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I’ve heard some in the establishment media argue that progressives have become too fixated on the issue of a robust public option. The fight to include a public option is not a simply philosophical argument or an insider policy battle. The fight for the public option is inseparable from the fight to make health insurance affordable for middle class Americans.
During his address to Congress, President Obama effectively set a $900 billion ceiling on the size of the health care reform bill. Anything that would make the bill more expensive would need to be offset with cuts. Those cuts almost by default must come in the form of reducing the amount of subsidies/tax credits to help Americans afford insurance or the quality of the insurance.
The National Journal is reporting that the CBO determined the robust public option favored by progressives would save the government $110 billion. A weaker “level playing field” public option would only save $25 billion.
This means removing the robust public option from the House bill would require a corresponding $110 billion reduction in affordablity tax credits. Depending on the final shape of the bill that would be somewhere between a 14%-23% reduction in the amount of tax credits to working class Americans. From different CBO reports (1,2) we know that in 2019 the average tax credit for an enrollee in the exchange, who needs help with affording health insurance, will be between $5,000-$6,000. Eliminating the robust public option would reduce the amount of tax credits to an individual by roughly $1,000.
The CBO also reported that, “on average the [robust] public plan would be about 10 percent cheaper than a typical private plan.”
For a family the robust public option would be roughly $1,300 cheaper in yearly premiums. (This year the average premiums for a family coverage is $13,375)
Not having a robust public option as part of health care reform would make health care dramatically less affordable (or lower quality) for millions of Americans. It would mean denying American families a health insurance option that would be roughly $1,300 cheaper and reducing the size of the average tax credit for an individual by nearly $1,000.
Progressives are fighting hard for a strong public option because they are fighting hard for the working class. A robust public option is critical to making this current health care reform bill affordable for middle income Americans. Not having a robust public option would cost millions of American families thousands of dollars a year.
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I’m also fighting against having to pour money into insurance company profits.
That’s right, saving money is only an ideological argument that we all should just drop. /snark
It is a question of crony journalism
I want to pay the same amount for drugs that Mexico and Canada pays if we did that just how much would healthcare cost?
I want the GOP to have to argue on tv that Americans should pay more than Mexicans and Canadiens.
That’s a really good article.
This is absolutely right. There are other reasons for allowing the Public Option to pay based on Medicare rates including:
-It’s the simplest most transparent payment system
-Providers who take Medicare can be required to take the PO
-Alliance with Medicare and Medicaid increases the PO’s impact on the marketplace
-Cost saving delivery system reforms being implemented in Medicare and Medicare Advantage can quickly be transferred to the PO
-Lays the groundwork for Medicaid, Medicare, and the PO to eventually be rolled into one
-Lays the best foundation for single payer should nothing else control costs
The fact that Public Option opponents are now wavering is our opportunity to push for the strongest possible plan.
Or something like the Japanese model where you pay a rate based on the community you are in, the number of the covered in your family and your income level.
http://books.google.com/books?…..38;f=false
Thanks so much for explaining the CBO numbers-crunching. You seem to understand it better than Elmendorf who has developed a tendency to make stuff up.
The Constant Weader at http://www.RealityChex.com
I say we take the co-ops and the triggers and see what happens. There seems little choice at this point.
Co-ops and triggers and bears
Oh my!
Co-ops and triggers and bears
Oh my!
Co-ops and triggers and bears
Oh my!
Those who oppose Public Option are now losing on ALL fronts except the central argument: “My insurance company donors don’t like it.” Go ahead, Senators, take your best shot, make your case, tell the truth.
There is no other argument against Public Option now. It wins everywhere except in insurance company boardrooms and lobby shops. Time to pack it in.
Console yourselves this way, insurance bigshots: at least it isn’t single payer!
Because we all know that trigger is another word for “kill” and so do they.
Affordability is diametrically opposed to industry profits. How sad, but predictable that their lordships in the Senate are performing so poorly in legislating in the interests of their constituents.
Imagine the yelps of pain if even millionaire Congresscritters had to accept the private-insurance/unreformed insurance practices only option they want to shove down Americans throats in lieu of credible reform.
John McCain would make a considerable dent in his wife’s ready cash if he lost his lifelong, government-paid health care. With his chart, his insurance agent wouldn’t even give him the application before laughing and telling him, “No way, No insurance, Hopeless risk.”
