Opponents of the public plan want to scare Americans, so maybe it doesn't matter that the arguments are fundamentally contradictory--they just need to be really scary.

Back in March, the National Journal invited opponents and supporters of the public plan option to briefly lay out the arguments for and against here. While the rhetoric has gotten louder, the positions mostly haven't changed.

On the one hand, opponents say a public plan option will be so popular that it will "engulf" the private insurance market--repeatedly citing the Lewin study that we've already discussed here.

What does that mean? You will like the public plan so much--because you get better benefits for less money--that you will choose it over the packages offered by private insurance companies.

At the same time, opponents also say a public plan option wouldn't pay doctors enough, so your doctor wouldn't be there. Since millions of you wouldn't buy a plan that your doctor refused to join, it hardly sounds like something that would destroy the competing insurance market.

According to yesterday's Chicago Sun Times about President Obama's appearance before the American Medical Association (AMA), the AMA is leery of the public plan on exactly those grounds.

While in concept the AMA supports all Americans having health care coverage, the organization wants to avoid an outcome where payments to physicians treating patients in a government-run plan are capped at rates lower than private insurance companies pay.

We support a public plan option that is competitive with private insurance AND pays your doctor enough to get him or her into the system.

Assuming it pays doctors what they would get from private insurance companies, a public plan is still likely to be very competitive in price and benefits to private insurance, and so push insurance companies to give you more for less as well. If insurance companies want to keep playing games with rates and benefits, you will always have a reliable public alternative to turn to. But if they play straight with you, you will have no reason to leave.

The public plan will need to pay doctors competitively with private insurance to ensure that your doctor will be in the plan. No one is advocating a two tier system in which private insurance gets the best doctors and the wealthiest patients while the public plan struggles to find a few doctors to serve the poorest people. We already have that system, it’s called Medicaid, and we know it doesn't work very well in most states.

Since the public plan will pay doctors enough to work for it, and will still give insurance companies a run for their (your) money, we really don’t have to worry about the final scare tactic—that this is a sneaky way to open the door to government run health care. President Obama yesterday responded to this directly in his comments to the AMA:

What are not legitimate concerns are those being put forward claiming a public option is somehow a Trojan horse for a single-payer system. I'll be honest. There are countries where a single-payer system may be working. But I believe – and I've even taken some flak from members of my own party for this belief – that it is important for us to build on our traditions here in the United States. So, when you hear the naysayers claim that I'm trying to bring about government-run health care, know this – they are not telling the truth.

President Obama spoke to the second most important group who must accept and support the passage of strong health reform--the doctors. But the very most important group is you, the person who needs what's in that health insurance plan, maybe not today, but some day. We've talked to you, and you are clear about what the problems are. But already the discussion in Washington is drifting far from the realities you face and the priorities you've described to us--choice, security, freedom. We look forward to the coming months when the President brings his plain talk about cutting cost and improving care directly to you.

comments (25)

Comments

1 Posted by Ray at 06/16/09 01:52 PM

I could not agree more. I work for the government and if you think government health care is the answer, you are in for a really big disappointment. Look forward to long waits for services and rationing to the elderly. If that isn't bad enough, check the estimated cost to just insure 16 million. Over a trillion dollars according to the non-partisan OMB. I don't think we can afford much more of this nonsense.

2 Posted by John C. Fuhr at 06/16/09 04:53 PM

Heathcare is not the first problem we've got to solve. Healthcare *insurance* is the problem.

Add:

1. The total of all salaries/fringes paid to health insurance employees.
2. The cost of insurance companies' buildings
3. Insurance companies' buildings
4. Insurance companies' equipment, furniture, fixtures, vehicles, computers and equipment.
5. Insurance companies' lobbying expenditures.
6. Insurance companies' profits/overages.

The total of all this is staggering, and is your money that's not going to doctors, hospitals or other health professionals -- or remaining in your pocket.

John C. Fuhr
Paratherm Corporation
4 Portland Road
West Conshohocken PA 19428
610-941-4900
jfuhr@paratherm.com
www.paratherm.com

3 Posted by Victor at 06/16/09 06:32 PM

The government should present the people with a business plan,since now their in the private sector.Bottom line....Fix social sercurity and the VA system.

