I have purposely held off on putting in my 2 cents on the House healthcare bill passed last weekend -- there has been enough noise about it. As the dust is settling, I am thinking this is a good time to weigh in.
The big elephant in the room is whether or not Public Option included in this version of the bill will achieve the essential goals of improved access and quality, and curbed expenditures. As I understand it, the Public Option is meant to make coverage available to a larger swath of the US population than who is covered today. It does so by qualifying people, particularly those too poor to afford private insurance yet too well-off to qualify for government-sponsored programs, and small business owners. It claims to have a lower overhead due to reduced emphasis on profit and lower administrative costs. It is also meant to contain costs by its ability to negotiate reimbursements at the point of care, though the legislation does not allow the government to pool its negotiating muscle across all of its subsidized healthcare programs (Medicare, Medicaid, CHIP). Therefore, the Public Option reimbursements are mandated to be no lower than Medicare and no higher than the average private payments.
So, the way I read the legislation, the downward cost pressure is still at the interface of the patient and the provider/intervention. So, how is this any different from what is happening today? I would argue that the private sector insurers are probably pretty aggressive at holding the providers' feet to the fire already, and so far they have been unable to contain costs. Additionally, if we look at Medicare, its expenditures have also been sky-rocketing, despite a strong negotiating position at the provider level. So, why would an additional government-funded mechanism, that is different from and weaker from negotiating standpoint than Medicare, succeed at this Sisyphean task?
The bill does provide the Department of Health and Human Services with the ability to develop and pilot new coverage and reimbursement schemes. So, down the road it is possible that the Public Option will provide a laboratory for how best to fix our perversely aligned incentives to promote better health and not schemes to maximize income. Some estimates by the CBO indicate that the Public Option for various reasons will enroll only 6 million people. In addition, while all providers who now accept Medicare will have the opportunity to be on the Public Option provider panels, they can also opt out. Taking into account the impending 21% proposed cut in Medicare reimbursements and the relatively small number of patients predicted to take advantage of the Public Option, why would providers not opt out aggressively, the way many have opted out of Medicaid patients? And while some of the remaining 40 million uninsured will now be covered under Medicaid and CHIP, too many will still be left in the crevasse of no healthcare coverage to fend for themselves.
So, the House bill's Public Option does not seem to me to be the answer. If it is to be administered in a straight-jacket of making sure that profits in the private sector can continue to climb and patient-consumers can still operate under the misapprehension of being entitled to every touted "advance", no matter how insignificant, Public Option is a recipe for failure. I am also not sure how much attention will be paid to the output of the nascent comparative effectiveness enterprise or what statutory or political backing there may be to follow through on these data. The bill does not go nearly far enough to ensure equity in the US. It has been diluted by pandering to its vocal opponents who, while counting and recounting what is in their own purses, are content to continue a system that has created a disposable class of citizens who cannot afford healthcare. Its passage may send a short-term political message to its opponents, but its long-term failure will be an albatross around the neck of the Democratic Party for decades to come. Not to mention the travesty of continuing to abandon millions of our friends and neighbors to the whims of the profiteering healthcare marketplace.