As the debate over health reform moves into high gear, one issue has come to the fore as the most controversial: President Barack Obama's proposal to give all Americans the option to choose a public insurance plan, operated by the federal government in direct competition with the private sector, similar to Medicare.
With polls showing this idea with public support as high as 83 percent, an organization called Conservatives for Patients' Rights is spending millions on ads to frighten Americans that this will amount to a "federal takeover" of health care.
To this, I have two responses. First: "No, it's not." And second: "Even if it were, so what?"
How is cutting private insurers down to size, reducing their power and influence, and forcing them to compete with an efficient, cost-effective public plan like Medicare a "government takeover"? It's not as though the status quo is a thriving free market that is working for health care consumers. Ninety-four percent of local insurance markets meet the Justice Department definition of a "highly concentrated market." Here in Maryland, just one insurer controls half of the market, and the top two add up to more than 70 percent. Maybe that's why insurance premiums have been rising three to four times faster than wages in recent years.
UnitedHealth Group, Maryland No. 1 for-profit insurer, got bad publicity a few years ago for trying to pay its CEO a $1 billion bonus. And then there's the insurance industry's most unpleasant means of maximizing their profits: denying, delaying, rescinding and overpricing insurance for people when they need it most. According to the study cited in the Conservatives for Patients' Rights ad, between 4 percent and 40 percent of Americans will choose to depart the overpriced, underperforming private insurance market for public insurance, which would still leave up to half of the market in private hands and give Americans more choices than we have now. Hardly a government takeover.
But let's say these for-profit insurance executives are right and they will not be able to compete with government insurance. Let me see if I understand how they see this horrible scenario playing out:
