Insider's Insurance Guide

Landrieu is one of a handful of centrist Democrats reluctant to support the plan to revamp the $2.5 trillion U.S. healthcare industry, the top priority in President Barack Obama’s domestic agenda.

And she faces a tough choice: defy the wishes of her party on a legislative priority central to Obama’s promise of change, or defy the wishes of voters in her home state of Louisiana who are hostile to the proposals.

“Obama is very unpopular in the Deep South … and all of his legislation is unpopular,” said Bernie Pinsonat a pollster with Southern Media and Opinion Research, a survey company based in Louisiana’s state capital Baton Rouge.

“If she votes for this it will drag her down,” he said.

Raising the pressure on Landrieu is the delicate state of the bill itself. After a monumental battle, the House of Representatives narrowly passed its version of healthcare legislation this month. Louisiana’s Anh Cao, a first-term lawmaker whose heavily Democratic district includes poorer sections of New Orleans, was the sole Republican vote.

But unless the Senate bill attracts Republican support it will need all 60 votes that the Democrats control in the chamber to avoid a filibuster, or procedural block. One Republican, Olympia Snowe, voted for the bill in the Finance panel, but has not pledged her vote in the full Senate.

That puts Landrieu and fellow Democratic senators including Blanche Lincoln of Arkansas and Ben Nelson of Nebraska in a position of unusual influence.

It also offers a potential political advantage if she can persuade Louisiana voters of her reservations about a reform that would expand the federal government, analysts said.

“The controlling coalition of voters in Louisiana is opposed to health reform …. So she (Landrieu) has to talk small government solutions and low taxation,” said Robert Hogan, professor of political science at Louisiana State University in Baton Rouge.

“She is trying to … demonstrate her small government convictions but she is conflicted because this is a huge priority for Democrats,” said Hogan.

The Senate Democratic leader, Harry Reid, prepared on Wednesday to unveil the chamber’s bill, with the first test vote on the package expected by the end of the week.

MODERATE DEMOCRAT

Landrieu says she supports reform if it brings “stable, affordable health insurance” but she opposes a key element of the bill: a public option that would create a government-run plan to compete with private health insurers.

Reform is needed in part because of the crippling health bills faced by small businesses owners, Landrieu says.

“Small firms … pump almost a trillion dollars into the economy each year, create two-thirds of our nation’s new jobs annually, and account for more than half of America’s work force,” she said in an opinion piece published in October.

“Too much of their money is going toward high health premiums that are increasing faster than the prices of the products and services they provide,” said Landrieu, chair of the Senate’s committee on small business and entrepreneurship.

And on the face of it, health care reform that aims to provide universal coverage offers significant benefits to Louisiana, a state with high rates of poverty where more than 20 percent of the population lacks health insurance.

Instead of a government-run insurance option, Landrieu is seeking support for a plan to use federal seed money to fund an insurance plan that would eventually be run and operated by a private board.

“She’s a moderate Democrat. She understands that the public option is anathema in her home state,” said Elliott Stonecipher a pollster based in Shreveport, Louisiana.

POLITICAL PRESSURE

Landrieu does not face re-election until 2014 so would not face an immediate backlash from hostile voters, unlike Lincoln who is due for re-election in 2010.

Even so, for many Louisiana voters the reforms and the public option represent a further encroachment of Washington bureaucrats into the private sector.

“I am very concerned. If the government takes over the healthcare and it fails it will not go back to the private sector,” said Brenda O’Brock of Shreveport, Louisiana.

“With government in charge there will be no incentive to do better,” O’Brock said.

Such opinions are common given a state climate darkening for Democrats due to demographic changes, said Chris Kromm, executive director of the Institute for Southern Studies.

When Hurricane Katrina devastated New Orleans and much of the Gulf Coast in 2005 it tipped the state’s electoral balance toward the Republican Party by displacing hundreds of thousands of people, many of whom were blacks central to the Democratic Party in the Catholic south of the state.

As a result, trends favorable to Republicans right across the southeast — the country’s most conservative region — have been accelerated in Louisiana. The state voted overwhelmingly for Obama’s Republican challenger John McCain in the 2008 presidential race.

But Landrieu also faces pressure from within her party, not least from an African American minority that is key to her electoral base, particularly in the south of the state, and which supports health reform.