CMR: Chief Middle-management Resident (medipol) wrote,
CMR: Chief Middle-management Resident

Can we find compromise on the public health insurance option? Should we?

(Cross-posted at the National Physicians Alliance Blog.)

The major battle lines in the upcoming debate about health care reform will likely be drawn around the idea of creating a choice of a public health insurance plan to compete in the market with regulated insurance companies. Republicans have made it clear they will not support such a plan, and many Democrats have announced they will oppose reform that lacks this option.

Compromise is as American as motherhood, apple pie and the creation of the US Senate. Undoubtably, our political leaders will attempt to find compromise on this issue as well. While it is less important for the House (where the majority party has near total control), it will be necessary to obtain the 60 votes that may be needed in the Senate. However, the two positions appear mutually exclusive at the moment.

But I think there will be proposals that will attempt to find a middle ground. I anticipate they will be focused on the area of competition, since that is a linch-pin of modern GOP talking points. In particular, they are many places in the country with only one or two private health insurance providers, so the creation of a public health insurance plan would engender competition in those markets. (These areas also tend to be rural, which may attract the votes of Senators from important states such as Iowa and Maine.)

One approach that has been suggested for similar debates in the past is to create a public plan only for people who live in areas that lack competition among private plans. Thus, the public health insurance option would create competition and choice for those who currently don't have it.

Is this a compromise we could live with? Or should every American have the option of enrolling in a public-sponsored insurance plan, regardless of how many private options they also have?

Now, consider the alternative proposal that will be suggested to stimulate competition: allow Americans to purchase health insurance across state lines. Currently, health insurance is regulated at the state level. Some states have passed laws requiring health insurance to be quite comprehensive; other states have only minimal requirements. However, if people could choose insurance from any carrier in any state, it would create more options for everyone to choose from.

I would call this type of proposal the "UnderInsure America Act". It would lead to many more people purchasing inexpensive and, too late for them to realize, inadequate coverage.

Now, how does that first compromise look in comparison? Maybe it is something worth considering ... it would create public plans for some people, allow us to work out the details, have a model to expand to other markets as insurance companies exit, etc.

On the other hand, the public insurance plans would likely exist only in rural areas, which have a much different population than urban centers. It may be harder for those plans to build the numbers necessary to demonstrate efficiencies over private insurers.

Is this a compromise we could consider?

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