Reporting on Health and Human Services Secretary Kathleen Sebelius' May 6 testimony before the House Ways & Means Committee, Fox News chief political correspondent Carl Cameron purported to report the debate over the public plan option, a component of health care reform supported by President Obama. But while Cameron provided Republicans' criticism of the public plan option, he did not note arguments in favor of the proposal -- including the argument that Sebelius made during the hearing -- that directly address those criticisms.

During the May 6 edition of Fox News' Special Report, Cameron aired a clip of Sebelius stating that reform should “includ[e] a choice between a public and private plan option.” He went on to report Republicans' criticism of the plan, saying “Republicans warn that if Uncle Sam regulates and provides health insurance, the private sector will face a crushing disadvantage,” and pointed to two Democratic senators who do not support it. He then aired a clip of Rep. Paul Ryan (R-WI) criticizing the public option during the hearing: “The way I see it it's kind of like my daughter's lemonade stand competing against McDonald's. It's having the referee, the government, also be a player in the same game, and actuarially speaking, it's almost impossible to make that a fair game.”

However, Cameron did not note the arguments of public plan supporters -- including Sebelius -- which address concerns that a public plan would enjoy an unfair competitive advantage over private plans. Indeed, Sebelius spoke to that point directly during the hearing, stating that the public plan “can be done as a level playing field. It's about the rules that are established in the beginning.” She continued, explaining how a public plan option should be structured and why it is a necessary component of reform:

SEBELIUS: And as I said, the private insurers currently have in fact a -- I would say -- a tilted playing field in way too many areas where cherry-picking on the market is a strategy to make a profit, so that the ability to underwrite individuals' medical conditions to either make insurance unaffordable or unavailable is a current private-market strategy. I think that that measure doesn't work well in a health insurance exchange any more than a measure which would give government huge advantages and huge subsidies doesn't work well. So I think if the rules are the same so individuals who have lower income, who are not insured, have a subsidy benefit as they come into the health exchange and can choose between a public and private plan option with the same kind of rules, I think it can work as a very important competitive situation where it will help drive -- where people will be competing, public and private will be competing, not on underlying price or on unfair government subsidies, but really on practice and protocol, on lowering overhead costs, on lowering administrative costs and driving benefits to their incoming enrollees.

Additionally, on May 4 Sen. Chuck Schumer (D-NY) reportedly released principles for a public plan option requested by Senate Finance Committee chairman Max Baucus (D-MT) -- whose committee is currently producing a draft health care reform bill -- that are intended to create a level playing field on which the public and private plans could compete. According to a May 5 New York Times report, Schumer said that the " 'public plan ... must be subject to the same regulations and requirements as all other plans' in the insurance market." The Times reported that the principles he released include [emphasis added]:

¶The public plan must be self-sustaining. It should pay claims with money raised from premiums and co-payments. It should not receive tax revenue or appropriations from the government.

¶The public plan should pay doctors and hospitals more than what Medicare pays. Medicare rates, set by law and regulation, are often lower than what private insurers pay.

¶The government should not compel doctors and hospitals to participate in a public plan just because they participate in Medicare.

¶To prevent the government from serving as both “player and umpire,” the officials who manage a public plan should be different from those who regulate the insurance market.

Indeed, the fourth principle directly addresses Ryan's concern, which Cameron aired, that the “referee, the government, [would] also be a player in the same game,” which would make it “almost impossible to make that a fair game.”

From the May 6 edition of Fox News' Special Report with Bret Baier:

[begin video clip]

CAMERON: It was Kathleen Sebelius' first appearance before Congress as the Obama administration's newly minted Health and Human Services secretary.

SEBELIUS: Health care reform cannot wait and will not wait another year.

CAMERON: Committee chairman Charlie Rangel, who supports reform, began with a warning.

RANGEL: There are really sharp differences of opinion on this committee as to how we achieve near-universal health care.

CAMERON: But Republicans, greatly outnumbered, so far have little to sharply disagree on.

REP. DAVE CAMP (R-MI): Is there any timetable for the administration to release a specific legislative proposal on health care to the Congress, and if there is, could you shed some light on that?

CAMERON: Sebelius said no, the legislature will craft it with White House help. The president wants $634 billion for openers. It could cost more than a trillion the first decade. Again, no specifics from Sebelius.

SEBELIUS: You can't fully cost out a plan until you know what you're paying for.

CAMERON: The administration says if you like your current health care, you may keep it. Private employers may be required to help cover the uninsured. Public health care under Medicare and other programs will be expanded. The goal is more choice, competition, and less cost.

SEBELIUS: Reform must guarantee choice of doctors and health plans, including a choice between a public and private plan option that no American should be forced to give up a doctor they trust or a health plan they like.

CAMERON: But at least two key Democratic senators, Ben Nelson of Nebraska and Arlen Specter of Pennsylvania, who often craft centrist deals on controversial issues, oppose a government-run insurance program. Republicans warn if Uncle Sam regulates and provides health insurance, the private sector will face a crushing disadvantage.

RYAN: The way I see it, it's kind of like my daughter's lemonade stand competing against McDonald's. It's having the referee, the government, also be a player in the same game, and actuarially speaking, it's almost impossible to make that a fair game.

[end video clip]

CAMERON: Republicans further complain that the legislative process itself is no longer a fair game, because Democrats have said that they are willing to use the legislative short cut of reconciliation, which means they could ram health care through over Republican objections without getting the normal 60 votes needed to end debate. The GOP says that's an abuse of power that will not only hurt health care and just about everything else on Capitol Hill this year.

From the May 6 House Ways & Means Committee hearing:

SEBELIUS: The underlying issues are, what are the rules? What are the actuarial issues going in to the design of a plan, and is there a level playing field? And I can assure you, Mr. Chairman and some who have voiced opposition or at least at best skepticism about a public plan option, that the president is committed to and I'm committed to the fact that the design needs to level the playing field, and it's on two fronts. First, a public plan option should not undercut the private market, tilt the playing field in one direction. The private market, on the other hand, shouldn't be able to cherry-pick the least costly patients. So getting rid of some of the pre-existing condition medical barriers that allow a skewed marketplace I think is important, but having an option for individuals, having a choice for the Americans who don't currently have coverage, and having competition to drive the best practices, the best cost efficiencies, the best protocol, I think can be very positive in the long run.

[...]

SEBELIUS: What I can assure you is that it can be done as a level playing field. It's about the rules that are established in the beginning, and that the president and I are committed to working with members on this committee and members in Congress to make sure that the playing field is level. And as I said, the private insurers currently have in fact a -- I would say -- a tilted playing field in way too many areas where cherry-picking on the market is a strategy to make a profit, so that the ability to underwrite individuals' medical conditions to either make insurance unaffordable or unavailable is a current private-market strategy. I think that that measure doesn't work well in a health insurance exchange any more than a measure which would give government huge advantages and huge subsidies doesn't work well. So I think if the rules are the same so individuals who have lower income, who are not insured, have a subsidy benefit as they come into the health exchange and can choose between a public and private plan option with the same kind of rules, I think it can work as a very important competitive situation where it will help drive -- where people will be competing, public and private will be competing, not on underlying price or on unfair government subsidies, but really on practice and protocol, on lowering overhead costs, on lowering administrative costs and driving benefits to their incoming enrollees.