The American Federation of State, County and Municipal Employees and the Service Employees International Union have pulled out of a broad-based coalition seeking consensus on overhauling the U.S. health care system, the New York Times reports. The Health Reform Dialogue coalition, led by American Hospital Association President Richard Umbdenstock, includes representatives of doctors and nurses, patients and consumers, insurers, pharmaceutical firms, and businesses of all sizes. The group by the end of the month plans to issue recommendations for controlling health care costs and expanding coverage to all U.S. residents. However, according to the New York Times, the withdrawal of the two unions "shows the seeds of discord behind the optimistic talk" last week at the White House health care summit.

Members of the coalition said they have not been able to agree on proposals for a new public health insurance option or a requirement that all employers contribute to the cost of coverage for all workers -- "two of the knottiest issues in the health care debate," the New York Times reports. SEIU and AFSCME support both the public option and the employer mandate. Lori Lodes, a spokesperson for SEIU, said, "We support the public insurance option. We strongly support the health care proposal President Obama laid out in the campaign." In petitions sent to lawmakers, the union has written that a health care overhaul must include "the choice of a public plan, so we're not left at the mercy of the same private insurance companies that have gotten us into this mess." AFSCME Director of Collective Bargaining and Health Care Policy Steven Kreisberg said, "I can confirm that we did drop out of the dialogue last week. We are no longer part of the group." He said the union withdrew for "various reasons," but declined to elaborate.

A member of the coalition, speaking on terms of anonymity, said the group's final report likely "will be a consensus product reflecting the lowest common denominator." Families USA Executive Director Ron Pollack said that the unions "wanted a more robust, expansive agreement." Peter Adler -- president of the Keystone Center, which is mediating the coalition's discussions -- said, "SEIU and AFSCME have left the table," but "[w]e are trying to keep the lines of communication open" (Pear, New York Times, 3/7).

Insurers
Creating a public health insurance option, which is supported by Obama and Democratic congressional leaders, could be a "dealbreaker" for some Republicans and insurance companies whose support would ease the way for a health care overhaul, the AP/Miami Herald reports. According to the Commonwealth Fund, a public coverage program similar to Medicare would reduce projected health care costs by about $2 trillion over 11 years, and reduce premiums by about 20% on average. Within about a decade, 105 million people would be enrolled in the public plan, and about 107 million would have private insurance, according to the Commonwealth Fund.

However, insurers are concerned that competition from a public option could "drive them out of business," and Republicans worry that "it would lead to a government takeover of health care," the AP/Herald reports. Rep. Roy Blunt (R-Wyo.) in the Republican weekly radio address on Saturday said, "I'm concerned that if the government steps in, it will eventually push out the private health care plans millions of Americans enjoy today," adding that a public option "could cause your employer to simply stop offering coverage, hoping the government will pick up the slack."

In response to a question from Sen. Chuck Grassley (R-Iowa) about the inclusion of a public plan, Obama at the health care summit last week said, "The thinking on the public option has been that it gives consumers more choices and it helps ... keep the private sector honest, because there's some competition out there." He added, "I recognize, though, the fear that if a public option is run through Washington, and there are incentives to try to tamp down costs, ... that private insurance plans might end up feeling overwhelmed" (Alonso-Zaldivar, AP/Miami Herald, 3/7).

Although "hard questions lurk beneath the cheery surface of consensus," America's Health Insurance Plans President and CEO Karen Ignagni at the summit pledged the cooperation of its members in efforts to reduce health costs and expand coverage, the Philadelphia Inquirer reports. She said, "We understand we have to earn a seat at the table. You have our commitment to play, to contribute and to help pass health care reform this year" (Fitzgerald, Philadelphia Inquirer, 3/8).

Additional Developments

• Advertisements: As the debate over health care reform "cranks up in the coming months," advocacy groups will spend "millions of advertising dollars waging a public relations war of words" to win the influence of the public and lawmakers, the Washington Times reports. This debate is expected to be "significantly more intense and expensive" than the effort accompanying the Clinton administration's attempt to create a national health care system in the 1990s, the Washington Times reports. New America Foundation Director for Health Policy Len Nichols said, "The (liberal) groups will be outspent again, but it won't be as bad" as in the 1990s. He added that the side who most benefits from the debate will not necessarily be the one that spends the most on advertising. He said, "I don't think it's really about spending -- it's about which arguments are going to resonate with the American people. That's why they pay those (public relations) firms beaucoup money" (Lengell, Washington Times, 3/8).
  
  
• Obama: Obama is "using skills honed during his presidential campaign and lessons learned from past failures to try to overhaul the health care system," according to the AP/Boston Globe. Whereas Clinton excluded both Congress and interest groups from his process of developing a health care overhaul plan, Obama "has chosen to be flexible," outlining basic proposals and "leaving the heavy lifting to Congress," according to the AP/Globe. Obama also has asked supporters and critics of his plan to offer ideas and advice, and has indicated that he would be willing to compromise. In addition, he likely will travel across the country to "take the proposal directly to the people, using his rhetorical skills and charisma to keep people on the side of change -- and pressure lawmakers to get it done," the AP/Globe reports (Sidoti, AP/Boston Globe, 3/9). In related news, Rep. John Conyers (D-Mich.) on Saturday said Obama will not seek a single-payer health coverage system because he does not have the resources to dedicate to such an effort, and would implement a system that incorporates both public and private coverage "if he's lucky." Conyers spoke at Thomas Jefferson University. He was in Philadelphia to gain support for his bill (HR 676), which would create a single-payer health care system (Vitez, Philadelphia Inquirer, 3/8).
  
