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How many public option compromises can dance on the head of a pin?

To add a bit of context to the post below, the public option has already gone through two major sets of compromises. They were:

Separating the public option from Medicare: The Congressional Budget Office projected that pairing the public option with Medicare would save the government more than $100 billion over 10 years. Independent analysts had forecast premiums reductions of 20 to 30 percent for the public option's customers. But Republicans partnered with conservative Democrats to kill this advantage, even in the more-liberal House version of the public option.

Limiting the public option to the exchanges: This happened with somewhat less fanfare, but was similarly significant: It meant the public option would be unavailable to 90 percent of Americans. Over time, it's possible the exchanges could expand, and if they expand, it's possible that individuals will be able to choose the public option (though it's not assured -- the expansion could give employers the power to choose which insurance their employees get from the exchange). But for now, the public option will only be available to a sliver of the market.

And though that brings us up to date on the House bill, the Senate's public option was saddled with an opt-out clause for individual states. But that's not all! Senate leadership is searching around for a public option compromise that can get to 60. For those keeping count, this will be a compromise atop a compromise atop a compromise. Here are the areas being examined:

National or state? A national public option is likely to be a lot stronger than a public option that is run by individual states or triggered into individual states. So there are ongoing discussions about whether the public option will be national or broken up. This gets even trickier in the case of a trigger, as you have to answer whether the trigger calls a national public option or a state public option into existence.

Implementation. Is it available on day one? Or triggered? Can states opt in or opt out? Or do they simply offer the public option, no questions asked?

Funding: In all the public option proposals I know of, the public option is self-funding (i.e., it works off of premium payments). But some conservative Democrats aren't content with that, so they're looking to build a stronger firewall between the public option and federal funds. I don't really understand how this will work.

Governance: In theory, the public option is the "public option" because it's run by the public sector. That is to say, it's run by the government. But the problem some conservative Democrats has is that, well, it's run by the government. Kent Conrad attempted to handle this by founding co-ops. That idea didn't go very far, but now there's talk of something like a national nonprofit that would be founded to run the public option.

It's hard to say, at this point, which of these compromises will enter into the final legislation. Tom Carper, Chuck Schumer, and others are working to figure it out. But the war is being waged on increasingly narrow ground that's getting carved up in increasingly peculiar ways. I don't know if you can get 60 votes for a non-Medicare, exchange-limited, state-based, opt-in, firewalled public option, and it's hard to say whether you should prefer that to a non-Medicare, exchange-limited, national, firewalled nonprofit option. But those are the choices that will dominate the debate for the next few weeks.

By Ezra Klein  |  December 1, 2009; 6:39 PM ET
Categories:  Health Reform  
Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati   Google Buzz   Previous: Howard Dean: Health-care reform 'worthless' without the public option
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Comments

It's not clear to me that having it be a "national nonprofit" would be a problem. Essentially it would be something like the Legal Services Corporation or any number of other government-chartered corporations.

Further restricting access to the PO, OTOH, seems like a total nonstarter.

Posted by: NicholasBeaudrot | December 1, 2009 6:47 PM | Report abuse

A "national nonprofit" that incorporates some of Ron Wyden's free choice ideas would be vastly superior to the current nominally "government-run" plan. If the label is all that matters, what's wrong with jettisoning the stupid name in favor of a much better policy?

But of course that's never the way these "compromises" go. Instead it will be "give me another major concession, and in exchange I will continue to say I might consider voting for your bill."

Posted by: NS12345 | December 1, 2009 7:06 PM | Report abuse

Sign me up as someone who doesn't get why it would be a big deal to run it as a separate "national nonprofit" since thats basically just a more accurate description of what the thing being debated actually is. And actually calling it that will probalby mean it will be less restricted. I actually strongly prefer it being called a national nonprofit because I think it will give it some insulation from politicians trying to micromanage it.

Posted by: spotatl | December 2, 2009 9:22 AM | Report abuse

I read this stuff and all I see is a ratification of a system that allows profiteers who do nothing but move money and paper around to skim 20 percent of health spending for private profits that further enrich rich people. That's just theft from all of us, particular those who are sick.

Please don't expect enthusiasm.

Posted by: janinsanfran | December 2, 2009 11:32 AM | Report abuse

Non-profit vs. "government" isn't nearly as important as:

scope: if it's not national, it will not have suifficient heft and scale to be effective and will not help bring about health care system change (see below); and

link to Medicare: using medicare reimbursement systems, especially for in-patient care, is important. The provider payment rates can be higher than Medicare rates, but using the same methods and codes provides for adminsitrative simplicitly, and most importantly (and least discussed), the potential for genuine system change (moving away from volume based, fee for service to more bundled and capitated payment methods).

These are the real issues and neither the left or right talks about them intelligently which suits the hospital, device, and insurance industries just fine.

Posted by: dcinsider1 | December 2, 2009 12:07 PM | Report abuse

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