Everything that happened in the health reform effort last week was expected.

The Senate Finance Committee failed, again, to produce any "bipartisan" revenue or policy agreement, because not one of Baucus’ "coalition of the willing" is willing to fix what everyone knows is broken. If anything emerges from this group, it will likely be an insult to reform advocates.

Once again, Senator Conrad failed to provide any definition of his nebulous co-op proposal. He hasn’t released a credible policy paper or even a description that explains how his "non-federal" member-controlled state co-ops can function at a national level or compete against mega insurers. We don’t know how it could be governed or have industry-wide leverage on the cost issues that CBO worries about. And if it’s not national, there’s a portability problem. In short, it can’t do what a national public option can do unless it becomes a national public option.

We’ve had local co-ops for decades, and some are fine in their limited markets, but they’d done nothing to keep the insurance and provider industry from becoming more and more concentrated, from fixing prices and from raising rates/premiums three times faster than wages. Someone needs to ask Kent Conrad, "where’s the beef?" because he’s been getting a free ride.

The Senate’s failures were obscured by the nasty dispute in the House Energy and Commerce Committee. It was an opportunity for the Blue Dogs to prove they’ll use any excuse to undermine reforms.

But much of the media continues to assume the Blue Dogs actually care about fiscal responsibility, even though the Dogs’ actual proposals would, as Krugman notes today, raise costs or undermine the reforms. Attention media: Paying more money to their local providers, raising public plan rates above Medicare levels and weakening the public plan’s ability to force private insurers to compete will raise costs, not lower them.

And despite the fact that Orszag and Obama have been pushing for months to strengthen MedPAC and create an independent advisory council to recommend cost-effecive provider reforms, the media keeps reporting this as though it were the Blue Dogs’ idea with liberals opposed to cost-cutting per se. Gibberish.

The real debate is between the Executive and a wary Congress, which knows a future Republican Administration could use the advisory council’s independence to undermine Medicare and Medicaid benefits. Liberals are right to demand more safeguards before agreeing.

Apparently the media can’t see the connection between increasing payments to the health providers that dominate most rural areas and the campaign contributions that flow into Blue Dog coffers. The Dogs are not saving the federal budget; they’re extracting pork — rents to reward their contributors, the insurers and providers that dominate local markets.

And no matter how many concessions they extract, they’ll demand more. They can do that because they don’t care if health care reform fails. The people they’re negotiating with do care, and that’s why the extortion works. It would be helpful if the media could stop fawning and call them out.

The least surprising event occurred at the end of the week when the CBO rendered another predictable but useless "score" claiming that the advisory council’s incentive reforms won’t save much money. Why did we even ask them?

CBO concedes it has no clue how to estimate the effects of payment incentive reforms that make sense but can’t be quantified until they’ve been tried. So far, the CBO has provided one useless analysis after another.

But that’s the pattern here. We have CBO doing analyses that often don’t or can’t measure what matters, Blue Dogs making demands that should earn them contempt, and the media unable to recognize who’s trying to sabotage reforms.

Then we have self-appointed Senate negotiators pretending that if you don’t pose a major challenge to the profit-based insurers and providers who have a secure stranglehold on America’s health care system, you can fool the American people one more time. They may be right.

The reformers have one shot, a slim one, at changing that equation, and it’s planting the seeds of a public plan that can redefine the model and challenge the industry over time. As I’ve written several times, the current bills deliberately hobble the public plan and strictly limit access in the initial years. And they have little choice, because if they open the gates too soon or too wide, and thus increase the need for subsidies, the CBO will score the bill’s budget impact at levels that could never be supported by a Congress that can’t even agree that the wealthiest 1 percent are long overdue for contributing more to the public interest.

That’s where we are, and it’s discouraging, but no one told us this would be easy. It’s still worth fighting for, IMO, so don’t even bother me with the cynicism. It’s not helping.

Update: A good read on CBO cost estimates: Maggie Mahar, Who is Douglas L. Elmendorf and why is he throwing cold water on health reform?

Also worth reading:
Paul Krugman, Why markets can’t cure healthcare
David Leonhardt, Forget who pays the medical bills; it’s who sets the costs
Peter Orszag, CBO and IMAC
Leonhardt, more on the CBO vs Orszag; also, Challenge to health reform
Ezra Klein, the ghosts of Clintoncare
NYT editorial, pretty good summary of the major bills
Think Progress/Wong Room, starting here with Grassley spinning
Kaiser Health News, summary of Wyden plan
NYT Caucus, new CBO estimate of number of workers that would lose and gain insurance at work