In the Arena

Public Opining

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The debate over health care reform remains surreal. We are now focused on President Obama’s (sort of) unchanged position on the public option and the late-blooming possibility of health care co-ops as a replacement for said option. This is a foolish diversion from the actual work of health care reform–not as foolish as the Republican “death panels” and “gummint takeover,” but debilitating all the same. Some facts:

1. The public option always was something of a sideshow. It would be available only to those buying their health insurance through the new system of  “Exchanges”–that is, health care superstores where individuals and small businesses would combine to establish the same sort of purchasing clout that major companies (like, say, Time Warner) have in dealing insurance companies.

2. The aforementioned clout would force insurance companies to clean up their act and lower their prices. In effect, the Exchanges would accomplish much of what the public option is intended to do. Smart conservatives fear that the establishment of exchanges would be the first step toward a single-payer system. They’re right. The second step would be allow companies that already offer health insurance to join the exchanges. If everyone eventually joins the exchanges, the public bargaining power against the private insurers would be near-total. (And if the government replaced the current employer based coverage with a system of progressive health insurance tax credits, you would have–voila!–a single payer system.)

3. So the exchanges are crucial to health reform. Can’t get there without them.  Also crucial: regulating the insurance companies so they have to take all comers at common rates. And: expanding health insurance coverage to as many of the 47 million uninsured as humanly possible. It would also be nice, for cost control purposes, if every doctor in the country were paid a salary rather than fees for services performed, but that’s impossible for the moment–although a good place to start would be Medicare.

4. You will notice that the public option is not listed among those elements crucial to health reform. You may also notice that I haven’t mentioned health co-ops yet. That’s because they’re even less relevant than the public option. The purpose of a co-op would be for individuals and small businesses to gather together to create market power to buy health care at the best prices…but that’s essentially what the Exchanges would do. But, you say, the co-ops would eliminate the need for profits–well, there are plenty of state Blue Cross and Blue Shield plans that are not-for-profit and they’re rife with the same problems as for-profit insurance schemes. Health co-ops, like credit unions, would be harmless, but essentially marginal to the big health reform issues.

5. Today’s noise from Pelosi, Rockefeller, Feingold et al is just that…noise. Every one of them will vote for health care reform, public option included or not. The only potential Democratic defectors come from the Blue Dog wing of the party, where the nasty demagoguery of the current debate may force some to vote against the plan for political self-preservation in heavily conservative districts. The irony here is that the elimination of the public plan–distorted by Republicans into a “government takeover”–would make it much more likely that swing-vote Democrats could vote for reform.