Reid Backs Health Public Option With State Opt-Out

Oct. 26 (Bloomberg) -- Senate Democratic Leader Harry Reid said he will ask the U.S. Senate to vote for a government-run health-insurance program that would allow states to opt out. Reid said the so-called public option with the opt-out provision is the “fairest way to go†The government-run plan, which would compete with private insurers, is among the most divisive issues in the health legislation, which is designed to cover millions of the uninsured and curb rising medical costs. The option has drawn opposition from every Senate Republican and some Democrats, many of whom say it will undermine the private market. “We clearly will have the support of my caucus to move to this bill and start legislating,” Reid, a Nevada Democrat, said at a Washington press conference today. Insurers’ stocks fell 2.5 percent for the day, as measured by the Standard & Poor’s 500 Managed Health Care Index of six companies. Humana Inc. of Louisville, Kentucky, and Cigna Corp. of Philadelphia led the declines with 3.5 percent drops. A public insurance program “would underpay doctors and hospitals rather than driving real reforms,” according to a statement released by the America’s Health Insurance Plans trade group. “It’s time we focus instead on broad-based reforms.” Losing Snowe?