Friday, June 26, 2009


Why the public plan option won’t work

by Larry Geller

Obama is rallying the troops in a fake “grassroots” support effort to bolster his healthcare plan. HCAN (Health Care Action Network) has gathered members (including two from Hawaii) to DC today to push for the “public plan” option. The battle is engaged.

Certainly, many of Obama’s supporters want to back him in bringing about a new system. But many would prefer that he work to bring about a single-payer system. The majority of Americans disagree with his refusal, if one can trust the various polls.

Here is a letter that appeared in yesterday’s New York Times that succinctly describes why his plan won’t work anyway.

From the NY Times, 6/25/2009, p. A22, or click here.

Will a Public Plan Bring Better Care?

The New York Times
June 24, 2009

To the Editor:

Re “A Public Health Plan” (editorial, June 21):

A public plan option that competes with private insurers won’t fix health care. Competition in health insurance involves a race to the bottom, not the top. Insurers compete by not paying for care: by seeking out the healthy and avoiding the sick; by denying payment and shifting costs onto patients. These bad behaviors confer a decisive competitive advantage; a public plan would either emulate them — becoming a clone of private insurance — or go under.

Moreover, the savings on overhead from a public plan option are far smaller than you suggest. While it might cut insurers’ profits (which is why they hate it), that’s only 3 percent of the roughly $400 billion squandered on health bureaucracy annually.

Far more goes for armies of insurance administrators who fight over payment, and to their counterparts at hospitals and doctors’ offices — all of whom would be retained with a public plan option. In contrast, a single-payer reform would radically simplify the payment system and redirect the vast savings to care.

Steffie Woolhandler
Cambridge, Mass., June 21, 2009

The writer, an associate professor of medicine at Harvard, is a primary care doctor.

Reproduced for educational purposes without profit in accordance with Title 17 U.S.C. Section 107. Correspondence may be sent to larry –a t – disappearednews0com.


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