Thursday, March 26, 2009

Health insurance reform won't work without a public option. It's that simple.

During the campaign, Barack Obama supported roles for the insurance companies and a public health insurance option as well. Once the jockeying for position really begins in Congress, any proposed reform will be attacked by powerful, howling wolves, as well as wolves in sheep's clothing (liberals counseling caution, keeping our eyes on the big picture, etc.) The public option is sure to be attacked as unfair because, you know, government provides unfair competition to private insurers, and all that.

That's why I was surprised to see Ezra Klein in his blog at The American prospect say that Howard Dean was wrong to concentrate on preserving the public health insurance option.
According to Greg Sargent, Dean means to throw his considerable weight behind a Democracy for America campaign "to build support for the public insurance option in Congressional districts across the country." Arshad Hasan, DFA's executive director, puts it pretty starkly. “We’re drawing a policy line in the sand," he said. "We’re saying that if the public option is not included, it’s not real health care reform."

That's a bit of a weird line to draw. Dean's health reforms in Vermont did not include a public insurance option. His health reform plan in the 2004 campaign did not include a public insurance option. As a matter of policy, I should say that I strongly favor a public insurance option. But it's hardly the main determinant of real reform...
He goes on to say the public option is far from the most important issue in gegotiating a plan, and that Dean could make better use of his time. I disagree. Without a public option, healthcare reform will simply fail. We need a public option to keep not only the insurers and the politicians but also --perhaps more important -- the regulators, honest.

One reason the insurance companies are so powerful is that they are regulated by the states (be great if that changed as a result of the financial meltdown, but don't hold your breath). Back in the day, when the early 20th century Progressive reforms still lingered on, Wisconsin, as well as a few other states, had a state insurance program. I think in Wisconsin it only sold term life, and the rates were very reasonable. They weren't allowed to advertise, but word got around. Insurance companies had to compete against that as a benchmark, and regulators used it as a yardstick.

Not so coincidentally, Wisconsin at that time was widely regarded as having one of the best insurance commissions in the country. Eventually, of course, we lost the state insurance program in the deregulatory, free market mania that swept the nation. And we know where that led us.

We must keep the public option and mobilize public support for it. Without it, insurance interests and their friends and facilitators will bend health insurance reform so far out of shape it won't even be reform in any meaningful sense.

1 comment:

a2z said...

thanks for the thoughtful commentary on insurance reform. The debate on how it should be fixed has gotten so convoluted, you wonder if the policy makers are doing this on purpose if only to turn off the public interest and support.