I'm also in the US and the highlights feature is there and works on some websites.
I think you turn in on when you first click the reader button in the address bar for the first time. The only setting I see is in Safari->Settings->Advanced-> Allow Highlights to share web addresses with Apple, so make sure that's turned on also.
The reader button will show a purple star thingy when the highlight feature is available for that website and this is what it looks like in the pop-up window when it's working.
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This is what it looks like in reader mode.
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