Accidentally making the case for the public option
Today’s Lincoln Journal Star contains an editorial criticizing Harry Reid’s decision to move forward on a Senate healthcare bill with an opt-out public option. Aside from a puzzling analogy (the board claims an opt-out “would be akin to consciously deciding to stuff E. coli into the sausage links”), the editorial also relies on some contradictory logic.
While some of the board’s opposition comes from broader complaints about a public option in general, much of the criticism stems from what they call a potential “patchwork system” — they are concerned with problems that could arise from a scenario in which some states are participating in the public option and others aren’t.
“Opt-out decisions from Arizona and Texas alone would remove more than 30 million people from the public system,” the board argues.¹ “Would people with serious medical problems be tempted to move from opt-out states to those that offer the public option?” they ask.
Nevermind that they are simultaneously arguing against a public option while also acknowledging its necessity for people with “serious medical problems” — the editorial’s whole argument against the opt-out is a setup for the board to proclaim the superiority of a “trigger” system, favored by Olympia Snowe and Ben Nelson, which the LJS also endorsed in a July editorial.
For those unfamiliar with Snowe’s trigger, you can find it on page 207 of the Senate Finance Committee’s amendments (PDF):
This amendment establishes a non-profit government corporation through which a ―safety net plan would be provided in any state in which affordable coverage was not available in the Exchange to at least 95% of state residents. An individual would be deemed to have affordable access if either of two conditions is met. First, two or more plans are offered with premiums – the cost of which does not exceed a specified percentage of the individual‘s adjusted gross income (AGI), after deducting any available tax credit or employer subsidy from the cost of such premium. The percentage contribution shall range from 3 percent of AGI at 133 percent of the Federal Poverty Level, to 13 percent at 300 percent and above.Assessment of affordability shall follow submission of plan premiums filed one year in advance of the first day of each policy year, and should a state be found to not meet the 95% threshold, plans would be permitted to submit of any revised premium filings, after which a second assessment of affordability shall be performed. If, after that second assessment, a state still be deemed as not meeting the affordability standard, the safety net plan shall be offered within that state, and shall be available at the pending open season enrollment.
In other words, Snowe’s trigger would create a “patchwork system” in which some states had a public option, some didn’t, and tens of millions of people would be denied access to its benefits.
The only difference between Snowe’s trigger and the opt-out clause would be that a trigger makes people suffer under the current broken system for several more years before providing them with relief. That is, if you’re willing to assume that the trigger would ever be pulled.
In the July editorial that the board refers to, they claim one need only look to Medicare Advantage to see an example of triggers done right. “The trigger has not gone into effect because competition among private companies has remained sufficient,” they say.
Medicare Advantage actually quite clearly demonstrates how wasteful and inefficient a program can be without activating the trigger. Medicare Advantage payments have skyrocketed since 2004. A 2008 study (PDF) from Austin Frakt, Steve Pizer and Roger Feldman shows that for each additional dollar spent on Medicare Advantage plans by taxpayers, only $0.14 went to beneficiaries. The other $0.86 per taxpayer dollar went straight to the insurance companies.
This is the type of efficiency they want to emulate.
Trigger advocates know that a public option is superior — that assumption is at the core of their argument. Advocating triggers relies on confidence that a government option would do a better job of delivering quality, affordable care; it’s what we would turn to in the event that private insurance continues to fail Americans. Yet they insist on withholding it, and the only ones who benefit are private insurers.
So put into more straightforward terms, arguing for triggers is an argument to consciously withhold superior healthcare from Americans so that private insurance companies can continue to skim money off the top of our premiums for quality that will range from inferior at worst to roughly equivalent at best.
Opponents can’t have it both ways. If you don’t believe a public option would provide superior care at a lower cost, you don’t use it as the problem solver in the event of private insurance failure. If you believe a public option would provide superior care at lower cost, it’s inhumane to withhold it.
And so it’s easy to see why nobody but committed public option opponents is impressed by a trigger. The logic behind it just doesn’t hold up.
¹The LJS editorial suggests that if Arizona and Texas opt out of the public option, that would result in more than 30 million people being removed from the system. For this to be true, every citizen of those two states would have to be enrolled. This would not be the case for several reasons. The public option would only be available on the exchanges, which would only be available to a relatively small part of the population (those currently uninsured, self-employed individuals and very small businesses). And even then, the public option is just one of many to choose from on the exchanges. No one expects everyone on the exchange to choose the public option. The CBO estimates that only 6 million people would choose the House version, and even in its present negotiated-rates form, it is considered the stronger of the two.
None of the bills, including the Senate opt-out version, would require everyone to enroll in the public option.
