As the framework for health care reform legislation takes shape in the Senate, the issue of whether to include a government-run insurance option has emerged as the main area of disagreement between Democratic and Republican negotiators.

President Barack Obama in recent days clarified his support for a “public plan,— while the newest member of the Senate Democratic Conference, Sen. Arlen Specter (Pa.), announced his opposition. Senators in both parties have been unwilling to draw lines in the sand as they try to craft a bipartisan health care deal, but many conceded Tuesday that the divide over the government’s role will be difficult to bridge.

“It’s a big problem,— Senate Republican Conference Chairman Lamar Alexander (Tenn.) said. “It’s like putting an elephant in the room with some mice and saying, Okay fellas, compete.’ There wouldn’t be any mice left after a while.—

Hoping to balance competing interests, Sen. Charles Schumer (D-N.Y.) this week unveiled a health care proposal that includes a government option that would operate similar to private insurance — it would establish a reserve fund, charge premiums and co-payments, and offer tiered coverage that would be priced accordingly.

Schumer, the Democratic Conference vice chairman, is optimistic his proposal can fill the chasm over a public plan. Schumer, who acknowledged the divide will be difficult to bridge, presented his proposal Tuesday at a Finance Committee hearing.

“It’s going to be hard, and the devil is always in the details,— Schumer said. “But the outline that I put together was not pushed off the table by the private insurers.—

Republicans and some moderate Democrats worry that overhauling health care to include government-run coverage would drive private insurers out of business and leave Washington as the country’s lone insurance provider. The government, they argue, could undercut private insurers with lower prices, and once it owns the health-coverage market, control the doctors and hospitals patients use and the services provided.

Finance Chairman Max Baucus (D-Mont.) this month is holding a series of roundtable discussions to try to develop the policy outlines for a health care bill, with legislation set to be marked up in June and voted on before the August recess.

There is some speculation that Baucus might settle on a measure that does not include a public plan in order to win Republican votes — including that of Finance ranking member Chuck Grassley (Iowa). Grassley has previously voiced opposition to a government-run insurance option.

But a Baucus aide said this week that the Finance chairman is committed to a public-plan component, deemed critical to many Democrats. Some of the Senate’s liberal Members have expressed a desire to pass health care through reconciliation, contending that a bill that only needs 51 votes will do more to reform the system than one requiring 60.

“I don’t believe anyone should be able to say, Because we’re against it, we can’t put this into the plan,’— Sen. Benjamin Cardin (D-Md.) said. “If you believe in universal coverage, if you believe everyone should have the opportunity to have quality health care that’s affordable … then let’s look at the best way to get there.—

Cardin, a strong supporter of the public-plan option, said it would add more competition to the marketplace and ensure that coverage was available in areas where private insurers are hard to find. Obama, who campaigned last year on the need to implement a government-run insurance option but has been relatively quiet on the matter since moving into the White House, said during his prime-time news conference last week that he favors including a public plan in any final health care deal.

But a majority of Republicans, and a significant number of centrist Democrats, hold starkly different views. Specter, who last week bolted the GOP for the Democratic Party, made his opposition plain during a television interview Sunday.

Sen. Richard Shelby (R-Ala.) declined to criticize a government-run health coverage option specifically. But in discussing his fears over a health care overhaul, Shelby said he’s worried that the private insurance industry will be gutted in favor of “everything being central to the government,— diminishing a patient’s ability to choose doctors and receive quality care.

Sen. Mary Landrieu (D-La.) declined to speak out against a government-run insurance component. But in expressing the principles she believes health care reform should be built upon, Landrieu — a centrist on key issues like energy and the environment — sounded like a Republican.

“Democrats and President Obama are trying to give people a plan that they can afford that gives them the health care they want, when they want it, and that saves money for the Treasury,— Landrieu said. “We need the kind of change in a health care system where they choose their own doctor, choose their own hospital, have something that’s affordable — and when they need treatment they get it right away.—