Friday, September 11, 2009

Posted this to Robert Reich's comment section here, but just as much in response to this kind of leading he's doing lately in pushing publicly and hard for the public option at the 11th hour:

Dr Reich,

I wish you'd comment on the criticisms of the public option legislation coming from people like Andrew Coates and Len Rodberg of the PNHP (Physicians for a Public Health Plan,). Here are a few examples:

“'Public option' advocates circle their wagons around two useless sentences in HR 3200"

"The 'chicken and egg' problem: Can the “public option” succeed where Prudential failed?"

Nick Skala interview [go to 4:40 for the crux of Skala's argument]
choice snippage:
Pub Op "It preserves all the systemic deficiencies that we see in the current's not a sustainable system; it won't cover everybody, and will fall apart quickly due to rising costs, like we've seen in MA, VT, OR, TN, MN..."

These folks say the public option as originally conceived of by Jacob Hacker has morphed, by way of 'pragmatic' legislative reworking, into something not at all up to the challenge of it's own hype.

According to Coates, Hacker had five essential elements in mind for his a viable "option" plan:
"(1) It had to be pre-populated with tens of millions of people;
(2) Only “option” enrollees could get subsidies (people who chose to buy insurance from insurance companies could not get subsidies);
(3) The “option” and its subsidies had to be available to all non-elderly Americans (not just the uninsured and employees of small employers);
(4) The “option” had to be given authority to use Medicare’s provider reimbursement rates (which are typically 20 percent below the rates paid by insurance companies); and
(5) The insurance industry had to offer the same minimum level of benefits the “option” had to offer."

The argument, then, is that Democrats "abandoned the first four of Hacker’s criteria and kept only the last one (the one requiring insurance companies and the 'option' to cover the same benefits)." As a result, the efficiencies of scale so key to the public plan, won't deliver. It won't work.

If this is a valid argument, what an epic disaster both political and in human terms it'll be if
(a) progressives both in and outside of government expend alot of political capital in holding the line on this individual-mandate-included thing;
(b) the public option gets signed into law, and
(c) a few years down the line, a lame failure of a program results.

As a unabashed 'slippery sloper' - albeit one who sees in concept the value of a public-private competitive friction keeping everybody on their service-providing toes - the above scenario doesn't sound like any fast track to single payer to me.

This is tough stuff for a layman to follow with any great confidence, and anyone hates risking letting the perfect be the enemy of the good on a reform so desperately important as this one (like so many others, this stuff very much 'hits me where I live').

That said, I for one find it hard to know quite how to square these PNHP-style criticisms with public option advocates who I tend to agree with and trust (such as yourself).

It'd be useful to me, and I assume many others, to hear your thoughts.


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