Christine Stuart photo

When two key Democrats first released the 615-page US Senate bill to reform health care in this country they failed to describe what they meant by a ‘public option.’ The incomplete proposal carried a roughly $1 trillion price tag.

But U.S. Sen. Chris Dodd said Thursday in a conference call with reporters that the new language creates a “strong” public option that will cost about $611.4 billion over 10 years—not the roughly $1 trillion originally estimated.

In this letter to members of the Congressional Health, Education, Labor and Pensions Committee, Dodd and US Sen. Ted Kennedy of Massachusetts detail the government-run public option and the fees it would charge employers who do not provide coverage for their employees.

“We are on the cusp or brink of doing something here that is absolutely critical,” Dodd said Thursday. “The present situation is unsustainable. The status quo is unacceptable. The American public believes a public option is in their best interest and we intend to give them that public option.”

The revised and far less costly health care plan would be a national plan administered by the U.S. Department of Health and Human Services, which will negotiate rates and premiums. And Dodd was quick to point out that participation in the public government-run option would be voluntary.

Also any business with more than 25 employees would be subject to a fee of $750 per full-time employee and $375 per part-time employee, if it failed to offer health insurance to its employees.

“The completed bill virtually eliminates the dropping of currently covered employees from employer-sponsored health plans,” Dodd and Kennedy wrote in their letter. “In addition, our bill, combined with the work being done by our colleagues in the Finance Committee, will dramatically reduce the number of uninsured – fully 97 percent of Americans will have coverage, a major achievement.”

The public option has been endorsed by all 13 Democrats on the HELP Committee, which is one of the two committees working on the bill. The HELP Committee will have to combine its legislation with legislation from the Senate Finance Committee. Dodd said he hopes to have that work completed by the end of July, so a vote can be taken in the fall

Earlier this week U.S. Sen. Joseph Lieberman said he considers a government-run public option a stumbling block to passing a reform package to cover millions of uninsured Americans and lower health care costs—something he said he’s working hard to do along with a coalition of Republican and centrist Democratic senators.

“If we create a public option, the public is going to end up paying for it,” Lieberman said Tuesday. “That’s a cost we can’t take on.”

The government-run public option debate will need to be worked out over the coming weeks, but Dodd said Thursday that there’s still room for bipartisan agreement.

“I know the public option is a controversial item,” Dodd said. “But it’s very American to have options.”

Dodd and Lieberman will just have to agree to disagree at the moment.

Dodd said the public option, will be just one of the many options available to consumers in the health insurance market.

It will not be a subsidized plan, Dodd said. It may need some public money at the beginning, but over time it will be able to sustain itself on the premiums it collects.

Without a public option “you’re going to see health care costs, rise, and rise,” Dodd said.

While aiming for a bipartisan agreement, Dodd didn’t rule out using a Senate rule, which would allow the Democrats to push through a bill without the support of Republicans.

The budget reconciliation vote, which the Senate is allowed to use once, means a bill only has to pass with 51 votes, instead of the 60-vote supermajority normally required to avoid a filibuster.

“That would make this far more difficult to pass because instead of being a 10 year bill it would be a five-year bill,” Dodd said. “Saving costs in five years would be almost impossible. So I prefer we didn’t go the reconciliation route, but we could upon analysis to get a bill done.”