Although Senate Democrats seem to be moving toward a compromise on health care reform that would allow individual states to opt-out of a national public option, U.S. Rep. Bruce Braley is adamant that such a provision would defeat the overall purpose of health care reform.

“One of the problems is that in many states the lack of competition is what gave rise to the need for a public option,” Braley said. “People who oppose the public option are ignoring the reality that in many states there is no competition. So, if you give states who have a strong political influence from one or two major health insurance companies, that convince those states to opt-out of the public option, it leaves the consumers in those states without a meaningful choice. That goes against the whole purpose of creating a public option.”

The compromise, which is under consideration by Senate Democrats as a way of mitigating a Republican filibuster, would provide a robust national public option. All states would initially be included in the public option, but would have the opportunity to waive it in favor of a private-only health insurance system.

“Keep in mind that what we come up with in our merged bill may not be what finally emerges either out of the Senate or out of conference,” said U.S. Sen. Tom Harkin, and the reiterated his promise that the final bill that goes to the White House will have “a strong public option.”

Harkin added that he is one of the Democratic Senators who has floated the idea of allowing state’s to opt-out of a national public option.

“I’ve talked to various people about that,” he said. “It might be a possibility.”

Both Houses — and both political parties — are now considering compromises in their chamber while keeping a firm eye on how those changes will ultimately impact the final bill that goes to the White House. For instance, if the public option within the House version of the reform bill is weakened, and the Senate fails to include a public option in its merged effort, the prospects of having any meaningful public option in the final bill are diminished. In that respect, it is important for those in the Senate who want the final bill to have a public option to have one included in their bill, even if that means watering it down to avoid filibuster and to entice affirmative votes from more moderate members.

Harkin, as chairman of the Health, Education, Labor and Pensions Committee, will be instrumental in negotiating with Sen. Max Baucus (D-MT) and Sen. Harry Reid (D-NV) on what type of bill initially appears on the floor of the Senate. Harkin also made clear this morning that the official point person for the HELP Committee during the negotiations will be Sen. Chris Dodd (D-CT), who led the health care reform process while Sen. Edward Kennedy was incapacitated with illness. Both Dodd and Harkin, however, are in agreement that the bill placed on the floor of the Senate must initially include a strong public option — something that Baucus did not include in the Senate Finance Committee’s bill, and something that Reid has no yet signaled will happen.

Members of the House are working to merge three committee reform bills, all of which include a public option.

“It could be stripped from the bill in the House if an amendment is approved that would remove the public option,” Braley said. “I don’t see that happening in the House bill. I’m confident that the House bill will have a robust public option. We had a lengthy caucus meeting yesterday, trying to find additional savings that were tied to the public option and how the provider network would be constructed.”

A key point of contention for Braley, as well as for elected officials from other less densely populated states, is that any public option also level the playing field for Medicaid/Medicare reimbursement rates.

“The challenge in doing this is that there is a lot more cost savings if you go to a public option that is based on a reimbursement rate of Medicare plus five percent, but in states like Iowa where Medicare has long been underpayed to physician providers, that is much less of an incentive,” Braley said.

“If you have public option, and you can’t recruit providers to participate, then you don’t have a meaningful public option no matter how much savings it could achieve. Part of the debate we are having in the caucus right now is how you strike a balance between what we have in the bill, which is a negotiated rate right now between Medicare and 50 percent of the private pay rate, or something like Medicare plus five [percent]. We won’t know how that plays out in the House until we see the final language of the bill.”