The loudest fight in the health-reform debate so far has been over whether to create a government-backed health plan to compete against private insurers. One option that’s emerging in the search for a compromise: Give health insurers a few years to cut costs and increase access, and leave a government-backed health plan as a fallback option that would be created only if private insurers don’t measure up. “Fallback is on the table,” Sen. Max Baucus (pictured) said again today at a Kaiser Family Foundation briefing today, Dow Jones Newswires reports . A similar mechanism was included in the legislation that created Medicare Part D prescription-drug coverage, but a public operation was never created because private plans were able to meet the legislation’s goals. Earlier this week, Sen. Olympia Snowe, a Republican who has broken with her party to vote

with the Dems on some key issues, said a bipartisan group of Senators on the Finance Committee (chaired by Baucus) has been looking at the fallback option as one possibility, Bloomberg News reported . Baucus also said earlier this week that the fallback plan was an option. That might be enough to get the votes of a few Republicans, but it won’t be enough for others in the party. A group of House and Senate Republicans yesterday introduced a health plan , and wrote that a government-backed insurance program would have “the compassion of the IRS, the efficiency of the post office, and the incompetence of Katrina” assistance efforts. As today’s WSJ notes , the Republican plan has little chance of passage. Photo: Associated Press

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Health-Reform Option: Government Health Plan as ‘Fallback’