Reform options may be hard to find

A harsh reality is sinking in among Democrats -- that a Republican victory by Scott Brown Tuesday could spell the end of health reform because there is no good option to rescue the plan from this latest brush with political death. Photo: AP

Ever since health care reform flamed out in the 1990s, Democrats thought lots of things might derail their longtime dream this time around. Losing a Senate seat in liberal Massachusetts was not on the list.

But that is the harsh reality sinking in among Democrats — that a Republican victory Tuesday could spell the end of health reform because there is no good option to rescue the plan from this latest brush with political death.

Publicly, the White House and top Democrats held firm to their stance that health care reform will pass this year. And Speaker Nancy Pelosi (D-Calif.) said Monday that Democrats will need to figure out a way to proceed if Republican Scott Brown wins, “but that doesn’t mean we won’t have a health care bill.”

“Let’s remove all doubt that we will have health care one way or another,” Pelosi told reporters in San Francisco.

But privately, Democrats are getting cold feet about pushing ahead full bore on health care. Moderate Democrats who have long been skeptical of the administration’s focus on the issue could begin to peel away in the face of a convincing loss for Democrat Martha Coakley, dealing a fatal blow to legislation that had no room for error in either chamber.

Democrats have options to salvage reform following a Brown victory, but all have serious deficiencies.

One idea that looked promising a week ago — passing a bill through the House and Senate before Brown was seated — has dropped down the list of alternatives, as Democrats fear it would look like a partisan power play that ignored the will of Massachusetts voters.

The White House-favored option is to ask the House to adopt the Senate bill, with a promise to make additional changes later through the budget reconciliation process. But House Democratic liberals, as well as some conservatives, don’t like key parts of the Senate bill and don’t want to make it their own.

Ron Pollack, a longtime health care insider and executive director of Families USA, has floated a variation on this theme with the administration and congressional aides: a two-step process that would reassure House members their wishes would be met in the bill.

Under Pollack’s proposal, the House would take up the Senate bill only after the White House and congressional leaders struck a deal on key issues, such as taxes and the subsidies to purchase insurance. They would incorporate those changes into a separate budget reconciliation bill.

The House would pass both the Senate bill and the reconciliation bill, possibly on the same day. The Senate would then take up the reconciliation bill, which would require only 51 votes for passage.

“It is eminently doable — and quickly,” Pollack said Monday. “It is the combination of two things that wouldn’t work separately but, when done in tandem, make a lot of sense.”

This approach, however, would prevent any fixes that did not have a direct impact on the federal budget, such as changes to language on abortion and immigration and, possibly, even the insurance exchanges. The exchange question could be particularly problematic for House Democrats who have sacrificed the public option in return for the national insurance exchanges under the House bill.

“Progressives and conservatives in the caucus won’t go for it,” one aide predicted Monday. But they may not have a choice. Another aide acknowledged a Brown win would force party leaders to recalibrate and said that Obama and Pelosi would have to convince a skeptical rank and file that this was the only course of action.

Democrats also could reopen negotiations with Sen. Olympia Snowe (R-Maine), who supported the Senate Finance Committee bill but has opposed key elements of the latest Senate bill, such as expanding the Medicare payroll tax. Any product of those talks very likely would alienate progressive Democrats.

If they decide to push forward on any front, Obama and congressional leaders will need to argue again, as they have all year, that failure to pass a bill is more perilous than passing a bill.

Liberal House Democrats have vigorously opposed pillars of the Senate bill. Last week, the White House cut a deal with organized labor to soften the impact of a Senate tax on high-end health care plans, in large part to quell unrest among Democrats in the House. Congressional negotiators are expected to announce additional compromises as early as this week, after sending large parts of the bill to the Congressional Budget Office for review.

The prospect of a Coakley loss threatens to upend those internecine negotiations, angering House Democrats who have been on the short end of just about every development in the health care fight. White House press secretary Robert Gibbs, along with multiple Senate and House offices contacted Monday, declined to comment on the way forward.

“We’re focused on two things: ironing out the differences in the bills, which you know the president has spent a lot of time working on over the past few days; and we think Martha Coakley is going to win this race,” Gibbs said.

Sen. Robert Menendez (D-N.J.) predicted a Coakley win but said Monday that a loss in Massachusetts wouldn’t end the Democratic push for health care.

“I’m sure there are other vehicles if the options are different and we don’t have 60 votes for some reason; I’m sure there are other vehicles that could be used to achieve the health care reform we want,” Menendez told POLITICO.

The debate could be moot for any number of reasons by 8 p.m. Tuesday. Coakley could pull out what would now be viewed as an upset, winning the seat after most political pundits declared her campaign dead. But a double-digit Republican win, which a Suffolk University pollster predicted Monday on MSNBC, could drastically alter the will among Democrats to push ahead with health reform.

Whatever fallback plan the Democrats come up with, it may be important for them to show that they have learned something from voters in Massachusetts. Simply finding a way around the 60-vote hurdle in the Senate may not be enough.

A Republican close to the Brown campaign told POLITICO that this is not just about health care but about a sense among voters that “they’re just not listening to us.” This helps explain the title of a Republican press release Monday on health care: “Plan B-ecause We Don’t Care What You Think.”

“This is the unanticipated glitch,” said Jim Kessler, a former longtime Senate aide who is vice president of policy at Third Way, a centrist Democratic think tank. “You have a combination of a bad candidate for the Democrats and a very good candidate for the Republicans, a low-turnout election and, essentially, a sour mood in the country and a candidate who was caught unawares. You would never expect this to happen in Massachusetts.”

Manu Raju and David Rogers contributed to this report.