Public Option--resurrected from the dead?

The constant stomping on the public option by insurers and their supporters has made it look like it would take a miracle to get a real public option in health reform through Congress, although many commentators are convinced that the only way to reduce health care costs is by creating a possibility of a national system that people can opt into.  Just passing a law that guarantees that private insurers will get a payload of premium monies from people who will have to be partly subsidized by the federal government to be able to afford it makes no sense at all.  That's because the comparison with other countries suggests that one reason (among several) for our much more expensive health care is that we have private insurers in the mix with no incentive to cut premiums and every incentive to deny coverage.

I suspect that there has been a majority in favor of a strong public option all along, but the right-wing drumbeats suggested that the right's attack on anything governmental (and distaste for anything providing an "entitlement" to those who don't have much while supporting entitlements for private insurers whose business has to, apparently, be guaranteed a profit)  had made inroads among those who bought the nonsense of death-panels, the "government will dictate your treatment", and "if it's government, it will cost more no matter what" couple with "if its government, the private insurers will be 'unfairly' deprived of profits for how can they ever be expected to compete with government" (the latter two pieces of nonsense being based on diametrically opposed foundational arguments, which somehow opponents of a public option tend to disregard).

But now "[a] new Washington Post-ABC News poll shows support for a government-run health-care plan to compete with private insurers has rebounded ...and wins clear majority support from the public."  Balz & Cohen, Public Option Gains Support: Clear Majority Now Backs Plan, Wash. Post (Oct. 20, 2009).  Regretably, the largest majority exists for a state-run, only-available-to-the-uninsured option--that is the most beneficial to private insurers and the least likely to have long-term inroads on increasing health care costs.  Give them a little more time--eventually they'll all catch on, maybe, to the dumb-it-down game being played.

Comments

[Sara]

Of course, if you polled the people on the real effects of this "option", total control of healthcare by the government, then I am pretty sure the poll results would be different.

[LindaMBeale]

Sara, aren't you just scaremongering? "total control of health care by the government" is not what we are talking about and, if informed people are and stay involved, not at all likely.

Also, I am curious why you are always ready to see terrible intervention by government, yet find nothing wrong with actual intervention by private organizations. After all, the government is just our agent--we have the power, if we will only be informed and exercise it, to decide what the government will do. It is sometimes hard to exercise that power, because of the volume of misinformation spread by purported think tanks often acting as shills for the corporatist power centers and the media similarly acting as shills for their corporate owners, but it is possible. That contrasts with the intervention ACTUALLY engaged in by the private corporations that currently control our health care--from doctors who exploit our fears by ordering needless exams in their privately owned ventures to insurers that take our premiums and then deny us coverage or engage in delaying tactics to avoid paying for the care we are entitled to to pharmaceutical companies that twist the purpose of the patent laws by adding a tiny ingredient and then engaging in massive propaganda campaigns to convince people that they "have" to have the "new" pill that is much more expensive (because of the "new" patent) than the same old cheap pill that does the same job. Why don't you talk about that kind of intervention, where the profit motive has engorged itself on the health care system of this country, causing our health care to be both more expensive and less satisfactory than that of every other advanced economy? Why is it ok for private actors acting in their own best interests to be entrusted with the system, rather than governmental actors charged with acting in the public interest? This anti-government bias, in other words, makes no sense. We should look at what we want to do and determine which actors are best capable of accomplishing that. We have lots of experience with the results of a health care system run by giant insurers. It is inefficient, costly, and skimpy in not providing care. It's time to try a government system. The best way to try it is by creating a national system with dedicated tax funding. But the bias against government stemming from the Reagan "government is the problem" approach makes that impossible. So a government system that is readily available to anyone who wants to use it and in competition with the near-monopoly insurers that get a very lightly regulated environment in individual states is the next best thing. Let the companies (and the free marketarians) PROVE that they can really do a better job of cutting costs while actually providing the needed services, as they claim they can. I suspect they know they can't, and that is the reason they are fighting the public option with everything they can throw at it.

[Sara]

Linda,

You say,"we have the power, if we will only be informed and exercise it". Yet when I point out how the government is mis-informing the public, you say that I am "scaremongering". Which is it? Or, does it depend on which party is doing it?

If people, like you, want the government to take over insuring the health needs of Americans, that's fine. That is a valid viewpoint, and I would never deny anyone their opinion. The point of my post, and a point that cannot be disputed, is that there is really no option in the so called "public option". It is silly to suggest otherwise. The intent is to put private insurers out of business. Period.