4 Posted by Eric Fanning at 06/17/09 02:04 AM

We here in the good ol US of A are the exception to the rest of the industrialized world when it comes to health care. We spend the most. And yet we have over 50 million without health insurance. I would ask what value does the insurance industry add? I know that the insurance industry takes 31 cents for every health care dollar spent. I know the CEO’S need to get paid.
Personally I do not support the Public Option and am also critical of Consumers Union for limiting the debate on the issue. I support Single Payer health care reform The House Bill is HR 676 sponsored by John Conyers of MI.. This would eliminate the health care insurance industry, which I view as a good thing. Yet the Doctors, Nurses, Hospitals would stay private. Our health care system is broken. The minds that created this problem will not fix it. Do you want health care reform that benefits we the people, or the insurance industry?

5 Posted by Robert at 06/17/09 10:02 AM

One question I do not see being addressed is "would a government run public plan be subsidized, creating an unlevel playing field for competition. A corollary question is "would politicians be able to resist that temptation." Also, would not dozens of insurance companies alone provide adequate competition to obtain business?

I see a wide variety of views expressed here. Some merely repeat partisan rhetoric. Others opine without an understanding of the overall systemic problems and their causes. Some seem to be reasonable.

Most Americans are preoccupied with their own healthcare benefits without regard for the costs and their unsustainability. When 3rd parties foot most of the healthcare bill, the users have little motivation to examine and question the costs.

Also, I am sadden to see Consumer Reports getting into political matters with a partisan bent. I would prefer they stick to evaluations and comparisons of products and services, where they have provided a valuable service for over a half a century.

This healthcare "report" strikes me as not a considered evaluation with a systemic overview, but rather an exercise in CR's and their readers political biases.

6 Posted by Wade at 06/17/09 09:55 PM

I enjoy consumer reports because it usually provides an unbiased review of products. I was very surprised and dissapointed to see the apparent leading position they have taken in the so called health care reform issue. The position they have taken appears very biased and politically motivated. If they contine to push such positions I will discontinue my membership. I do not wish for any portion of my subscription money to be used to promote political positions that I cannot support.

7 Posted by Jesse Barr at 06/29/09 09:26 AM

CR certainly stirred up the waters with this one! My one comment is that I have been receiving my health care from the VA for 29 years and it is excellent! The old saw that Government can't do anything efficiently is absurd. GM, Chrysler, and Ford are wonderful examples of how well private industry does the job!
Cheers,
jb

8 Posted by bdc at 07/03/09 12:49 PM

Health care reform benefits everyone. A public option is absolutely necessary. The healthier people are, the better the work force is. Less burden on employers makes fiscal sense. In the end, everyone benefits--even people who don't need the public option. Partisan talking points and "fear and smear" aren't necessary anymore. The overwhelming majority of Americans over several polls demonstrates that the public option is a mandate.

9 Posted by Peter at 07/03/09 04:28 PM

Two government programs that the government does better than the private sector

(1) pensions - Social Security is still here whereas most private pension schemes are defunct. In fact most were scams.Health Care _ VA, health care provided to the military, and Medicare are equal to the best private health insurance and superior to most private health insurance plans many of which are actually frauds.

10 Posted by DCohen at 07/03/09 07:37 PM

Imagine if our police departments, our fire departments, our parks, public works, etc. were privatized. Healthcare is a fundamental right in a civilized society and, as such, it is the responsibility of our government to see that every citizen has it. That means it should not be totally given over to a private, often profit-oriented, industry, whose primary goal is not giving proper healthcare but making money. That is our current system, and it is not working!

11 Posted by Brian at 07/06/09 10:48 AM

Wade said: "I was very surprised and dissapointed (sic) to see the apparent leading position they have taken in the so called health care reform issue. The position they have taken appears very biased and politically motivated."

There's a notable difference between "biased, politically motivated" and "position contrary to my own beliefs."

