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How, exactly, would a government health care option lead to a government health care takeover?

This is the big talking point of Republicans these days — that somehow reforms that offer a public option will lead to a government takeover of health care.

The proposed Blue Cross commercials, for example, fail to explain that Democrats are only proposing a public plan alongside existing private insurance plans. This isn’t a federal takeover, it’s just more competition.

Conservatives and commercial insurance companies should be happy about a public plan. It will offer more consumer choice. And during the debate on children’s health insurance Sen. Richard Burr said on the Senate floor that government health care is more expensive for consumers and provides less coverage than private plans. Great.

This is the chance for private insurers to pit their products directly against a government plan. Obviously, no one will want to join the big, bloated, bureaucratic, expensive government option that will require long waits. Blue Cross will look like champions next to such a plan.

But I think we all know what worries private insurers. Everyone who lives in North Carolina either has or knows someone who has Medicare. And everyone in North Carolina either has or knows someone who has Blue Cross. I’ve heard many people demand “Medicare for all.” I have yet to hear anyone rally around the slogan “Blue Cross for all.”

5 Comments


  1. Leveraged

    May 21, 2009 at 1:20 pm

    any change from the reimbursement status quo creates uncertainty for NC’s 100+ hospital head administrators. After all, these guys suffer from expansionitis, having borrowed a lot of money (floated MCC bonds) to add new wings, fancy units, scanners, etc. that have yet to be paid off by taxpayers and premium payers.

  2. Adam Linker

    May 21, 2009 at 2:12 pm

    True, although the reimbursement proposals I’ve seen would reward large systems able to achieve efficiencies. Of course, any new reimbursement scheme would also have to reign in the hospital expansionistas to limit inefficient care.

  3. […] Don’t believe the lies. A public plan is not a government takeover. Adam Linker of the N.C. Justice Center says it well: http://pulse.ncpolicywatch.org/2009/05/21/how-exactly-would-a-government-health-care-option-lead-to-… […]

  4. Steve

    May 22, 2009 at 5:51 pm

    Are you missing the fact that Medicare pays only about 70-80% of what the HMOs ay to doctors and hospitals. Do you fail to understand that the doctors and hospitals simply shift these costs to the HMOs.
    The HMOs only make about $4/customer/month in actual profit.
    They actually get a lot done for that money. It is easy to see why they are so despised, they send out monthly bills that seem to go up,up,up but, if you look carefully, their margins are actually going down. They have the unenviable job of saying “no” to people who want to spend another million of somebody else’s money to keep grandma alive for another day/week/month.
    If the doctors were willing to do this for free it would be no problem for the insurers but the doctors just won’t.
    It is an illusion to believe that some sort of “free” healthcare simply awaits “reform”, in fact many people who are getting defacto “free” healthcare now will be paying far more than they are being lead to believe.
    A massive new “ministry of health” may be just what the doctor ordered if you are a beauracrat but if you are a working guy like me and you have already watched these selfsame characters steal 15.3% of every dollar you have ever made in return for a vague and ultimately false promise of “retirement” you might have a few doubts. I have also watched as these same politicians have borrowed over 11 trillion dollars in my name and squander it and promise an additional 60 trillion dollars we don’t have as retirement funds for their fellow beauracrats.
    Now they are talking about huge tax increases and borrowing every penny any creditor will forward against the future earnings of our children…are we seeing a pattern here?
    Maybe this all works great in France (but from what I read their costs are exploding too) but I don’t think it is a good idea to kill the HMOs this week and hand that work to beauracrats. If France looks like such a winner to you why don’t you immigrate? It would be much less expensive than trying to recreate France here.

  5. Steve

    May 22, 2009 at 6:15 pm

    I guess I should take on your direct question. “why would a public plan amount to a government takeover?”
    You would be creating a situation where the regulator is also the regulated. If that doesn’t trouble you consider that the best example of “public-private competition” the folks at the hearings could come up with is the post office. The post office actually enjoys a monopoly on letter delivery which is used to subsidize it’s operation. The HMOs are already highly regulated and each state has a different set of rules, how could the states set rules for the federal plan? If the federal plan gets to set it’s own “federal” rules how would that be a fair competition?
    The HMOs are virtual piggybanks for plaintiff lawyers and attorney generals but the “public option” wouldn’t be open to lawsuits…would that be a fair competition?
    I believe that the “public option” would cut the market share of the HMOs and force them to raise their prices (ironically the government does all sorts of things that force the HMOs to raise their prices) With profit margins of $4/month /customer it won’t take much to kill the HMOs.
    You already know all that don’t you, otherwise you wouldn’t host a column on the subject.
    An airline ticket to France costs a grand, recreating French healthcare here in the US will turn us all into indentured servants.
    Maybe it would be cheaper to simply buy each person who thinks French style healthcare is the creme de la creme an airline ticket.
    Or is it your real goal to kill the HMOs? Do you feel a thrill run up your spine when senators call the HMO execs evil? I fear politicians who subpeona people just so they can yell at them and ask them “how do you sleep at night?”. I fear a government that gets joy from humiliating people….don’t you?

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