Facts, that cannot be disputed:

1. Private insurers have to pay taxes and adhere to industry regulations - unlike the government.

2. Numerous Democrats, including the Speaker of the House, have stated that they will subsidize the premiums of low income applicants using funds from the general tax fund - something unavailable to private insurers.

3. The government can force certain benefits, and change the rules whenever it wishes - unlike private insurers.

As I stated in my post, the poll results are just a reflection of how "crafty" the Democrats have been in naming their proposal. If the poll asked Americans if they wanted government to replace all private insurers, the results would be vastly different. It is the truth, and I stand by my assertion.

[LindaMBeale]

Come on Sara. Just when did you point out how the government is "mis-informing the public"? Your comment merely CLAIMED that the "real effects" of a public option are "total control of healthcare by the government."

Now you are adding an assertion about active misinformation, with no support for it for for the comment you originally made. You do not even provide a link or indication of what sources or what type of statements you are relying upon to draw the conclusion that the option is one of "total control" or that the government is "misinforming". That is the essence of scaremongering, and I suspect you know it.

It is, for example, clearly NOT "total control" if the government will not dictate which doctor you may see, will not dictate which health care options you may pursue, will not dictate whether you stay with your current insurer or not, etc. "Total control" is simply a total misstatement of any proposed public option--even a national single-payer single-provider system would not provide "total control".

Your response is just about as silly. The various discussions of public options are a long way from a monolithic governmental entity that is intended to "put private insurers out of business." Too bad, in many people's views, since it is quite reasonable in an advanced and literate society to think that health care is one area where the greed incentive that underlies private insurance is misplaced. But nonentheless, those are the facts. period.

You are, furthermore, repeating the same old arguments you have made before, without responding to the factual responses to those arguments. So here goes, once again.

1) Private insurers are essentially non-regulated because they have successfully lobbied to avoid federal regulations and states, many of which have too many interests and too little money and power, vary considerably in how much they regulate or how hard they try to enforce their regulations. States have very little power since it is a question of national insurers and weak states, and there is a race to the bottom supported by states like Delaware. In many states, there are just one or two insurers with almost 100% of the market--talking about "total control of health care"......

2) I haven't re-done the research, but several years ago the statistics on the amount of taxes paid by financial institutions generally (including private insurers) put them somewhere near the very bottom of effective rates for corporations--very little paid in taxes. If you looked at "real" economic income, I expect you'd find they pay very very low rates of tax.

3) Governmental health care programs, if established, will have to adhere to mountains of regulations--just ask anyone at the VA whether there is regulation of government run health care or not. If you don't believe that the government can regulate itself, look at the draconian rules that were imposed on the IRS in response to a few abuse anecdotes which turned out to be blown up or just made up out of whole cloth.

4) Are you really going to claim that private businesses don't have funds from government available to shore them up? After I've written on this blog of all the ways they lobby for, and get, subsidies through the tax system? After we've seen the way Big Business (and insurers are part of the financial system) makes sure that its back is covered one way or another. The way the GOP is pushing for health care reform to work, the wealthy insurance comapnies will get guaranteed premiums (mandated by legislation) from a whole lot of new customers that are forced to buy insurance (that's sometimes called a subsidy and hard to differentiate from one in economic terms), while, if there is a public option, it will be restricted to the sick and poor, who will be covered by the US government. That's called privatization of gains and socialization of losses. That's a subsidy of private enterprise, in other words.

We'd be a lot better off, probably, just taxing all Americans at a progressive rate based on total income (capital and labor), and then using that money to fund the needed health care for anybody that needs it--just cut the private insurers out of the picture since they have proven themselves incapable of acting with any kind of corporate social responsibility.

What defenders of rip-off private insurers never make clear is why it is so important to protect the business of greedy companies who have driven us into the poor health care situation we are in because of their policies of denying coverage, raising premiums, and skimming profits above all? Many of the people who go into bankruptcy annually in this country are driven there by catastrophic medical bills. AND MANY OF THOSE PEOPLE HAVE INSURANCE. Those companies are not sacred, yet you treat them as though they were. Sometimes, private business is not best suited to run some activities, and I would personally prefer to see a single payer single provider system, based on everything I've read about the issue to date. But we won't be able to get that, so at least we should force the hitherto coddled insurance industry to step up to the plate and show their mettle. Either they CAN provide better care at lower cost than government can--as the right proclaims day in and day out-- or they can't. You are trying to have the best of all possible worlds. Oh, you say, "you can't compete with us because you will be subsidized and able to do better." And at the same time, you say "you can't compete with us because you are no good--you just cost more and deliver less." Those two statements are contradictory. Let's have a public option and find out which is true.