12 Posted by DM at 07/06/09 11:37 AM

I have friends who have moved from the US to countries with government run health plans. They are thrilled with the medical care they are receiving. They cannot believe how much better the medical care is in these "socialized medicine" countries than what they received under their employers health plans in the US. It is unbelievable to me that the American public keeps believing the propaganda from the insurance giants and the AMA. These people just want to keep getting rich off of the pain of the rest of us. And if you really need them 'God help you' because they will look for any excuse to drop your coverage.

13 Posted by Sanjay at 07/06/09 11:54 AM

I have physicians in my family. And I can sense their frustration about current situation limiting their ability to deliver care effectively. All the while their malpractice insurance rates go up. Youngsters do not want to enter the field of medicine because after the cost of having a practice is factored it is not worth all the hard work and debt in med school to be a doctor.

I wonder what they are going to do about this in the new plan? As far as I can tell we are moving towards a 2 tier system. Those who can wait and afford the mail to be mis-delivered go with USPS. For those who need assured delivery go with UPS or FEDEX. It is as simple as that.

-sanjay

14 Posted by PGJack at 07/06/09 12:19 PM

I see that many readers disagree with CU's findings and therefore condemn them as biased. If Cu had come to the opposite conclusion I expect those folks would assume an unbiased study.

The government must be doing a lot right, everything you do during every day is supported by government roads, police and fire protection, sewage removal, water supply, subsidized power plants, military protection, court protections of your rights, certification of physicians, FDA protection of food and drug supply, basic education, our wonderful postal service that for over 100 years has allowed us to put a letter in the blue box and have it almost invariably turn up at the right address a few days later, Hoover and Bonneville dams, the Holland tunnel, the Baseball Hall of Fame, the list could go on all day.

We the people make our government. If you don't think it works go to Somalia, they don't have one.

15 Posted by Barbara Saunders at 07/06/09 04:09 PM

I actually share some of the concerns raised by people who fear "public options." What bugs me is that I hear no solutions from this crowd. I understand that some people are happy with their current coverage. Bully for them.

However, coverage problems are not just limited to people "lazy" or "rebellious" enough not to have achieved the right kind of job or career situation. I know people who make six figures (including one of my physicians!) who find themselves unable to find coverage for their families or fighting their insurance companies for coverage they need.

What solutions do "anti-government"people propose -- not just to individuals but to small businesses that can't cover their workers, big businesses that can't compete with foreign companies due to these costs, all of we consumers who bear the higher prices caused by those problems, and so on.

16 Posted by James at 07/06/09 04:48 PM

There is a very big difference between healthcare and health insurance. The reason health insurance is "expensive" is because typical healthcare procedures are expensive. Why is everyone wasting time discussing and debating ways to reform the insurance industry? If you fix the healthcare prices, then the insurance industry will adjust itself accordingly. Right now, everyone wants to take the strategy of telling the insurance industry what it will pay for procedures and how much in profits it can make, and then hope that providers will adjust their costs accordingly. We should be doing the exact opposite.

Your article shows you're just as ignorant as the people in Washington that use healthcare and health insurance interchangeably. Getting every American health insurance coverage will do nothing to reduce costs.

17 Posted by Jack McGuire at 07/06/09 08:20 PM

I applaud you for trying to separate truth from propaganda with regard to the "public option debate.

Rationed medical care and cadres of bureaucrats standing between doctor and patient is exactly what we have now; read insurance companies!

The VA and Medicare are very successful programs; just ask anyone who is covered by them. Sure, there may be a few horror stories but not anywhere near the number from those covered by private plans.

The Congress and the President should make good on the promise that they made to the voters, who overwhelmingly support the public option. In fact, I would be surprised if the majority didn't support a single-payer system.

Remember the promise? We Americans who are happy with the healthcare insurance that we get through our employers can keep it and for those who need a little help to pay for it can get help. But those who can’t get healthcare from the private companies could get the same healthcare as those in Congress and other federal employees can get. I would ask my fellow Americans to form your opinions at least in part by understanding who would benefit from the availability of the public option, while you keep your private insurance.

Well, my friend, whom I’ll call Sandy, will. And none too soon.

My friend Sandy, a fellow San Diego resident, has suffered from bipolar illness and from a learning disability which is just bad enough that she is virtually unemployable. Thanks to her mother, she has a small trust fund which her mother thought would support her for the rest of her life. She gets $1200 per month and her healthcare expenses.

