Regardless of whether anyone was watching, or anyone watching was persuadable on the issue of health care, President Obama’s health care address last night will be chalked up as a victory for one reason: He lowered his expectations.

The president confirmed last night that he doesn’t want health care reform anymore; he wants health insurance regulatory reform.

Look at the key elements of the president’s “plan”:

• It will be against the law for insurance companies to deny you coverage because of a preexisting condition.
• It will be against the law for insurance companies to drop your coverage when you get sick or water it down when you need it the most. 
• They will no longer be able to place some arbitrary cap on the amount of coverage you can receive in a given year or in a lifetime.
• We will place a limit on how much you can be charged for out-of-pocket expenses. 
• Insurance companies will be required to cover, with no extra charge, routine checkups and preventive care, like mammograms and colonoscopies.
• We’ll … creat[e] a new insurance exchange – a marketplace where individuals and small businesses will be able to shop for health insurance at competitive prices. 
• For those individuals and small businesses who still can’t afford the lower-priced insurance available in the exchange, we’ll provide tax credits, the size of which will be based on your need.
• All insurance companies that want access to this new marketplace will have to abide by the consumer protections I already mentioned.
• Individuals will be required to carry basic health insurance – just as most states require you to carry auto insurance. 
• Businesses will be required to either offer their workers health care, or chip in to help cover the cost of their workers. 

President Obama even couched his public-option proposal (which he’s sort of for, but not all that committed to, which we knew before the speech) as an insurance reform measure: “To my progressive friends, I would remind you that for decades, the driving idea behind reform has been to end insurance company abuses and make coverage available for those without it. The public option is only a means to that end.”

In a classic Goldilocks moment, the president explicitly rejected the two more aggressive health system reform ideas he sees at either end of the ideological spectrum: “There are those on the left who believe that the only way to fix the system is through a single-payer system like Canada’s where we would severely restrict the private insurance market and have the government provide coverage for everybody. On the right, there are those who argue that we should end employer-based systems and leave individuals to buy health insurance on their own.”

(Yes, “leave them” – abandon them into the cold market, where they’ll likely freeze and go hungry and develop boils and die.)

No one was surprised to find out the president rejects both of those approaches and seeks one that’s just right, somewhere between those, but certainly more toward that single-payer thing.

Health insurance reform versus health care reform may seem to be a distinction without a difference, but there is a difference: One won’t really do anything to change the cost drivers of health care delivery, the other will; one is a heck of a lot easier to pass, the other, as we’ve seen, is more fraught.

This is the president settling. We know he wanted a reform package that would put us on the road to single-payer health care. But all the “games” and “misrepresentations” President Obama tut-tuts turned out to be the public making its opinion known and forcing the president into a compromise.

If he had come out in the spring and said, “Hey, listen. We need to provide some more consumer protections in the health insurance market – don’t let companies drop coverage, create a pool for high-risk individuals,” he’d probably already have a bill by now.

Instead, he went for the jugular – a public health care plan that would have driven private insurance companies out of business (not overnight, but over time). Now he’s off that wagon and he’s laid the framework for a less ambitious and more achievable package of insurance reforms.

It won’t come cheap – despite Mr. Obama’s laughable predictions, consumer protections always cost consumers money – but the president will be able to say he got something.