nelson would respond to the defeat. He told reporters the result "makes it harder to be supportive" of the final legislation. But he wouldn't flatly rule out his support, adding, "We'll have to see if they can make it easier."
Sen. Dick Durbin of Illinois, the second-ranking Democrat, told reporters, "Now we hope that we can work with him to get a provision in this bill that he can accept."
Barring a change of heart by one of the Senate's Republicans, Democrats cannot afford any defections if they are to pass their bill. Nelson has also been one of the most outspoken Democrats in opposition to a government insurance option and was involved in the closed-door talks taking place in recent days.
The Nebraska Democrat already has won a major concession from Reid, who agreed earlier that the legislation would allow the insurance industry to retain its exemption from antitrust laws. Several Democrats favor ending the exemption — the Houses-passed version of the bill does so — and would presumably be emboldened to try to remove it if Nelson decides to oppose the bill.
Abandonment of a government-run insurance option would mark a significant defeat for Senate liberals, who have long demanded its inclusion in the legislation as a way to force private insurers to hold down costs. It also would set up a final struggle with the House, which passed a health care bill earlier this year that gives millions of consumers the option of buying government-run coverage.
In place of the public insurance option that Reid inserted into the bill earlier, Democrats are considering a plan for the Office of Personnel Management to oversee private insurance, much as it does for federal employees and lawmakers.
Details were sketchy, but it appeared to win support from moderates as well as a positive response from Sen. Joe Lieberman, the Connecticut independent who has vowed to oppose any government-run health care plan.
There were few details available of the proposed Medicare expansion, which would open the program to the uninsured beginning at age 55.
An attempt by liberals to expand Medicaid drew objections from Sen. Mary Landrieu, D-La., and other Democratic moderates, and seemed unlikely to survive. Sen. Olympia Snowe, R-Maine, whom Democrats are courting to support the bill, also criticized the idea.
In general, the legislation is designed to expand insurance coverage to millions who lack it, while banning insurance industry practices such as denying coverage on the basis of pre-existing medical conditions and reining in the relentless growth of medical costs in general.
Most Americans would be required to carry insurance for the first time, and face penalties if they refused. At the same time, the bill includes hundreds of billions of dollars in subsidies to help defray the cost of coverage for lower and middle income families.