Published: Monday, 17 Aug 2009 | 8:53 AM ET

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Former Democratic Party Chairman Howard Dean, a leading figure in the liberal wing of his party, said Monday he doubts there can be meaningful health care reform without a direct government role.

AP Howard Dean

Dean urged the Obama administration to stand by statements made early on in the debate in which it steadfastly insisted that such a public option was indispensable to genuine change, saying that Medicare and the Veterans Administration are "two very good programs that have been around for a long time."

Dean appeared on morning news shows Monday amid increasing indications the Obama White House is retreating from the public option in the face of vocal opposition from Republicans and some vocal participants at a town-hall-style meetings around the country.

The former Vermont governor was asked on NBC's "Meet the Press" about President Barack Obama's statement over the weekend that the public option for insurance coverage was "just a sliver" of the overall proposal.

Obama's health and human services secretary, Kathleen Sebelius, advanced that line, telling CNN Sunday that a direct government role in a system intended to provide virtually universal coverage was "not the essential element."

Dean argued that a public option is fair and said there must be such a choice in any genuine shake up of the existing system.

"You can't really do health reform without it," he said. Dean maintained that the health insurance industry has "put enormous pressure on patients and doctors" in recent years. He called a direct government role "the entirety of health care reform. It isn't the entirety of insurance reform ... We shouldn't spend $60 billion a year subsidizing the insurance industry."

Dean also said he doesn't foresee any Republican support for a public option. "I don't think the Republicans are interested and in order to have a bipartisan bill, you've got to have both sides interested," he said.

The shift in the administration's stance on a government-run insurance program leaves open a chance for compromise with Republicans that probably would enrage Obama's liberal supporters but could deliver a much-needed victory on a top domestic priority.

Officials from both political parties are looking for concessions while Congress is on an August recess. Facing tough audiences, lawmakers and the White House are looking for a way to cover the nation's almost 50 million uninsured while maintaining political standing.

Sebelius said the White House would be open to co-ops instead of a public option -- a sign that Democrats want a compromise so they can declare a victory.

Under a proposal by Sen. Kent Conrad, D-N.D., consumer-owned nonprofit cooperatives would sell insurance in competition with private industry, not unlike the way electric and agriculture co-ops operate, especially in rural states such as his own.

With $3 billion to $4 billion in initial support from the government, the co-ops would operate under a national structure with state affiliates, but independent of the government. They would be required to maintain the type of financial reserves that private companies are required to keep in case of unexpectedly high claims.

"I think there will be a competitor to private insurers," Sebelius said. "That's really the essential part, is you don't turn over the whole new marketplace to private insurance companies and trust them to do the right thing."

Obama's spokesman refused to say a public option was a make-or-break choice.

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"What I am saying is the bottom line for this for the president is, what we have to have is choice and competition in the insurance market," White House press secretary Robert Gibbs said Sunday.

A day before, Obama appeared to hedge his bets.

"All I'm saying is, though, that the public option, whether we have it or we don't have it, is not the entirety of health care reform," Obama said at a town hall meeting in Grand Junction, Colo. "This is just one sliver of it, one aspect of it."

Lawmakers have discussed the co-op model for months, although the Democratic leadership and the White House have said they prefer a government-run option.

Conrad, chairman of the Senate Budget Committee, called the argument for a government-run public plan little more than a "wasted effort." He added there are enough votes in the Senate for a cooperative plan.

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