Obama Struggles to Strike a Health Care Deal Palatable to All Sides

For President Obama, striking a deal that satisfies all the parties involved in the health care debate may turn out to be harder than overhauling the health care system itself.

The president finds himself stuck between a rock and a hard place, going round and round in a dizzying cycle of give and take that doesn't seem to be advancing his top domestic priority. As soon as he makes a concession to one group, he loses support from another.

And throughout the process, the stakes remain high: About 50 million Americans currently have no health insurance. The government provides coverage for the poor, the elderly, military veterans and many children, but most Americans rely on private insurance, usually obtained through their employers.

But not all employers provide benefits, and not everyone can afford to buy them. And with unemployment high, many Americans are losing their benefits when they lose their jobs.

Three House committees and one Senate committee have voted out health care reform bills. A group of lawmakers on a fifth panel, the Senate Finance Committee, continue to negotiate on a version of the legislation.

Here are all the different groups that have a stake in the debate, what they're after and what they're willing to give.

Liberals -- They insist that a government-run health insurance plan, or "public option," that will compete with private insurers is essential to health care reform. The Obama administration initially championed this plan, but it is now backing away to win support from conservative Democrats and Republicans, who fiercely oppose it. Administration officials say they can live with nonprofit cooperatives as a substitute for a government-run option. But liberals, including several House Democrats, are refusing to accept a co-op alternative because they say it will not have the bargaining power to negotiate prices and keep private insurers honest.

This week, more than 50 House Democrats issued a letter saying, "Any bill that does not  provide, at a minimum, for a public option with reimbursement rates based on Medicare rates -- not negotiated rates- - is unacceptable."

Blue Dogs -- These fiscally conservative Democrats are concerned about the costs of overhauling the health care system and the potential harm it could have on small businesses. They don't want sweeping changes to health care to add to the federal deficit over 10 years. Many of them also are not crazy about a "public option," but some are willing to include it as long as it is not mandated.

A group of key Blue Dogs on the House Energy and Commerce Committee negotiated a deal to exempt businesses with payrolls of $500,000 or below from a requirement to provide insurance to employees or pay a penalty. And they required payment rates to doctors and other medical providers to be negotiated with the secretary of Health and Human Services, instead of tied to Medicare rates.

Gang of Six -- This group of bipartisan lawmakers on the Senate Finance Committee is trying to forge a consensus deal that will appease both political parties and pass a divided Senate. The six, led by the committee's Democratic chairman, Max Baucus, include Democratic Sens. Kent Conrad and Jeff Bingaman and Republican Sens. Charles Grassley, Olympia Snowe and Mike Enzi. Majority Leader Harry Reid has given Baucus a Sept. 15 deadline for an agreement.

The group is  looking at creating nonprofit cooperatives that would lack Medicare's power to dictate payment levels and tell providers to take it or leave it. Instead, the co-ops would have to negotiate payment rates with hospitals, doctors and drug makers -- just like private insurance plans do.

Conservatives -- All of them are opposed to a "public option," saying it will lead to a government takeover of health care because private insurers will be unable to compete. The reason they don't want a government-run health care system is because they believe it will lead to rationing of care.

Former Alaska Gov. Sarah Palin fanned the flames by popularizing the term "death panels" to suggest that Obama's plan will allow government bureaucrats to make end-of-life decisions. In fact, the House health care bill requires only that Medicare pay for voluntary end-of-life counseling sessions. But Sen. Chuck Grassley said the provision was stripped from the Senate Finance Committee's version because it was open to misinterpretation.

Some conservatives also say they won't support cooperatives. The Senate's second-ranking Republican, Jon Kyl of Arizona, dismissed co-ops as a "Trojan horse" leading to government control of health care. Some Democrats believe conservatives have made a strategic decision to oppose any type of health care reform plan for political gain. If Obama is unable to pass health care reform, the argument goes, then Republicans can use that failure to win seats in next year's midterm elections.

Health care industry leaders: They want health care reform, because if the government requires everyone to get coverage, it could provide them a jackpot -- a steady stream of customers subsidized by taxpayers.

Pharmaceutical industry leaders, in particular, have agreed to reduce costs for the health care system by $80 billion over 10 years. In return, they want the government to stop negotiating lower prices for prescription drugs used in Medicare and other programs.

The Associated Press contributed to this report.