As expected, the Senate Finance Committee rejected two amendments yesterday that would have added a public health insurance option to the health care reform bill Chairman Max Baucus drafted with a big assist from industry lobbyists. Five Democrats voted with all the committee Republicans against Senator Jay Rockefeller’s amendment, which would have created a national public option tied to Medicare rates. Three Democrats also joined Republicans to vote down Senator Chuck Schumer’s much weaker “national level playing field” public option. CA Berkeley WV liveblogged yesterday’s hearing for Congress Matters.

Senator Chuck Grassley sang the same old song about the “government run plan” forcing private insurance companies out of business. He got a little tripped up when Senator Chuck Schumer asked him for his views on Medicare, though.

“I think that Medicare is part of the social fabric of America just like Social Security is,” Mr. Grassley said. “To say that I support it is not to say that it’s the best system that it could be.”

“But it is a government-run plan,” Mr. Schumer shot back.

Mr. Grassley, a veteran Senate debater, insisted that Medicare did not pose a threat to the private insurance industry. “It’s not easy to undo a Medicare plan without also hurting a lot of private initiatives that are coupled with it,” he said.

Chairman Baucus scored highest on the chutzpah meter, praising the public option even as he refused to support it. Grassley also held out false hope that maybe someday some other bill will accomplish that goal.

Several Senate Democrats, including Tom Harkin, insisted yesterday that they will get some kind of public option into the bill that reaches the Senate floor. After the jump you’ll find lots of links on the battles to come.

I agree that the public option is not dead yet, but for it to survive, President Barack Obama and Senate Majority leader Harry Reid will need to do a lot more than they’ve done so far to lean on the Senate conservadems.