Obama's Health-Care Plan Would Include a Government Option

CHEVY CHASE, Md., June 7, 2009 -- President Obama stepped off a plane from Paris Sunday and into his next domestic crisis: health-care reform.

"The status quo is broken. We cannot continue this way," Obama said in his weekly address. "If we do nothing, everyone's health care will be put in jeopardy."

The president wants a health reform bill that covers all Americans on his desk by August, reaching for a goal that has eluded presidents for decades -- in a single summer.

He had planned to leave the details of health-care reform to Congress, as long as they met his broad goals for a plan that would "lower costs, improve quality and coverage, and also protect consumer choice."

But now the White House says he'll play a much stronger role, including demanding an optional government-run health plan.

"The president and many others believe that the availability of a public option alongside private options for people who need health care is, is a positive thing," presidential adviser David Axelrod told CBS. "He is going to promote that as part of his plan."

ABC News has learned that Sen. Edward Kennedy, D-Mass., who has vowed to make health care "the cause of my life," has drafted a plan that would require employers to insure their workers. A Kennedy aide cautioned that was a "draft of a draft" and could be changed.

Health insurers are skeptical of Democratic efforts that could present them with a government rival or restrict their profits. Blue Cross Blue Shield of America is planning advertisements opposing a "government plan," without mentioning that the new plan would pose a rival to the company's own.

Republicans -- left out of the administration's planning -- have already drawn battle lines.

Republican Senate leader Mitch McConnell, R-Ky, has taken to the Senate floor all week, repeatedly lambasting what he calls a "government takeover of health care."

Republican Sen. Chuck Grassley on Sunday sent this angry message via Twitter: "pres obama you got nerve while u sightseeing in paris to tell us 'time to deliver' on health care."