Thread: Diluted ‘public option’ stirs more fervor than it’s wo

Diluted ‘public option’ stirs more fervor than it’s worth

Fate of medical overhaul shouldn’t ride on government-run insurance.

Discussion of health care reform has often been angry and detached from reality. Witness this summer's hysteria over the imaginary "death panels." With the Senate set to begin debate today, some of the most bitter and least reality-based arguments are now about the "public option," a government-run insurance plan designed to compete with private insurance companies.

But the public option that remains in both the House and Senate bills has been so weakened that it's neither the threat critics imagine nor the powerful force that we and other supporters had hoped to see. As things stand, it's a wonder that so many people are fighting so much over something so toothless.


The public option was originally envisioned as a way to dynamically drive down costs. With no need for profits and lots of market leverage, the government could offer people more for less by letting them buy into a Medicare-like plan, or Medicare itself.

If the plan was run well, millions would opt in. If critics' legitimate fears about government bureaucracy and ham-handedness came true, it would prove unpopular. Either way, Washington's polarizing, lobby-driven debate would be bypassed. The public would vote with its wallets.

But that concept is long gone. What's left, after lobbyists and political opponents helped weaken the plans, is a hobbled version of a private insurance company. It would have to negotiate with doctors and hospitals without enough customers to give it much clout. The Congressional Budget Office says its premiums would be higher than the average for private plans.

That's a real shame. The insurance market could use competition. Studies by the American Medical Association show that in at least nine states, a single company has 70% or more of the market. In Vermont, Alaska, Rhode Island and Hawaii, just two companies share at least 90% of the market.

The CBO, the neutral arbiter in this debate, estimates that the House version of the public option would attract 6 million customers over the next 10 years. The Senate version, which would allow states to opt out, would attract even fewer — no more than 4 million. By comparison, giant insurance companies such as WellPoint Inc. or UnitedHealth Group already have more than 30 million customers each.

At this point, about the only virtue of keeping the public option is that fixing it later would be easier than fighting this battle all over again to create it. That's trivial compared with the core goals of reform: to expand health coverage and make it more affordable; to force insurers to drop noxious practices, such as excluding people with pre-existing conditions; and to prevent people from going bankrupt simply because they get sick. The challenge is to do all this while managing to bring surging medical costs under control, something neither bill does convincingly.

Unfortunately, the ideological debate over the public option threatens to overshadow these more important issues. Sen. Joe Lieberman, I-Conn., calls the public option "radical" and vows to oppose it as a "matter of conscience." Meanwhile, Sen. Bernie Sanders, I-Vt., has suggested that he and other senators might vote against the health overhaul if it doesn't contain a government-insurance option.

In truth, the diluted public option would be a modest plus, but if it drops out, that should not be a reason to torpedo changes that will improve millions of lives.

Posted at 12:23 AM/ET, November 30, 2009 in USA TODAY editorial

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By the numbers

The House and Senate health reform plans both include public insurance options, but the Senate version would let states opt out. Projections of how many people would enroll in the next decade:

30 million (total insured though new "health exchanges")

6 million (House public option)

3-4 million (Senate public option)

Sources: Congressional Budget Office, Kaiser Family Foundation

Posted at 12:22 AM/ET, November 30, 2009 in USA TODAY editorial

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