One of the major fights in the upcoming health care push will be
over whether the legislation should allow Americans the option of
enrolling in a newly created government-run plan. President Obama
said that the so-called public option was a way to "keep the
private sector honest" and Howard Dean, among others within the
movement, has argued that this should be the hill to die on for
progressives. "If Barack Obama's healthcare plan gets changed to
exclude a public option like Medicare, then it is not healthcare
reform," he declared in launching a new health care
grassroots effort.
But an
analysis released today by the Lewin Group, a health care
consulting firm, confirms what conservatives have argued all
along - that the creation of a public option would shift more and
more people from private health care to government health care,
thus creating a single-payer, or socialized health care system,
over a period of time.
The group considers several variations of a public option. In one
case, it would be open to everybody, including large businesses,
and in another case it would be restricted to individuals and
small firms. Either way, the results are alarming:
If as the President proposed, eligibility is limited to only
small employers, individuals and the self-employed, public plan
enrollment would reach 42.9 million people. The number of
people with private coverage would fall by 32.0 million
people....
If the public plan is opened to all employers as proposed by
Senators Clinton and Edwards, at Medicare payment levels we
estimate that about 131.2 million people would enroll in the
public plan. The number of people with private health insurance
would decline by 119.1 million people. This would be a
two-thirds reduction in the number of people with private
coverage (currently 170 million people).
If private reimbursement rates are paid to doctors and hospitals
rather than lower Medicare reimbursements, the shift to the
public plan would not be as dramatic.
However, if government uses its bargaining power to restrict
payments to doctors and hospitals as it does under Medicare,
Lewin estimates that doctors' pay will shrink by $33.1 billion in
2010 and hospitals' earnings will drop by $36 billion.
As Heritage
notes, as it is, more and more doctors are opting out of
Medicare because of the low reimbursement rates. What will happen
if 131.2 million more people start paying at the same reduced
rate?