By the way, do you have any experience in designing statistically verifiable polls? The whole point of designing statistically valid polls is to ask questions in ways that do not prejudice the answer. To assert, as you do, that a Washington Post-ABC News poll is the "Democrats" is simply absurd. The WaPo has moved far to the right over the last 20 years or so, and ABC News was never on the left to start with. Neither is owned or operated by the Democratic Party. So again, your post is full of assertions that are not backed by any evidence but are merely repetitions of the right-wing blogosphere (mostly funded by an odd coalition of Big Business and other groups). So assert all you want, but you've given me and my readers no reason to think that what you say is based in fact.

[Sara]

Linda,

Wow, Ok, let me respond.

1. I am not a defender of the private insurers in any way. I believe they have gamed the system for their sole profit and are a major problem in our current system.

2. I never claimed that any poll was just a poll of Democrats.

3. Many times you defend the "public option" by stating the current problems with our system.

"In many states, there are just one or two insurers with almost 100% of the market--talking about "total control of health care"......".

and

"Many of the people who go into bankruptcy annually in this country are driven there by catastrophic medical bills. AND MANY OF THOSE PEOPLE HAVE INSURANCE. "

But there is a difference in restating the problems with our current system, and defending a solution.

4. I have never stated an opinion on if the government running healthcare would be better or worse than our current private insurance system. Those are your words, not mine.

My point was simple and accurate. And it is this. If the government is able to use tax revenue to undercut private insurers, create their own regulations, and change the rules on a whim, it will put private insurers out of business. Calling this ability an "option" is misleading. And, if the poll was worded to ask the American people if they want only government to be in charge of healthcare insurance, the results would be different.

Finally, if the government was the sole provider of health insurance in the country, they would effectively control healthcare. They would set prices, determine what procedures would be compensated, and dictate premiums. And the American people would have no choice but to accept these directives, because we would have no other options.

And before you tell me how wrong I am, you might want to reflect on the fact that this is EXACTLY what the government does now with Medicare. EXACTLY.

[jamz]

one recurring thread in the health insurance debate is "put the health insurance plans out of business"

this states an extreme outcome, an outcome that may or may not be realistic

the fear is stimulated the the public option tied to medicare rates idea which most agree force significant changes in the health insurance market

what would be so "wrong"- "bad" about changing how health insurance is organized and sold in the united states?

from the experience of other countries it is clear that other forms of health companies exist and do well for their customers

they are not for profit investor owned companies

wall street and health insurance executives would not like to give up health insurance plans as we know them now

does anyone else really want to preserve this failing business activity?

the giant of health insurance is blue cross, a federation of 39 separate health insurance organizations and companies - combined they
Combined, they directly or indirectly provide health insurance to over 100 million Americans

they were the original hmo, doctors and hospitals led the way in oranizing not for profit health insurance plans under the blue cross identity

in 1986 blue cross health plans "lost their tax exempt status"

they didn't really lose something - in effect they were privatized

i think of it as sort of like what happened in russia and china where ownership of many industries were taken over
by insiders

some states still treat them as tax exempt and the general public thinks of them in their historical non-profit identity)

in reality many are now publically traded companies, like anthem, a 14 state company

some are private companies - highmark, carefirst, premera, regence, wellmark

there are 36 or so blues with business in one state only

[LindaMBeale]

