No, don't back out of it, Democrats! The public plan is frankly the best thing out there in Obama's entire health care initiative, and miles above that of all the usual subsidies-and-pay-or-play crap that usually ends up in universal health insurance plans here in the US.

A public plan is one of the best ideas out there, because it would allow us to consolidate so much bureaucracy. You could create the public plan, then merge Medicare and reformed Medicaid and SCHIP programs into it. It also helps get Americans away from reliance on employer insurance.

As for the private insurance market - pardon me if I don't give a rat's ass about whether or not the public plan weakens the private insurance market. I want what is best for American consumers of health care, and last time I checked, the US government does not exist for the purpose of promoting private insurance profits (Bush seemed to have forgotten this in the SCHIP veto battle).

What this means is that we need to include a government program in the health plan no matter how hard we have to try, including using procedural tricks, because everyone believes it would be the best program.

Everyone's reaction to the proposal shows that they all -- liberals, conservatives, Republicans, Democrats, and insurance executives -- believe that in a market competition a government run health insurance program will drive private insurers out of business. If you really believed a private program could outperform and therefore outcompete a government program, you would be unafraid of having one, since the lesson of its failure would silence its supporters once and for all.

This brings to mind Bill Kristol's famous remark back in the 1993-94 struggle to the effect that if was critical that Republicans stop HillaryCare, because if it passed it would work and if it worked it would increase the public perception that the government could do good things, to the detriment of the conservative agenda of destroying the government.

To paraphrase a famous person, "all we are saying is give government health care a chance."

I have a concern that the less healthy will migrate towards the public policy making the numbers look worse than if everyone participated.

and last time I checked, the US government does not exist for the purpose of promoting private insurance profits (Bush seemed to have forgotten this in the SCHIP veto battle).

You say that the last time you checked, the government didn't exist to promote private profits. But then in parentheses you give a report from the last time you checked, and government was promoting private profits. & I bet the other times you checked were more like that one, too.

Obama campaigned on the public plan ...

+site:barackobama.com +"the same kind of coverage that members of Congress"

... and it's the plan I want.

I continue to believe that a public option in a private sector healthcare reform is lipstick on a pig, because the public plan will invariably be saddled with all sorts of restrictions and impediments to ensure that it fails. To see this at work, just look at the Direct Student Loan program, a public option to government guaranteed private loans that continually gets gutted by lobbyist-influenced lawmakers.

The only public plan that will work is one that is simply provided to everyone as a minimum baseline of insurance, with no government money going to the insurance industry. THAT plan will become like Medicare Parts A and B, and will be insulated from attacks by lawmakers.

"Everyone's reaction to the proposal shows that they all -- liberals, conservatives, Republicans, Democrats, and insurance executives -- believe that in a market competition a government run health insurance program will drive private insurers out of business. If you really believed a private program could outperform and therefore outcompete a government program, you would be unafraid of having one, since the lesson of its failure would silence its supporters once and for all."

Precisely. Intel isn't worried the government will outcompete it in producing chips, and Ikea doesn't worry whether the government will open up a discount furniture and home decorations big box shopping concept. They don't even think for a second about the government as a potential competitor, because it's so extremely unlikely that they would be outcompeted.

The private health insurance industry, on the other hand, already KNOWS they will be outcompeted.

The negotiations over the negotiations makes me puke.

Once again, as soon as the CONS scream rape, the Dems fold their hands, even before the parties have even arrived at the orgy.

But do the Dems scream pillage when the GOP/CONS start spewing 'private markets trickle down goodness to all below them'? Hell no.

I've been a Dem all my life and (usually been proud of it), but I swear, I'll register Indy or something if they give up the public option that makes my heart beat a little quicker.

With Dem. negotiators like this, we would have never had any progressive policies enacted into law.

Perhaps naively, I read McDonough's comments as calling the Republican's bluff -- 'can you think of any other way to provide equal efficiency and accountability'. Hope that is the case.
My modest proposal for health care reform and for the auto industry is to bring the auto workers into the public pool -- increasing volume, leverage and managing the risk profile of those in the pool while reducing costs for both workers and automakers.

My sense has long been that the public insurer stood a good chance of dying once the legislative horse trading got underway, but it's surprising to hear that expressed so early.

Ezra,

My comment from October 2007:

Note that a "public option" isn't even close to being mentioned as a core principle. It seems pretty obvious that this was added as a political ploy (neutralize the left), rather than an important element of the plan.

Which is where my disappointment lies-- if you take that away there really isn't much of anything ambitious in the plan besides an individual mandate, which several Republican governors have already championed.

