This is brilliant ...
That gives you an essentially national administrative structure, but also gives states the right to reject the option entirely. It means, in other words, that the blue states get the public option at full strength and the red states get to ignore it entirely.
From a political perspective too, it's going to be difficult for states that oppose the public option to remain outside of its influence for long. If the public option does what most people think it will do - lower costs and expand coverage - then states that opt out are going to feel pressure to permit it in their exchanges, regardless of their ideological preferences.
I like this idea. Let's give it a whirl.