There is now some talk of finding a compromise to the public option debate by including the public option in health reform legislation—and then letting individual states “opt out” leaving their citizens without the opportunity to sign up for a less expensive public plan modeled on Medicare, and letting private insurers set the market rules in those states.
(Not long ago, the Washington Post reported that private insurers are already figuring out ways to “shun the sick,” despite health care reform. While they won’t be able to deny care because of pre-existing conditions, they can make their plans less attractive to cancer patients by including fewer oncologists in their networks.)
Let the Red States reject a public option if they choose, some say, at least the citizens of Blue States will be protected.
As Sam Stein puts it over at the Huffington Post: “For conservative Democrats — especially those from states with major private health insurance industry interests — this concession could be key, allowing them to punt a vote on a public plan to local governments. For progressives, it would not be the hardest pill to swallow.”
I disagree. I would find it a hard pill to swallow. I’m not willing to accept the notion that, if you have the misfortune to live in a state where politicians consider the insurance lobby more important than that state’s citizens—I should be willing to cut you loose and say “good luck.”
Once we allow conservative to begin to divide us, we lose the “social solidarity” that will provide the necessary base for healthcare reform. (If states can “opt out” of making an affordable, high quality public plan available to everyone, perhaps some states should also be able to “opt out” of some civil rights laws? That may seem an extreme comparison, but if you think health care is an inviolable human right, there is a parallel here.)
Once again, this is not what I thought we meant when we begin talking about universal coverage.
I also wonder whether insurers would be allowed to sell policies across state lines? If so, insurers based in red states might will skim some of the cream from the insurance pool in blue states by selling low-cost plans specifically designed for young, healthy, relatively affluent customers. Plans with relatively low premiums, high deductibles, high co-pays, and $200 annual memberships at upscale gyms could appeal to “young immortals” who rarely go to the doctor (or so they hope), and like the idea of working out and socializing at Reebok. Thus, the blue state pool becomes more expensive as it loses some of those healthy customers.
Proponents of this compromise argue that it offers a way to get the needed 60 votes in the Senate for a bill that includes a public option. Moderate will vote for it knowing that there state won’t be bound by the legislation.
But let me say it again: in the end, I don’t think we will need 60 votes to pass a reform bill.
When it comes down to it, I believe that moderate Democrats will vote with liberal Democrats to break a Republican filibuster in the Senate. Otherwise, they risk becoming forever known as one of five or six Senators who allowed Republicans to bury health care reform. If Democrats crack the filibuster, the plan then comes up for a vote.
Moderate Democrats can register their opposition by voting against the bill itself. But at that point, only 50 votes will be needed to pass the legislation. This, I think, is how 50 Senate votes will be sufficient to bring us what we have been trying to achieve for more than half a century: national health reform.
is it relevant to point out that medicaid was created as a voluntary program? — and I believe it remains one. by 1972, Arizona was still out.
history suggests carrots outperform sticks in such situations.
Maggie,
Thanks for continuing to bring morality and empathy into the health care reform discussion. They are the two values that are the bedrock of a democracy. Exposing policy decisions as moral choices is the first step to progressive reform of a broad range of issues.
In an interview with The Huffington Post today, Howard Dean worried that if given a choice, some states would show their lack of “common decency” (as he termed it) and opt-out of offering the public plan, resulting in “a lot of people who will end up suffering unfairly.” Nevertheless, Gov. Dean said he would go for an opt-out compromise if that’s what it takes to get 60 votes in the Senate. http://www.huffingtonpost.com/2009/10/08/dean-if-i-were-a-senator_n_314118.html
I sensed he felt that in the end not too many states would opt out.
If the current national debate is refocused on a few states, opting out may become too hot for local legislatures to handle, especially as the immorality of leaving people without affordable health care is driven home.
I’m sure Texas would be at the head of the line. They have tort reform already and still the worse health care in the country next to Mississippi.
What may surprise people is we already have a public option here in Utah….in workers compensation called the Workers Compensation Fund. The state set it up and funded it, got paid back and now it competes with private insurers. And Utah is the reddest state there is.
Private sector monopolies and oligarchies bind the “invisible hand”.
Regarding: “private insurers are already figuring out ways to “shun the sick,” despite health care reform. While they won’t be able to deny care because of pre-existing conditions, they can make their plans less attractive to cancer patients by including fewer oncologists in their networks.”
This begs the question of how strong the risk pool sharing and reinsurance are in the proposed reform.
The risk-sharing (reinsurance) needs to be fully able to level the playing field, across the entire insured population.
I don’t think many states would opt out, but just in case, what if the opt out were triggered? They couldn’t opt out unless the residents of the state had access to affordable, quality (minimum standards) insurance?
P.S. I now own two copies of your book. I forgot I had ordered it and so ordered another three days later. Embarrassment of riches (and forgetfulness).