She had been covered by an individual policy for which she paid $400 or so per month. Her insurer, Cigna arbitrarily decided to cancel her policy and not offer insurance to individuals. Her pre-existing condition made it impossible to get any insurance except through the State administered high-risk pool, called MRMIP. This is NOT like Medicaid; she paid slightly less than $1000 per month. After three years on MRMIP she was qualified to purchase a post-MIPS private insurance policy from Blue Cross but the cost is $1664 every two months. About eight months ago, symptoms of her illness prompted her doctor (to whom she pays cash from her $1200 monthly income) to prescribe a stronger medicine to keep her symptoms from sending her to the hospital. The insurance company refused to cover her medication. Out of frustration and anger, and while not in the best frame of mind, she decided to drop the private insurance for which she had been paying $9984.00 for the last five years. She has paid them almost $50,000.00 in those 5 years, yet they gave her a hard time over $300 worth of emergency medication. Now, in calmer days, she has to decide whether to take a chance and “self-insure” or try to fight for reinstatement, which she may or may not get, and pay $6656.00 for the eight months she missed. What a choice!

So when you talk with the folks at the office or the shop and your (insured) associates start echoing what the lobbyists have planted about socialism and bureaucrats running medicine, don’t be fooled. This is not about socialism and lobbyists’ talking points. This is about my friend and your fellow American Sandy, doing her best to take care of herself on $1200 per month, paying for her doctor and her medicine out of her quickly dwindling resources. Can’t we give her a better choice?

18 Posted by Jerry at 07/06/09 08:55 PM

Why does everyone choose to bash the Post Office when they cite examples of bad government? I think those folks should back up these statements with facts and not hyperbole. Otherwise they should be sued for libel! Frankly I think the Post Office does a nice job and this with a much higher volume than Fed Ex or UPS.
I also find it humorous that the opponents of health care reform (apparently they like it the way it is) keep harping about "socialized medicine" and the evils of the Canadian and British systems. Even though recent research finds that again hyperbole is the basis of this criticism it remains true what is being proposed is not anything like Canada or Britain but more like Switzerland or Netherlands. Ah... but don't confuse yourself with facts but keep tossing out the same old red herrings.

19 Posted by Frederick J Uhl at 07/07/09 01:30 PM

I am one of those who have insurance from my employer. I am now retired and have a supplemental provided by my former employer. These benefits provided me were not free. During the 35 years with my employer my salary was lessened because of the benefits I would receive during my retirement. So my insurance was not free. My fear is that any public option would make my employer opt out and stop offering the insurance I paid for. I do not mind paying taxes on the benefits I use but employers should not be able to opt out of these paid for insurance.

20 Posted by kaokie at 08/27/09 05:15 PM

there is no question that there needs to be changes in health care insurance and the health care industry. most of the problems are a direct result of a lack of oversight and regulation by government committees. evidently the politicians voted to change this system of checks and balances during the Clinton administration - with little/or no fanfare - i, for one, was not aware of this. i'm sure the lobbyists must have had the opportunity to voice their opinions. ditto Fannie Mae and Freddie Mac. it appears the general population of this country needs to 'pass the hat' in order to hire lobbyists to look out for the interests of the people, because the politicians we elected to do that obviously are 'confused' as to why and how they got those 'cushy' jobs, but i digress. Medicare is 'broke' because the politicians use Medicare money to finance their current project, whatever that may be, the VA is broke because that money is used when the Medicare money isn't adequate for their purposes. after all, how would they finance their salaries, retirement plans, pension plans, private jets, 'jet set' status, dual residences (home and D.C.), 'pork' filled bills, pet projects, etc., etc., etc., and since they really have to have all these 'needful things', and as a unified entity, have no income other than 'public welfare' (they're basically parasites), where else are they going to get the money to build their empires, public and private? they are 'legends in their own minds' - members of the 'elite', as it were, so far above and removed from, the general populace, they now believe 'they' must 'take care of' the ignorant, stupid, 'sweaty masses' living so far beneath them (that's us, people), because, being so high above all of us, they certainly know what's best, and we couldn't possibly be capable of knowing what's best for ourselves.