  
• Tauzin: Former Rep. Billy Tauzin (R-La.), president of the Pharmaceutical Research and Manufacturers of America, in an interview with C-SPAN that aired Sunday, said that business and pharmaceutical groups are in favor of overhauling the health care system and that Republican lawmakers must take part in this process. Tauzin said, "The very support base of the Republican party is asking them to be part of the solution. My strong advice to them is as you build your own plans, ... recognize that a lot of your own constituencies, traditional constituencies, really want to see this thing worked out, and don't want battle lines drawn and mine fields set up so it can't happen this year." Tauzin added, "I've had conversations with Republicans in both the House and the Senate side who tell me they believe it's [going to] happen. ... They're more interested now in making sure that some of their principles and some of their concerns are addressed properly" (Armstrong, CQ Today, 3/6).

Editorial
Obama "has shown both courage and sound judgment [by] pressing for quick action on comprehensive health care reform, even in the midst of the country's deep economic crisis," a New York Times editorial states. The editorial credits Obama for proposing $634 billion over 10 years as a down payment on how to pay for expanded health care and for suggesting ways to reduce increasing health spending as part of a first step in health reform. However, the editorial says "his proposals, for all of their ambition, do not fully answer two central questions: how to cover tens of millions of uninsured Americans, and how to reform the health care system to reduce costs and improve the quality of care." According to the editorial, Obama "has obviously decided that it is best to let Congress work out the compromises and decide how to allocate the pain." The editorial concludes, "We do not challenge Mr. Obama's political instincts. We simply note that someone will need to make the hard choices if health care reform and universal coverage are to succeed" (New York Times, 3/8).

Opinion Pieces

• Michael Hiltzik, Los Angeles Times: AHIP in December 2009 "revealed that it had experienced an epiphany and decided for the first time to support the principle of universal health care," but the insurance industry group's commitment is only "skin deep," as the group has not changed its position "at all," columnist Hiltzik writes. According to Hiltzik, the insurers still want "permission to offer stripped-down, low-benefit policies freed from pesky state regulations limiting their premiums," and will "accept a government mandate to take on all consumers, as long as all Americans are required by law to buy coverage." The piece continues that while AHIP's Ignagni can "afford to be graceful" because "no specific reform plan is yet on the table," the industry will "deploy in force to kill anything that threatens its profitability and freedom of movement." The "industry talks a good game about marching for reform side by side" with all stakeholders in the debate, but "[v]eterans of earlier health care battles justly wonder if the industry is merely trying to get in front of the parade, the better to lead it into a dead end" (Hiltzik, Los Angeles Times, 3/9).
  
  
• Tom Baker/Peter Siegelman, New York Times: Baker, an author and professor at the University of Pennsylvania Law School, and Siegelman, a professor at the University of Connecticut School of Law, suggest that one way to provide health insurance for people ages 19 to 29 is a "tontine," under which insurance companies would give a bonus to those whose health care costs, excluding preventive care, are below a certain level over five years. Baker and Siegelman write, "The program must be designed so that participants don't forgo truly needed care in order to stay eligible for the bonus." They add, "There are of course many reasons why everyone should buy insurance," but "those reasons don't appeal to the young invincibles, with their exaggerated optimism about their health." According to Baker and Siegelman, "The beauty of the tontine feature is that it frames the health insurance purchase as a smart investment rather than a way to spend money for something the customer doesn't think he needs" (Baker/Siegelman, New York Times, 3/9).
  
  
• Adrienne Washington, Washington Times: "While the breathless ... spin on both sides of the thorny health care issue will be whipped up in the coming days and weeks, Americans will do well to pay close attention to which lobbying campaigns are being fund[ed] by whom and for what agenda," Washington Times columnist Washington writes. She concludes, "In the final analysis, ask yourself whether what's being promoted by ads and advocates best helps you and your family gain equitable, quality, affordable health care coverage, or lines the pockets of health care industry executives, lobbyists and the politicians they support" (Washington, Washington Times, 3/8).

Broadcast Coverage
CNN's "American Morning" on Friday reported on the summit. The segment includes comments from Karen Tumulty, a senior writer with Time Magazine and a summit attendee; Christina Johns, an emergency department specialist at Children's National Medical Center in Washington, D.C.; and Paul Keckley, executive director of the Deloitte Center for Health Solutions (Roberts, "American Morning," CNN, 3/6). A transcript of the segment is available online. In addition, CNN's "American Morning" on Friday reported on the summit and Obama's plans to enact health care reform by the end of the year (Malveaux, "American Morning," CNN, 3/6). A transcript of the segment is available online.

MSNBC's "Hardball with Chris Matthews" on Friday included a panel discussion about whether Obama will be able to reform the U.S. health care system, which Clinton was unable to do (Matthews, "Hardball with Chris Matthews," MSNBC, 3/6).

PBS' "Washington Week with Gwen Ifill" on Friday reported on health care reform (Ifill, "Washington Week with Gwen Ifill," PBS, 3/6).