The cover of a booklet provided at an informational meeting on the Medicare drug prescription program in Sun City, Ariz.
The cover of a booklet provided at an informational meeting on the Medicare drug prescription program in Sun City, Ariz. - 
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Kai Ryssdal: It looks like the health-care overhaul has cleared another hurdle. That only leaves about a zillion or so hurdles to go. This one is a big one, though. Senate Democrats have tentatively agreed to scrap the idea of a government-run insurance plan -- aka the public option. In its place the uninsured could buy coverage from a network of non-profits. And people as young as 55 would be allowed to buy into Medicare. Marketplace's Nancy Marshall Genzer reports.

NANCY MARSHALL GENZER: The Senate compromise relies on the ultimate public option -- Medicare. The government-run health care program for the elderly. Uninsured people aged 55-64 could enroll in Medicare, paying their own premiums. This would be especially appealing to people considering early retirement, and a lifeline for those losing their jobs and health insurance.

Jonathan Gruber teaches economics at MIT.

JONATHAN GRUBER: In some sense it can kind of be like a trial of a public option. You can say, well look, let's try a true public option for a small slice of people and see what happens.

One irony is that senators seem to be agreeing that it's better to add several million people to an already huge, overburdened government- insurance plan, than to accept anything with the name "public option."

For people who choose Medicare, this could be a good deal, if they can find a doctor or hospital. Medicare pays a set rate. Providers say it's not enough to cover their costs.

Rick Polleck is executive vice president of the American Hospital Association.

RICK POLLECK: On average, they would get paid 91 percent of the cost of delivering the service. And that's a pretty big gap.

Is that gap big enough to turn hospitals and doctors against the health-care overhaul?

Doctor Lori Heim is president of the American Academy of Family Physicians. She's hedging her bets.

LORI HEIM: We will have to evaluate what are the details of it. Does it provide for a stable funding stream?

Heim says she does support the House health-care bill. It does not include the Medicare compromise.

In Washington, I'm Nancy Marshall Genzer for Marketplace.