Politics and the Public Option

October 26th, 2009

ObamaThere hasn’t been a lot of clarity in the sturm und drang over the so-called public option in current health care reform schemes.  The best discussion of the public option I’ve read is in a column by Robert J. Samuelson.

The political divide over the public option, like so much else in Washington, is defined by raw partisanship.

Most Democrats want it, some because they see it as the first step in their march toward single-payer health care.  The single payer, of course, is the government.  Inevitably, because there’s only so much money to meet health care demand, unaccountable bureaucrats who would run a single-payer system would ration health care.  That’s fine with many liberal Democrats because, as they see it, everything would be done for the greater good.

Almost all Republicans are against it, partly because Democrats want it, but mainly because they think they see it for what it is.  They believe that a public option, even if it begins in a limited way or with so-called “triggers,” will destroy the health insurance industry and emerge over time as true socialized medicine.  This violates their free market principles and, some would say, their instinct that “them that’s got” ought to always be able to get more.

The Obama Administration and the Democratic leadership in Congress have at least one very big problem with the public option.  Some Democrats who will face angry voters next year in shaky districts and states would like to keep their jobs.  So whatever their personal inclinations, they’re not eager to march over that cliff.

As Samuelson explains it, there are plenty of practical reasons for Democrats and Republicans alike to oppose the public option, at least in any form that resembles what’s now under discussion:

In the health-care debate, the “public plan” is all things to all people. For supporters, it would discipline greedy private insurers and make health-care coverage affordable. For detractors, it’s a way station on the path to a single-payer insurance system of government-run health care. In reality, the public plan, also known as the public option, is mostly an exercise in political avoidance: It pretends to control costs and improve access to quality care when it doesn’t. …

The promise of the public plan is a mirage. Its political brilliance is to use free-market rhetoric (more “choice” and “competition”) to expand government power. But why would a plan tied to Medicare control health spending, when Medicare hasn’t?…

Many would say: Whoopee! Get rid of the sinister insurers. Bring on a single-payer system. But if that’s the agenda, why not debate it directly? It’s not insurers that cause high health costs; they’re simply the middlemen. It’s the fragmented delivery system and open-ended reimbursement. Would strict regulation of doctors, hospitals and patients under a single-payer system provide control? Or would genuine competition among health plans over price and quality work better?

That’s the debate we need, but in truth, doctors, hospitals and patients don’t want to be limited, whether by government or markets. Congress reflects public opinion. Fearing a real debate, we fake it.

A public option for health insurance could be a good thing, if it’s structured and managed properly.  This might be done, for example, by a public corporation with independent authority, free of political meddling.  That may sound like pie-in-the sky, but it could make a public plan a fair competitor in the insurance market.  Its premiums would reflect the market, and competition would play out in terms of the quality of service provided.  This could accomplish the goals of bringing prices down and improving quality.

Couldn’t Democrats and Republicans sit down together, sing Kumbaya, and work it out for the benefit of the people?  Sure, but don’t hold your breath.  Politics in the Age of Obama is and will remain bitterly partisan.  It wasn’t much better during the Clinton and Bush 43 years, but then they didn’t promise to end it, did they?


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5 Responses to “Politics and the Public Option”



  1. thepoliticrat |

    So right- but I don’t think anyone on the Republican side of the aisle is ever going to be sitting together and singing kumbaya. R’s are too angry- they’re angry we won and it must suck to feel like the country doesn’t agree with you and are moving in the other direction…they feel like they’re losing all control. The problem is, that’s when people become the most dangerous…


  2. Tom |

    True, Republicans are angry and not in much of a mood to make nice. However, they’d probably like to at least be at the table, even if there’s no singing. Democrats, however, are also angry and have been for a long time, and they’re not about to make nice, either.

    Obama promised bipartisanship and so far has failed miserably in delivering it. It’s about time for us to throw them all out and start over with a new crop, maybe with congressional term limits. There’s no chance of that happening, of course, but it’s a nice daydream.


  3. Kevin |

    Single payer is a form of health *insurance* not health *care*. The actual health care would remain private. And “them that’s got” would still be able to buy more, just as they can now.

    The only thing that single payer would really change would be to swap out insurance corporations rationing access to health care – called “Exclusions and Omissions” in your plan handbook – for a bureacracy rationing access.

    To put that choice into context… Blue Cross of Massachusetts employs more people to *ADMINISTER* coverage for 2.5 million New Englanders than are employed in all of Canada (a vastly larger geographical area!!) to *ADMINISTER* single payer coverage for 27 million Canadians. And that’s just administration costs. Benefit coverage is an entirely different cost.


  4. Tom |

    “Single-payer health care” is a term used to describe how health care would be paid for under that kind of arrangement. I doubt that anyone, including me, ever thought that it included receiving health care from bureaucrats instead of doctors.

    I’m no fan of, nor do I defend, the health insurance industry. If a reasonable public option were structured, I think it might be a good idea, or at least one worth trying.

    Just one thought: With the long waiting times for health care in Canada, and large numbers of Canadians coming into the U.S. to get health care, Canada might want to consider devoting more resources to administering and delivering health care. I suspect that proximity to the U.S. has permitted Canada to get by on the cheap.


  5. Brian |

    Kevin, how’s that working out for Canada? Last I checked, their average wait times were considerably longer than they are here, and their 5 year cancer survival rates were lower than they are here. Perhaps if the Canadians spent a bit more on administration and delivery of service, Canadians wouldn’t have to wait so long for care, and might have better cancer survival rates. In spite of the fact that they certainly spend less money than we do, they are clearly less efficient at spending what they do than we are. If a patient dies waiting on treatment or diagnosis, then from a purely economic standpoint, every penny spent on that patient was wasted. That is not efficient.

    Care to wager that there is more northbound traffic out of Windsor seeking health care in Detroit than there is southbound traffic out of Detroit seeking health care in Windsor?

    Yes, we pay more in real dollars and as a percentage of GDP than anyone in the world. And on average, we get more…lots more.


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