4 Myths About the Public (Medicare) Option

Regardless if you do or do not support a public option, the article quoted below is worth reading in full. For this post though focus on the words I placed in bold.

The authors of the article reveal either their lack of information or their intention to mislead the public.

Providing patient selected options for health care coverage cannot work, ever, if the options provide different levels of benefits as would be the case between a public option and exiting private health insurance, including employer plans. That is why Medigap policies are standardized. The competition is based on the efficiency of the insurance company, not the benefits offered.

Nevertheless, keep in mind that the true purpose of a public option is to eventually move everyone into Medicare. Depending on the rules for participation, that is exactly what will happen.

In controlling health care costs greater competition in insurance markets is largely irrelevant. That portion of premiums attributable insurance company profit is very small.

While it may be counterintuitive, the more competition in an area, the more pricing leverage shifts from the insurance companies to health care providers.

Ah! But that’s not true for government where there is no negotiation, but price setting.

The idea of a public option for health insurance has become increasingly politicized. Insurance companies, the pharmaceutical industry, and powerful hospital systems—all groups that profit from the status quo—are attempting to stir up fears about a plan that would actually help American families. In reality, a public option would lower costs, save American families money, and allow private insurance plans to continue to compete.

The public option also remains a popular path for reform with growing support: A recent survey shows that 2 in 3 voters support a public option. In this column, the Center for American Progress sets the record straight on what a public option would do and discusses four common misconceptions about the plan.

As noted above, more than 2 in 3 Americans support a public option, including 2 in 5 Republicans. Notably, the Kaiser Family Foundation (KFF) finds that support for a public option that competes with private insurance has also seen a steady increase in support over the past decade, up 12 percentage points since 2009. Unlike during negotiations over the Affordable Care Act (ACA), the percentage of Americans who indicate that they strongly favor a public option eclipses the total percentage of respondents who oppose the idea.

In 2009, 39 percent of Americans opposed the creation of a public option, while just 29 percent strongly supported it. Today, 40 percent of Americans strongly favor a public option, while just 27 percent oppose it. This shift toward increased support and enthusiasm for a public option suggests opposition to a plan similar to President-elect Joe Biden’s may come at a political cost.

What is a public option?

Public option proposals come in many different shapes and sizes. At its core, a public option aims to improve coverage and bring down costs through greater competition in insurance markets. Many recent reform proposals centered around a public option would make other changes—such as lowering premiums and cost sharing for more middle-class families, extending financial assistance to people in the Medicaid coverage gap, and making subsidized coverage through the individual market—available to people with employer-sponsored insurance (ESI).

For the purpose of this column, a public option refers to a reform proposal similar to that of President-elect Biden’s, a scenario modeled by the Urban Institute, and a proposal from Brookings Institution scholars. Those plans build upon the framework of the ACA and share the following key characteristics: Anyone can enroll in the public option, including people who currently have ESI.

The public option competes alongside existing private plans in the individual market. The government sets the public option’s payment rates for providers, enabling it to pass along savings to consumers.

The plan offers income-based financial assistance for premiums and cost sharing, with a no-premium option for those with incomes below the poverty level. With this framework in mind, CAP corrects four key fallacies about the public option.

Source: 4 Myths About the Public Option – Center for American Progress

One comment

  1. My Dr. has indicated that if all his patients were insured through Medicare & Medicaid (M/M) he would be out of business. He doesn’t accept new patients on M/M, only existing patients that have transitioned to it. M/M for all would only cause healthcare rationing, and a reduction in those willing to make healthcare a career.

    Liked by 1 person

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