Imagine how readily and for how many reasons insurers would rescind the contracts for John Ensign and Lindsey Graham, David Vitter and Larry Craig. How quickly would Hatch or DiFi or Lieberman get coverage other than Medicare? Their full-blown, no questions asked insurance is a right; everybody else’s is too expensive. But it would be impolite to ask why it’s too expensive or to do anything about it.
Imagine how readily and for how many reasons insurers would rescind the contracts for John Ensign and Lindsey Graham, David Vitter and Larry Craig. How quickly would Hatch or DiFi or Lieberman get coverage other than Medicare? Their full-blown, no questions asked insurance is a right; everybody else’s is too expensive. But it would be impolite to ask why it’s too expensive or to do anything about it.
Larry Craig would have been denied coverage to begin with because of his pre existing condition.
I didn’t know that stupid was a pre existing condition.
Attractive in many ways as the PO is, its adoption also stands to benefit private insurers, at least in a tentative sense. The PO initially will insure all comers,roughly 40 million currently uninsured, who are comprised of people who for reasons of high medical risk or inability to pay premiums have been precluded by private insurers.
These same people therefore represent a higher level of cost to insure and in this sense it benefits private insurers to have them covered by the PO plan, since then private insurers are left with a much lower risk and lower cost group of enrollees, and therefore higher profits.
That people would continue to choose to be covered by private insurers when the PO offers a lower cost and more comprehensive health insurance, is their business. If they are stupid enough to give a portion of their premiums to some private insurance stock holder and do so willingly, well a fool and his money is soon and definitely parted.
My Congresswoman has this to say about the PO:
“if a public option is included in the final legislation, it must be purely voluntary, self sustainable, and required to compete on a level playing field with private insurers.“
I did email her the helpful suggestion that the best way to “level the playing field” would be to hire the Russian Mafia to run the PO and mandate that they [edited by mod] and bankrupt the same percentage of their insured as the private insurers do.
[Modnote: no violence, no fantasy violence, please. thank you.]
Exactly. This is why we have to allow EVERYONE to join the public option right away if they want it.
Otherwise, if you allow only the uninsured to join, the private insurers will see to it that all of their subscribers become uninsured as soon as they become sick and elderly. The insurance companies will keep only the healthy and young, the part of the population that pays in more in premiums than it takes out in care. Essentially, the young and healthy will be paying premiums for nothing, because the insurer will drop them as soon as they try to file a claim.
No insurance system can work if current beneficiaries are the only ones paying premiums. You need healthy people to cover the expenses of the sick. If the public option is not an option for everyone, costs will rapidly outstrip subscriber premiums. Taxpayers will have to foot the bill, and private insurance will say that it told us so.
I have previously said that we could simply pay the doctors what they ask, but I think that would freak out the private insurers who like the current gimmicky system.
But, OTOH, to respond to your point, the PO could actually price like a private firm and simply put it’s “profits” back into the reserves or the federal treasury and it would still serve the purpose of being there as an option to serve the public. The idea of the option is to be there as a warning to the private insurers that if they don’t want customers they can go elsewhere.
That’s not to say I don’t favor the end of pre-existing-conditions. But, regardless of regulations the private insurers are still likely to act like private corporations. Having a public option as a last resort for people is important.
Finally, I still prefer running the PO as simply a non-profit which is indeed self-funding. Speaking of funding, remember the subsidies from Medicaid are available to any qualifying person regardless of whether they buy a private or public policy. That by itself would pump some more money into private insurers since they could at last take on (at least some of) those particular customers at a profitable rate.
Every time I see these numbers, I seethe with anger, recalling the $700 billion that Bush, Obama and Congress so willingly [and quickly, and unaccountably] poured down the TARP rathole.
And what did we get for that?
BTW, Eliot Spitzer and Paul Krugman were on Bill Maher last night. Really, really good. Maher really laid into Obama. Michael Moore was also in the first segment. I’m sure it’s available on YouTube.
The economic and healthcare problems are not unrelated. The public option is the difference between fixing the problem and throwing more money at it. Other industrialized Nations not only get better healthcare, they pay less for it.
“(Whoever sold Hoffa on ditching the public plan is no doubt talking fast and trying to explain why he is now being kicked in the face”
Really? are they kicking him in the face? do you think they’re gonna rub him out?