Public Health Insurance Plan Option “Non-Negotiable”

Bill Scher

Earlier today, we at Institute for America’s Future hosted a media conference call to release the new report from Prof. Jacob Hacker, “The Case for Public Plan Choice in National Health Reform.” (Audio of the session is here) And ABC picked up on the big news:

Advocates of a government alternative to private health insurance fired the first shot of the new battle to reform the nation’s health-care system on Wednesday, saying that efforts to water down this key component of Barack Obama’s health-care plan should be rejected by members of Congress.

“In the absence of a public plan you would have to so strictly regulate [private] health plans that they would all have to become public plans,” said Rep. Pete Stark, D-Calif., chairman of the House Ways and Means Health sub-committee.

Stark spoke out on Wednesday because he is concerned that any effort to reform the private health-insurance market will prove ineffective if Americans are not offered the kind of Medicare-style government option contained in Obama’s 2008 campaign proposal.

Stark’s concerns were echoed by Health Care Now, a liberal advocacy group.

“We agree with Congressman Stark that a health care solution that does not include a public plan would be a non-starter,” said Richard Kirsch, the national campaign manager for Health Care for America Now. “President-elect Obama ran on the promise of giving consumers a choice of keeping the private insurance they have or opting in to a newly-created public insurance plan, and it is the second part of this hybrid reform that ensures we are no longer at the mercy of the private insurance industry which keeps charging us more, giving us less, and lining its own pockets with profits.”

That red line is being drawn for a reason. Insisting upon a public plan option is not ideology for ideology’s sake. It’s critical to achieve quality, affordable health care for all.

As Hacker’s report explains:

A health care system that contains costs and drives value must include a good public plan if the broad goals of reform—universal insurance and improved value—are to be achieved. Private insurance and public insurance have distinct strengths and weaknesses, and thus should be encouraged to compete side by side to attract enrollees on a level playing field that rewards plans that deliver better value and health to their enrollees. Public insurance has a better track record at reining in costs, while preserving access; it has pioneered key quality and payment innovations that have often set the standard for private plans; it is essential to set a standard against which private plans must compete to drive value and can be a source of stability for people.

Of course, the private insurance lobby is fervently against having to compete with public plans (see Ezra Klein’s interview with the lobby’s chief spokesperson), so this issue will likely be the key flashpoint in the months to come.

Which is why it is critical to understand why the public plan option is so important, so we can all defend it against the inevitable attacks. Read the report and listen to the conference call.

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