From the August 2009 issue of Ceridian Connection.

While support for creating a health insurance exchange remains unanimous, sharp divisions have emerged over whether a Medicare-like government health plan should be available within the exchange. President Obama and many members of Congress favor including the so-called "public option" within the exchange to ensure competition among private health insurance companies.

Opponents complain that a government plan option will not just referee competition among private health plans but actually be one of the players on a very unlevel playing field. They say that private plans will be unable to compete against a tax-subsidized federal agency with the power to undercut market premiums and that, ultimately, only the government plan will survive.

The debate over the public option reflects a strong ideological clash between liberals and conservatives over the role of government in the U.S. healthcare system. Some lawmakers distrust private health insurance companies and favor a strong government role in the new system. Similarly, other lawmakers, believing that most Americans are happy with their present coverage, question whether the federal government should expand its role in healthcare.

Look for political moderates in both the House and the Senate to engineer a compromise on this issue and possibly authorize but not actually implement the public plan option. To be sure, it remains one of the most contentious issues -- but in the end is not likely to stand in the way of final agreement.

Four consensus issues	SPACE	Four roadblocks to reform
Insurance market reform	SPACE	Financing healthcare reform
Creation of a health insurance exchange	SPACE	Saving for out-of-pocket health costs: FSAs in the spotlight
Subsidies for lower income households	SPACE	Public plan option in the health insurance exchange
Support for wellness and prevention	SPACE	Employer mandate