Click here to view of copy of a letter signed by 30 U.S. Senators arguing for a public health insurance option in which payments to providers are negotiated — instead of set at Medicare levels — and in which physicians aren’t required to participate. The letter, dated Oct. 8, 2009, urges Senate Majority Leader Harry Reid (D-NV) to include the public option when merging two different Senate bills — one from the Senate Finance Committee, which includes health insurance co-ops instead of a public option; the other from the Senate Health, Education, Labor and Pensions Committee, which includes a public option. The letter reads:
We are concerned that — absent a competitive and continuous public insurance option — health insurance legislation will not produce nationwide access and ongoing cost containment….As it stands, the health insurance market is dominated by a handful of for-profit health insurers that are exempt from the anti-trust laws that ensure robust competition in other markets across the United States. Without a not-for-profit public insurance alternative that competes with these insurers based on premium rates and quality, insurers will have free rein to increase insurance premiums and drive up the cost of federal subsidies tied to those premiums.
I still see the public option as essentially dead. But Justin Lake of UBS makes an interesting point, arguing that the continuing battle is helping liberal Democrats distract attention from other efforts to squeeze managed care, including billions of dollars in new industry fees (already included in the SFC bill; see prior post) and more recently the threat of removing the industry’s anti-trust exemption. Lake says that the fees were “initially seen by some as something that might be dropped, or at least significantly scaled back — and maybe that still happens; but for now the fees are seen as piggy-bank money.”
I wonder if liberal Democrats had initially pushed for single payer healthcare, they would have ended up with a strong public option instead. Another lesson in the art of negotiation.