(Dow Jones) – Sen. Max Baucus said Friday the health insurance industry may have to compromise on a public insurance option to cover uninsured people or risk losing a spot at the bargaining table.

Baucus, D-Mont., who leads the Senate Finance Committee and is considered a key player in debates on legislation to overhaul the U.S. health care system, said that insurers would have to set aside their stated objections to a public plan option. The health insurance trade group America’s Health Insurance Plans, AHIP, sent Baucus and Sen. Edward M. Kennedy, D-Mass., a March 25 letter stating they oppose the creation of a new government-run plan to compete with private insurers.

“There is huge pressure for those who have initial concerns with the public options to start to work to try to find ways to make it work, because otherwise they’ll be left out in the cold,” Baucus said at a Center for American Progress event.

Insurers also stated in the letter they would be willing to end the practice of charging premiums to people based on their medical conditions. But AHIP also wants enactment of a law requiring individuals to obtain insurance, which they say would expand the amount of people in health insurance pools and balance out risk throughout the health care system.

While Baucus has not insisted upon a public insurance option as part of health care legislation, Democrats in the House, including House Speaker Nancy Pelosi, D-Calif., have called for such a public plan option. Baucus said Friday he wants to hold off on debating a public plan option until less controversial elements of health care legislation are settled.

But he maintained insurance companies should also assume an accommodating posture in discussing health care legislation.

“Insurance companies know that the train is leaving the station. Large companies know that the train is leaving the station,” Baucus said. “People know you can’t beat something with nothing.”