As many know, I don't even support a public option or single payer-- but I do respect those that put it forth as a bold solution to our health care problems.

That's the issue here-- Clinton's has offered a very detailed, complex plan that at the end of the day really doesn't offer anything ground-breaking beyond a universal mandate.

http://www.prospect.org/csnc/blogs/ezraklein_archive?month=10&year=2007&base_name=hillary_clinton_on_health_care

The public option was an excellent attempt by Edwards to make a political shift to the left by including this in his plan. Clinton and Obama followed suit. Having been through the health politics cycle a couple more times than others around here, there was really no surprise at all to see the comments now merging. Just another reminder why these plans were never "really, really good."

This back and forth hardly qualifies as "negotiating." You could read it as an omen of how impossible Senate republicans will be to work with, but that's about it.

The process is just beginning. No one yet has a plan that goes anything beyond bromides. Baucus's 100 pages leave virtually every important legislative decision for another day. Nothing happens until Obama says it does.

Well, I'm on the conservative side here, and I'll pu tit this way: there's public plans, and there's "public plans".

I'm not worried if the government wants to run a non-profit insurer to compete with private insurers and keep them honest.

What I object to is the government running a heavily subsidized plan, and forcing private insurers to compete with that.

And so far as I can tell, that's what ALL the conservatives are concerned about--a government plan that is very much NOT competing with the same rules, but rather can deny coverage in cases where private insurers can't, or is allowed to charge population-average rates but has a much-sicker-than-average population and gets the rest from taxes.

SamChevre: "What I object to is the government running a heavily subsidized plan, and forcing private insurers to compete with that."

This is an example of a false argument: since it is hard to argue about what we are actually proposing, make up a straw man and argue against that instead.

No one is talking about a public option that will cherry pick patients or any of the stuff Sam is worrying about. What everyone (Daschle, Edwards, Obama, and others) has proposed is to either open Medicare to people shopping for a plan, or to open a new program identical to Medicare available as an option for those who want it. The clear stated plan is to charge those able to pay the cost that Medicare needs get to provide them with coverage. Low income people would receive a subsidy, but they would receive similar or the same subsidy to buy private coverage.

The competitive advantage that all the conservatives are worrying about is that Medicare has significantly lower overhead than private plans; that providers have significantly lower overhead in dealing with Medicare than private plans; that Medicare has considerably more clout in negotiating with drug companies, providers, and others and has shown a willingness in the past to use that clout to reduce costs and increase effectiveness, except when forbidden to by the Republicans; and that Medicare will not try to turn a profit and will not pay its managers seven, eight, and nine figure salaries and bonuses.

In addition, Medicare subscribers have a higher rate of satisfaction with the program (excluding the Part D debacle) than the clients of any private HMO or insurance company.

And that is what the conservatives are afraid of: a public competitor that will have lower costs, higher satisfaction, and a willingness to work aggressively for better effectiveness in medical care and lower costs. Coupled with an organization collecting and revealing accurate data on effectiveness and quality in health care like Daschle's "National Health Board," this would be a nightmare for inefficient, expensive, discriminatory, and unfriendly insurers and HMO's, their stockholders, and their exorbitantly overpaid executives.

...and another thing.

If anyone doubts that private companies cannot compete with Medicare on an even field, all they have to do is look at Medicare Advantage. Medicare Advantage private providers now receive a subsidy of as high as $50 billion a year (Paul Krugman's estimate) over and above the amount that Medicare part A and B costs to take care of the their patients, and that is despite the fact that Medicare Advantage providers have found ways to cherry pick patients in many situations.

The data also shows that Medicare Advantage patients do not show any health benefits over conventional Medicare.

Private companies are less efficient than Medicare and can do no better, if as well, as health care systems. There is no reason to suppose otherwise, based on data. That is why no other developed nation has chosen to use private insurance in the US model (so called social insurance programs place controls on charges, benefits, costs, and other behaviors of insurance programs.)

And that is why private insurers, HMO's, and their cynical or ignorant Washington allies are screaming against a public insurance option -- they know they will lose, because they already know they have lost.

I recently came across your blog and have been reading along. I thought I would leave my first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.

Deborah

http://termlifeinsurance2.com

I think it is a terrific idea of bringing more competition to the market.
I find it hard to believe that a private insurer has not stepped up to offer a plan that would have some of the characteristics that Obama is proposing.
In particular, why have the not-for-profit insurers not stepped up to offer more distinctive products. Part of their tax-exempt status is due to their providing products not available in the commercial market.
Don Levit

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