Democrats Push Public Healthcare Option in House and Senate
Some argue there is a lack of competition in the health insurance market
In Opelika, a small city in eastern Alabama a few miles from Auburn University, manufacturing predominates. But so does something else: Blue Cross Blue Shield. About 96 percent of the people in Opelika who have health insurance get it from Blue Cross.
A similar story holds throughout the state and, it turns out, much of the United States. In the Cincinnati area, WellPoint provides coverage for more than 3 out of every 4 insured people. Nationwide, in fact, most people live in a region where only one or two insurance companies control the majority of the insurance market.
These figures, taken from data published by the American Medical Association this spring, open a fascinating window into the one of the major fights unfolding in the national healthcare reform debate. The issue came back into focus last week as lawmakers returned to Washington after the July 4 holiday.
That fight, of course, is over whether healthcare reform should include an option for Americans to buy insurance from the government. President Obama has made it a priority, arguing that a government plan would make the insurance market more competitive and help lower costs. Republicans aggressively oppose this, asserting that a public plan would all but destroy the private market.
The tension between these sides escalated further in the past two weeks as conflicting signals zipped around the city. White House Chief of Staff Rahm Emanuel last week seemed to hint that Obama might not insist on a public option in final legislation. Progressive House Democrats, alarmed, fired off a letter to Obama, who released a clarifying statement from Moscow saying he still "strongly endorsed" a public plan "to force insurance companies to compete."
If any questions remained about where Democratic leaders stood, they have been answered this week. On Tuesday, House leaders finally unveiled their healthcare bill, which, among other things, includes a public insurance plan. So does the Senate Health Committee's bill, which the committee passed by a strictly partisan vote on Wednesday morning.
To a certain degree, Obama's point about the need for greater competition in the insurance market is backed up by the AMA's data. In Cincinnati, Opelika, and hundreds of other communities across the country, the dominant insurance company has few real competitors today, thanks in part to two decades of aggressive consolidation within the industry. The private market, in other words, is no real market at all, a reality that many observers say has helped drive up healthcare costs.
But whether a government insurance plan would actually bring down those costs remains in doubt. On Wednesday, Congressional Budget Office Director Douglas Elmendorf told the Senate Health Committee that a public plan by itself would have only "a little effect" on costs.
For a public plan to really save money, Elmendorf said, Congress would have to "empower it," possibly by dictating that it pay doctors less than private plans do. That idea doesn't sit well with Republicans, who say it would not only create an uneven playing field for private insurers but also would be widely shunned by doctors and hospitals.
But "empowering" a public plan is exactly what House Democrats appear to be doing. Their bill, according to the CBO's analysis, would pay doctors only about five percent above Medicare rates and be about "10 percent cheaper than a typical private plan."
To gain bipartisan support for his bill, Senate Finance Committee Chair Max Baucus is considering replacing the public option pitched by Obama with private healthcare cooperatives, which would be regulated but not run by the government. But other Democratic leaders aren't budging. Senate Majority Leader Harry Reid has told Democrats not to go overboard trying to woo recalcitrant Republicans.
- Read more about Democrats on the defensive on healthcare.
Reader Comments
WE THE PEOPLE
Let the GOVERNMENT figure out how to pay for covering the LEGAL uninsureds and leave the rest of us ALONE. It seems mighty odd that HOR & Senate, covered by a pay all plan that cost them nothing, should be mandated to participate in the same plan they come up with for these uninsureds.
WE THE PEOPLE are the government, not the 600 or so people we elect to represent us. The majority of these elected morons have no idea what the average working person does to sustain a decent life and livelyhood and if they do, then they do not really care.
The average family, when considering all forms of taxation, already pays 30% to 50% of their income in some form of tax. Federal, State, Local, Sales, Gas, Property, Real Estate, and others are just a few of the ways we are taxed.
The majority of the uninsureds are made up of people who pay hardly any of the above mentioned forms of taxation. They do not have a job or much of a job so they pay any, or very little Federal, State, or Local taxes. The probably do not own a vehicle so they don't pay much in the form of gas taxes. They don't own property or real estate, so they don't pay these taxes.
It just seems like the majority of hard working Americans do not want to stand up and say..I had enough and I'm not going to take it anymore.
One of the main reasons we sought independence in the first place was TAXATION WITHOUT REPRESENTATION. Now we are being taxed for everything and have very poor representation and to be perfectly honest, WE THE PEOPLE put ourselves in the mess and WE THE PEOPLE are going to have to make the changes necessary to correct the mess.
total lunacy
has everyone gone crazy. by forcing businesses to do this, unemployment is going to be so much higher. small business owners are not going to be able to afford to keep extra empolyees if they have to do this. but then again what does our newly elected muslim president care about the people. he hs his health care given to him, his democrat cronies have plenty of mony to afford theirs. so if a family makes a choice to feed their family and cant pay the new "FEE" they get penalized. way to look out for the american people MR. PRESIDENT
Single payer health care system
For me it's a no brainer. As I exited my doctor's office following my recent mid-year physical, I noticed the rather large number of personnel handling administrative and clerical functions not actually assisting the doctors in providing patient medical services. Question: Actually what patient services do insurance companies actually perform for patients other than profit from processing claims. Recently learned that Wall Street grades health care insurance comnpanies on what, I believe, is called a Maximazation Ratio. A higher Ratio indicates that the insurance company has been successful in minimizing the amount of monies paid on submitted claims. Might this be a form of rationing health care? Also a higher Ratio results in higher profits, higher stock prices, higher bonuses, and greatly profitable opportunities for converting lucrative stock options. This is a system that essentially continues to increase our nation's health care costs contrasted to the lower costs enjoyed by most other highly industrialized nations. There is no way that our nation's major corporations and all our medium and small businesses can be competitive. Incidentally, citizens in nations that have a single payer system don't become bankrupt because they cannot pay their medical bills. It is my understanding that the major cause of family bankruptcys is the inability to pay major health care
charges. It seems to me that a sensible approach to health care reform for a select group of non-political broad base health care specialists, experts, etc. be appointed and charged with examining successful single payer systems of other nations, the quality, access for all, costs, etc. and develop a plan that would include the best parts of the systems examined and design a plan for the United States that would cover all our citizens at a lower cost than our current costs which does not cover all our citizens. Is this approach to difficult to consider. I think not. NOTE: Currently my wife and I are covered by Medicare Part A and B and by a corporate retirement health care plan whose premiums keep rising significantly every year.
At any rate, these are my thoughts.
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