Unraveling the Public Option

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While President Obama is focused on a health care reform bill that ensures choice and competition, the President has stopped short of saying whether overhauling the nations healthcare system would include a so called public plan. However, reports indicate that the administration is involved in talks with Democratic lawmakers to push for passage of a public option.

On tomorrow, the Senate Finance Committee will vote on its sweeping health care reform bill while Senate Majority Leader Harry Reid will work to merge two Senate bills together. One bill was created in July by the Senate Committee on Health, Education, Labor, and Pensions and includes two fundamental provisions that the finance committee legislation does not.

Presumably, the finance committee legislation will include a government run insurance plan that Reid and other liberal Democrats like House Speaker Nancy Pelosi have backed. However, the question over whether he will push for a government-run insurance plan in the final legislation remains to be seen. Meanwhile, the Senate committee is waiting on a report on cost projections from the Congressional Budget Office before it votes on the legislation and last week voted to strike two amendments that would establish a so-called public option to compete with private insurance coverage, according to reports.

During the debate on health reform, the public option has been positively posited as a means of keeping private insurers honest, thus ensuring fair and affordable prices for all Americans. On the other hand, opponents claim a public option would not allow for fair competition, putting private insurers out of business and ensuring a government takeover. But with all the talk about a public option, National Opinion Research Center (NORC) Senior Fellow Jon Gabel said, its unfortunate that the public option has gained so much attention since the percentage [of the population] that could enroll in the public plan is only 5%.

The uproar for and against the public plan is undermining what really matters and thats changing the market, Gabel pointed out. Questions raised by the public option include, Who will administer the public plan. If it is like Medicare, then private insurance companies willeven the public option will have a blend of the public and private, he said.

It hits a raw, ideological nerve on the left and the right, [but]its a secondary issue rather than a primary [one], Gabel maintains. The public option would be most useful, as an alternative, in those states where there are one or two insurersdominat[ing] the market, he continued. The most important objective of this legislation is to control [healthcare] costs, Gabel said, which according to the latest data, are constantly going up. For example, family health premiums rose 5% over the past year to an annual cost of $13,375, according to the Employer Health Benefit 2009 Annual Survey. The survey results, released by the Kaiser Family Foundation (KFF) and the Health Research & Educational Trust (HRET) also revealed a more than 131% increase in premiums since 1999. Since 1998, most Americans have felt and continue to feel that the government is not spending enough money on health care, said Tom W. Smith, Director of the General Social Survey (GSS).

People come out and say it [reform] will cost $1 trillion, Smith said. [Its] the sheer enormity of the number thatsscaring some people away. Congress needs to get the interim plans down to the plan with six to eight points people can grasp, he continued. Now, there is just too much uncertainty.

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