Sara
1) You may think that you are not a defender of private insurance, but most of what you have said (on this posting and on other postings about health care reform) sounds like a defense of private insurance as something that we need to preserve.
2) putting your comment about the poll together with your comment about "crafty" Democrats, you imply that the polls don't accurately determine the views of the people polled because the Democrats have controlled the polls by their crafty terminology. My point is that pollsters know their way around crafty terminology, if they are trying to do an unbiased poll, and since neither the WaPo nor ABC is controlled by Democrats, there's no reason to think the polls are misleading.
3) The way the system currently fails is relevant to whether or not a public option is a good idea. What we have is a purely private option. If you want to know whether a public option is good, part of the assessment is--as compared to what. The 'as compared to what' item is private insurance. Our private insurance has failed and our private insurance system in many cases does NOT allow competition. So if the status quo doesn't permit genuine competition, a claim that the public option doesn't permit "real" competition even though it clearly permits some kind of competition because it WILL NOT BE A MONOPOLY under any of the versions being considered is a very weak argument and pointing out the weakness of that argument is highly relevant to defending the public option as a solution.
4) Yes, based on your postings here and elsewhere on this topic, I concluded that you were defending private insurers and did not like the idea of government run healthcare. But beyond that, you are wrong on the facts of whether the "public option" is an 'option' or not. You hypothesize one thing (government being able to use tax revenue to "undercut private insurers" while "creating their own regulations" and "changing the rules on a whime" that will "put private insurers out of business" and then you call that the "public option" and say "option" is "misleading". Wow. Let's get this straight. Government ability to "change the rules on a whim" is always there--it can and does change the rule to FAVOR private companies all the time (look at all the tax susbsidies for natural resources extraction, etc.). It can and does "use tax revenue to" subsidize or to "undercut" private companies--we use it to undercut when we enact an excise tax on an activity to discourage it. We use it to subsidize when we give the company a tax break not given to other businesses (and private insurers get LOADS of those kinds of tax breaks in the code right now). Government of course, is the only source of laws--except when we let companies "self regulate." HEALTH INSURANCE IS IN MANY WAYS A SELF_REGULATED ENTERPRISE AT THIS TIME. That is why, of course, they are so efficient at denying coverage to people who thought they were covered, etc. States can regulate, and the federal government doesn't. Insurers can "forum shop" for the state that they like the best as headquarters. They can work in a state only if they have monopoly or near monopoly conditions, and in fact that is the case in many state markets. So the ability of the government to regulate is just part and parcel of the basic distinction between public and private. Sure, the government COULD put any business out of business with a stroke of the pen--by making that business illegal. So what? That's clearly not what any of the public options on the table are about. They are not about "total control of healthcare". Most of them are not even about providing all of the public an option. Most are only about the potential for an option for some people in some cases. So you are being especially misleading in your argument that calling it an option is misleading. It would be misleading to conduct a poll about the public option by asking a question worded to distort results to make people think that a public option means that "government" would be "in charge of health care insurance" or "the sole provider of health insurance in this country."

I said that I thought a sole provider approach would be best. But that regrettably is not even on the table. Even if the government was the sole provider, it is not clear what that would mean--7you say--set prices, determine compensation, dictate premiums. That's not sole provider--that's single payer. I don't think any of the public options is for a single payer system, much less a sole provider, single payer system.

You are raising what is called a straw man argument--something you think will scare people enough that they won't support the public option. A dictatorial government controlling all health care decisions.

By the way, Medicare doesn't dictate all decisions to Medicare recipients. YOu need to get your facts straight. Medicare recipients go to the doctor of their choice. They may have other insurance or they may have private funds. Medicare limits what it will pay and what procedures it will cover, just like every single insurance system does. At least those decisions are made by an agency that is charged with having the public interest in mind instead of an agency that is charged at making a profit (and damn the patient, if it gets in the way of a profit). But the point is that your "exactly" point is exactly wrong. A person on Medicare right now has a choice about what they do, if they can afford otherwise, just as a person on private insurance does.
They have no choice, if they can't afford otherwise, just as a person on private insurance does. With the caveat that--if it is public, they can vote out the representatives that instated the rules that limited their choices. If it is private, they may not even be able to simply change insurers (in states where one insurer has a quasi monopoly) and even if they can change insurers, all of the insurers may be handling this matter in the same way (not unlikely at all), so that no change is possible and they don't have the market power to bring change about.

Now, how do you like them apples?

[Sara]

Linda,

I contend that the "public option" is not really an option, but a way to put private insurers out of business. As such, I feel it is wrong for the politicians to "spin" it as an option, when we will just go from limited to choice to no choice.

You continue to assert that I am wrong. Yet after hundreds of words posted, you have not offered a single word on how the public option will not put private insurers out of business. You continue to change the subject, restate problems with our current system, and extole the virtues of government run assistance. But, you never address my position. I am wrong, even though you cannot offer a single reason why I am wrong.

If the American people want the government run healthcare, that is fine. But they should be told the truth, instead of being misled. It is wrong when Republicans lie to the American people and it is just as wrong when the Democrats do so as well.

