One of the biggest obstacles going into the Senate’s debate on a comprehensive health care reform measure was the existence of a government-run public insurance option.

That obstacle may have been lowered a bit by news that an alternative plan is on the table, whereby private insurers, and not the federal government, would assist in expanding coverage.

Under the proposed plan, according to media reports, the government would only get involved if private insurance companies do not participate in a revamped national health care plan.

Harry Reid

Following a long day of negotiations Dec. 8, Senate Majority Leader Harry Reid (D-Nev.) said he asked Sens. Chuck Schumer (D-N.Y.) and Mark Pryor (D-Ark.) “to work with some of the most moderate and most progressive members of our diverse caucus and tonight they have come to a consensus.”

Reid elaborated that the consensus “includes a public option and will help ensure the American people win in two ways: one, insurance companies will face more competition and two, the American people will have more choices.”

“I know not all 10 Senators in the room agree on every single detail of this, nor will all 60 members of my caucus,” Reid said in a statement. “But I know we all appreciate the hard work that these progressives and moderates have done to move this historic debate forward.”

The Senate majority leader said he would not disclose the details of the proposal before the Congressional Budget Office evaluated it, but said he remained “confident” in the outcome of negotiations.

Media reports indicate that the compromise includes nonprofit health plans under the oversight of the Office of Personnel Management (OPM), which runs the health plans of federal employees. The OPM would negotiate with private insurers to offer the national health benefit plan that mirrors those offered to members of Congress.

The plan would also open Medicare to Americans at a younger age, likely age 55, beginning in 2011.

The plan does, however, include a trigger where the federal government could get more involved in health care if private insurers declined to participate in the nationwide plan, possibly for the OPM to set up a public option, run nationally or by individual states.

In his initial draft of the Patient Protection and Affordable Care Act, Reid included a version of the public option run by the government, but with the ability for states to “opt out,” by passing legislation.

While seen as a way to end an impasse among members of the Senate, the public option alternative, which has yet to be presented to the full body, already has its opponents, including one of the “Team of 10” that drafted the compromise, Sen. Russ Feingold (D-Wis.).

“While I appreciate the willingness of all parties to engage in good-faith discussions, I do not support proposals that would replace the public option in the bill with a purely private approach,” Feingold said in a statement. “We need to have some competition for the insurance industry to keep rates down and save taxpayer dollars.  I will base my vote on the bill on the entirety of what is in the bill, and whether I think the bill is good for Wisconsin.”

Joining Schumer, Pryor and Feingold in drafting the compromise plan were Democratic Sens. Sherrod Brown (Ohio), Tom Carper (Del.), Tom Harkin (Iowa), Mary Landrieu (La.), Blanche Lincoln (Ark.), Ben Nelson (Neb.) and John “Jay” Rockefeller (W.Va.)