The Public Option: "Using Free Market Rhetoric to Expand Government Power"

Washington Post columnist Robert Samuelson exposes the mendacity at heart of the government-run health insurance scheme, the so-called public option, being touted by the Obama administration and Congressional Democrats. As Samuelson explains:

The promise of the public plan is a mirage. Its political brilliance is to use free-market rhetoric (more "choice" and "competition") to expand government power. But why would a plan tied to Medicare control health spending, when Medicare hasn't? From 1970 to 2007, Medicare spending per beneficiary rose 9.2 percent annually compared to the 10.4 percent of private insurers—and the small difference partly reflects cost shifting. Congress periodically improves Medicare benefits, and there's a limit to how much squeezing reimbursement rates can check costs. Doctors and hospitals already complain that low payments limit services or discourage physicians from taking Medicare patients.

Even [public option backer Yale political scientist Jacob] Hacker concedes that without reimbursement rates close to Medicare's, the public plan would founder. If it had to "negotiate rates directly with providers"—do what private insurers do—the public plan could have "a very hard time" making inroads, he writes. Hacker opposes such weakened versions of the public plan.

By contrast, a favored public plan would probably doom today's private insurance. Although some congressional proposals limit enrollment eligibility in the public plan, pressures to liberalize would be overwhelming. Why should only some under-65 Americans enjoy lower premiums? In one study that assumed widespread eligibility, the Lewin Group estimated that 103 million people—half the number with private insurance— would switch to the public plan. Private insurance might become a specialty product.

This is very much the argument I made back in June in my column, "The Beginning of the End of Private Health Insurance."

Read and weep over the whole Samuelson column here.