The people who decry this as a compromise are completely missing the dynamic here. First, the opt-out would apply only to the Federal public option, not to the reforms as a whole.
Second, with an “opt-out,” the public option by default is available in every state exchange as a choice for consumers unless the powers-that-be take affirmative — and potentially extremely unpopular — actions to deny that more affordable choice to citizens.
With the controversy driven down to the local level, knowledge of just what the Federal public option is — merely a less expensive choice, and about as far as you can get from a “government takeover”– will increase dramatically.
As with stimulus funds (and Medicaid in the past), there will be a lot of GOP bluster, but it will dissipate as soon as a critical mass of the people, no matter how red the state, start to realize just what “opting out” will mean.
In the Blue and Purple states with roughly 80% of the population, no pol will touch “opt-out” with a 10-foot pole. It’s unlikely any of the Red ones will either — meaning (think about it for just a second) a nationally available public option. Given the hand we’ve been dealt as to the approaches available — e.g., no single-payer allowed for consideration — that is no compromise whatsoever but a plan for total victory.
Urban Legend, e-Robin, Hal,Bruce, Gary O,Jim
Urgan Legend– Yes, the opt-out applies only to the public option.
But without the public option, many people who earn too much to qualify for a subsidy are going to find mandated insurance very expensive. Probably many would wind up paying the penalty–and go without insurance.
I agree that once people understand what the public option is-and that it is less expensive than private insurance– many would object to seeing their state opt out.
BUT many very well-paid physicians and brand-name hospitals would be pushing for the state to “opt out”-
They know they can get higher reimbursements from private sector insurers (who want them in their networks and will pass the costs along in the form of higher premiums) than the public option (that has no one to pass costs on to, except taxpayers.)
This is why Mayo Clinic CEO Denis Cortese is on record opposing the public option.
Will those hospitals and physicain lobbies have more power than ordinary citizens? In some states, I’m afraid the answer is “yes.”
Texas comes to mind, along with Florida (VERY powerful physician lobbies in Florida)
And keep in mind that, in states like Florida, seniors who are on Medicare and so don’t need the public option — will back their doctors.
Affluent patients in many states may well feel that they prefer private insurance–and will identify with their doctors.
I don’t know how many states would opt out, but I don’t want to find out.
eRobin– The problem with a “trigger” is that someone has to define what counts as “affordable, quality insurance.” In some states where the insurance industry is very powerful, the industry would decide. In other states, the specialist and hospital lobbies would decide (see my reply to “urban legend”)
Hal– Very likely private insureres will never find the reinsurance adequate. Or put it this way, for them, it is simpler to just avoid sick patients.
But I agree that risk-sharing is important, and something that will have to be worked out over the next three years.
Bruce– I agree, Texas would be at the head of the line.
Interesting about worker’s comp in Utah. Utah is an interesting state in many ways . . .
Gary O–
Much as I believe that morality should always be part of the policy debate, I’m afraid I don’t trust local legislatures to respond to the immorality argument.
Also, I still don’t think we have to have 60 votes in the Seante.
I believe that, when push comes to shove, moderate Democrats will stand with liberal Democrates and vote to break a Republican filibuster. (If they don’t, 5 or 6 Democratic Senators risk gong down in history as the people who let the Republicans bury health reform. I have to think that most of them would have a hard time getting re-elected. )
After they break the filibuster, they would have a chance to register their opposition to the bill by voting against it. But at that point, only 50 votes would be needed to pass the bill.
Jim– Medicaid was never optional. Federal law requires that states offer Medicaid to “mandataory beneficiaries” . But states are not required to offer Medicaid to “optoinal beneficiaires.” (See Families USA: http://www.familiesusa.org/resources/publications/fact-sheets/minority-health-medicaid-optionals-factsheet-feb2005.html. )
An example of an optional beneficiary: an adult who does not have children. No matter how poor he is, in some states Medicaid will not cover him. Those states define the “worthy poor” as people who marry and have children.
This, of course, excludes Gays–and has been a huge problem for very poor adults suffering from AIDS.
When Medicaid was being passed, Southern states resisted the idea–they did not want to cover poor African Americans. They told LBJ that they would not vote for the Medicare/Medicaid legislation if Medicaid providers were paid as much as Medicare providers. (Most of the people on Medicare in the South would be white; relatively few African Americans lived passed 65 back in 1965.)
LBJ had no choice but to give in. Southern legislators also insisted that not all poor people should be covered under Medicaid– some should be “optional”
As Families USA points out, when “optional” beneficiaries are not covered, this hits minorities particularly hard. (See Families USA lnk above).
Given that the whole notion of making part of Medicaid “voluntary” is grounded in a legacy of racism, I doubt this is a precedent that we want to follow.
Too often “states rights” has been merely another word for racisim (in the battle over school intergration, for instance.)
OK, it seems everyone agrees:
Allowing States to Opt Out of Public Option = Bad Idea