Photo by George Lauby Bob Kerrey

If critics have the impression that Bob Kerrey is out of touch with Nebraska, the former governor is unfazed.

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“Everything I own is in Nebraska,” Kerrey told the Bulletin Saturday during a campaign stop in North Platte, “but if they hold to that false impression, they hold to it.”

Kerrey is co-owner of four family fitness clubs (Prairie Fitness Center), two restaurants (Grandmother’s) and two bars (Bob and Millie’s, all in Lincoln and Omaha.

“I pay income taxes here, property taxes here and own businesses,” he said.

Kerrey, a Senate veteran from 1989-2001, has lived in New York City for a decade. He entered the U.S. Senate race at the last minute and withstood a residency charge from the state Republican Party.

He met with a room full of Lincoln County Democrats for lunch at the Depot Restaurant as he traveled from Kearney to Scottsbluff.

He wants to get back to Congress to bridge the partisan divide.

“Republicans are dug in against any kind tax increase. Democrats are dug in against any significant changes in entitlements. We’ve got to find a way to change that," he said.

Kerrey is well-versed in funding shortfalls for Medicare and Medicaid. Nearly 20 years ago, he co-chaired a national study on entitlements with Republican Sen. John Danforth of Missouri.

That commission’s recommendations to restructure the programs went largely unheeded.

Now, it’s time for a major overhaul.

“You cannot spend your way out of the unfunded liabilities you have in Medicare,” Kerrey said. “The changes you’d have to make for people over the ages of 65 are somewhere between brutal and cruel. We have huge liability that is out of line with the revenue stream.”

Kerrey said Medicare could be strengthened if everyone were in the pool of insured, similar to the Federal Employees Health Benefits (FEHB) Program.

Under the federal employees program, employees, retirees and survivors enjoy the widest selection of health plans in the country, choosing from catastrophic protection with higher deductibles, or health savings/reimbursable accounts and lower premiums, or Fee-for-Service plans with Preferred Provider Organizations or Health Maintenance Organizations.

From those choices, individuals pick and buy their own private insurance.

A handful of insurance companies provide the various plans, Kerrey said.

“We pick it, and we pay for it. There is some subsidy, but the biggest subsidy is that there is a large group,” he said.

So-called Obamacare reforms are not his preference, but he said they are a lot better than the alternative of ever-more costly insurance and ever-more pre-existing exclusions.

A single Medicare system could be an alternative to, or the evolution of, the so-called Obamacare reforms.

“I think there would be tremendous benefits,” he said, “including a huge reduction in administrative costs, because it would be simpler for the provider to understand who’s paying for what and how much.”

But to accomplish bipartisan solutions, the way Washington operates needs to change, he said. To do that, the rules of the Senate should be modified, because party caucuses have way too much influence over individual senators.

Senators and representatives meet informally and agree to work together to accomplish goals. They are controlled by party leaders with the most years in Congress, who control appointments to committees.

Those who don’t vote with their party caucus can be punished with less influential appointments.

“The man who understood that well was George Norris, who founded the Nebraska Unicameral,” Kerrey said. “It’s very well understood that Norris didn’t like the conference committee structure in Congress, but the other thing he didn’t like were the caucuses. This isn’t a new phenomenon.”

Norris served in the U.S. Senate during the 1930s, then returned to Nebraska and led a petition drive to create the Nebraska Unicameral.

“He changed our state constitution and the net effect is that in the Unicameral there’s no Democratic or Republican leader, there’s no caucuses, the way they select their committee chairmen is different,” Kerrey said.

Kerrey promises to try to change the rules of the Senate, and believes he will have clout. Democratic Party leader Sen. Harry Reid has already told Kerrey his 12 years of seniority will be considered when leaders are appointed, if Kerrey can win the race.

Kerrey was the governor of Nebraska from 1983-87.