Let's be honest, if the Republicans were misleading the American people, you would be writing everyday to point out their lies and deceptions.

[LindaMBeale]

Sara, what I have shown several times is that there are quite a few different versions of possible public-private alternatives to a purely private remedy under discussion. Several of those alternatives (the ones that only come into play if "triggered" by certain eventualities), clearly wouldn't, in and of themselves, "put private insurers out of business" unless private insurers were unable to reduce costs the meager amount required under those triggers. Other versions of public remedies would do somewhat more--allowing a small, state-based, public payer system, that would be available only to a very few people (mostly the most risky that the private insurers don't want to ensure in the first place) while still giving the private insurers guaranteed additional profits from mandatory premium payments by many of the uninsured who are perfectly healthy and low-risk individuals. That type of option also would clearly not "put private insurers out of business". A somewhat more robust option is a national exchange, but most versions suggest it would still be available only to limited people and that it would have various restrictions--like not being able to use the clout of medicare to reduce pricing. That option also clearly would not put private insurers out of business. The only option, in fact, that would clearly have the possibility of putting some private insurers out of business is a radical revamping of our health care system along the lines of those other countries' systems where there is a single-payer system (nobody uses private insurance except for supplemental insurance) or a medicare-like system for all (nobody uses private insurance except for supplemental insurance). In other words, there are a variety of public options, and only the choice of the radical option which has been left almost completely off the table by Congress--creating a national health care single payer system like Medicare for all--would limit private insurers' business. All of the other options proposed allow people to stay in their private insurance. All of the other systems proposed restrain the way the public side works. None of them amount to "putting private insurers out of business". So you can assert all you want that I haven't "addressed" your position or that I haven't provided "a single reason why "[you] are wrong, but that's simply not true.

Since you are wrong on whether a public option eliminates per se private insurance, you are also wrong on whether the public is being misled if people talk about a variety of public options. They are not. To use the term "public option"--especially when most versions of it are so terribly weak--is simply not to use "lies and deceptions."

By the way, you continue to try to reduce your argument to a one-sided position (if there is anything public about it, it will put the private insurers out of business) and therefore to refuse to take into consideration counterarguments that are more complex, because they look at the interrelatedness of a variety of factors. That's another one of the ways that the right has tried to flummox ordinary Americans and fool them into buying zany theories. Reducing complexities to black and white statements that disregard the depths of the issues involved or the context of any conclusions about the situation is not being honest. It is a prime example of a way to "spin" a topic.

[Zack]

“Why is it ok for private actors acting in their own best interests to be entrusted with the system, rather than governmental actors charged with acting in the public interest?”

This is an interesting question. My own observation is that individuals who work in government behave in a very similar manner to individuals who work in corporations. They, or at least those in leadership positions, are overwhelmingly motivated by whatever will improve their status and position within the organization. This type of behavior is quite universal all the way from the school playground to super-power diplomacy. The net result of this is that organizations (both corporate and governmental) tend to behave in a way that maximizes their own economic power and control. This is not always the case, but it is a strong tendency that applies equally to both government and corporations.

So why should we assume that government acts in the public interest? In theory if voters always understood what was in fact in the public interest, punished or rewarded politicians at the ballot box based on how well they acted in the public interest, and politicians responded to these rewards and punishments rather than the preexisting institutional biases of government itself, then their might be some merit in this assumption. But history has show that far too often governments act in their own best interest rather than the public interest. Democracy while perhaps the lesser of evils certainly doesn’t solve the problem.

I really don’t like either party’s position in the health care debate. I think the Democrat approach is a scam. They are treating the problem as if it were an insurance problem and if only we had more and better insurance then more doctors, nurses, and hospitals would magically spring into existence. In reality the outcome is predictable. With all the mandates and restrictions on insurance companies the rates will go through the roof. Assuming more widely available public insurance, the increased demand will allow and cause doctors and hospitals to accept only the more generous insurance plans and turn away Medicare patients.

People and government will both be furious. Government costs will be far beyond projections. Democrats will blame greedy doctors and insurance companies and want to do a complete takeover including uniform price controls and coverage mandates of all insurance plans, and oversee doctor and hospital scheduling to insure fairness. Republicans will blame Democrats and government for destroying the health care system and want to take over the government to “fix” things. I would guess it’s about 50/50 as to who will win that argument.