While the national health care reform debate rages in Washington, Connecticut is proceeding with its own plan to provide coverage for thousands of uninsured state residents.

The work is the result of action by the state legislature last year creating a panel to devise a public health insurance plan, called SustiNet, that will be available to not only the uninsured but to small business and nonprofit employees as well.

An estimated 10 percent of the state’s population has no insurance, and the number continues to climb as unemployment rises, said Kevin Lembo, Connecticut’s Health Care Advocate and co-chair of the panel responsible for creating the public plan.

The panel hopes to have a preliminary draft completed by June, Lembo said. The final SustiNet plan will be submitted to the state’s legislature no later than Jan. 1, 2011. The ultimate goal is to have a public insurance option available by July 2012.

There are several obstacles to implementing a public insurance plan, however. The first is political: The bill creating SustiNet was opposed by General Assembly Republicans and vetoed by Gov. M. Jodi Rell. It took a veto override (Votes: SenateHouse ) by the Democratic majority to launch SustiNet.

With Rell deciding not to run for re-election this year, a new governor will consider any legislation implementing a public insurance plan. If another Republican wins the office and vetoes the plan, the Democrats’ ability to override will depend on their success in the November General Assembly elections. If Republicans win one more seat in the Senate, they will have enough votes to sustain a veto.

Another potential roadblock for SustiNet is the state’s fiscal woes. The SustiNet plan will come before the legislature as it struggles with a budget deficit projected to reach $4 billion by the 2012.  Various estimates put the cost of a public insurance plan between $500 million and 1 billion per year. Supporters say the initiative will save individuals and businesses $1.75 billion.

Finally, there is the question of how the plan might be affected by any health care reform passed in Washington. The SustiNet board members have said they are confident state and national reform can coexist, but until concrete law comes from D.C. it is too early to tell.

The law creating the SustiNet board gives the panel 60 days from enactment to analyze the impact of federal reform legislation. Rell also has created two groups to review federal action, the Connecticut Health Care Advisory Board and a committee called Rapid Review.

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