What We Have Here Is a Failure to Communicate
I agree, as you might imagine, with Jon Cohn's reality check on the public plan. But I also think that when you're trying to decide how important the "public plan" is to the overall success of health reform, you have to clearly define what you mean by the public plan.
A public plan along the lines that Sen. Jay Rockefeller or the House's Tri-Committee Plan has laid out -- that is to say, a public plan that could partner with Medicare for more bargaining power and access to provider networks -- is, arguably, very important indeed. Nonpartisan estimates by both the Lewin Group and the Commonwealth Foundation conclude that that plan could lower premium costs by as much as 20 to 30 percent. That makes it one of the few policies under consideration that could offer an immediate and recognizable benefit to currently insured Americans. If voters wake up in five years and realize that President Obama's reforms are saving them 20 percent on their premiums -- or even 15 percent -- health reform will have been wildly successful.
On the other hand, the so-called "level playing field" public plan envisioned by Sen Chuck Schumer, among others, is not a terribly important policy. It's a good policy, all things being equal. But the savings are likely to be minimal, if they manifest at all. There's a real chance it could become a dumping ground for sicker and older patients, leading to high premiums and the perception of government inefficiency. Given a choice between this plan and, say, a strong, national health insurance exchange, I'd pick the exchange.
All of which is to say that not all public plans are created equal. A strong public plan is worth more than a weak public plan. My sense is that, in some quarters, the importance of the public plan borders on the symbolic: It is about the principle of government competition and consumer choice. I see the appeal of that view. But I think it is, at the end of the day, a bit misguided. You could probably do more mandating that private insurers spend 85 cents of every premium dollars actually paying for health care -- as California tried to do -- than instituting a weak public plan. But a strong public plan could do quite a bit.
Related: The public plan for beginners.
Photo credit: AP Photo/Jacquelyn Martin.
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