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public option: everything the same except cost
By Chuck Smith-Dewey
healthinsurance.org founder & ceo
August 20, 2009
Foes of health reform have turned the public option into a bogeyman. Their tactics are to stall legislation long enough for the health care industry’s misinformation campaign to erode public support for the centerpiece of health care reform.
As envisioned, a public option would compete alongside private health insurance plans. It would be funded with enrollees’ premium dollars, just like the private plans it’s designed to compete with. It would likely allow you to keep your current doctors and have the same services as a private plan, just as Medicare does for seniors now.
The difference would be the cost. Private insurance has overhead expenses of more than 30 percent. That means out of every dollar of insurance premium you pay, between 30 and 40 cents sticks to the insurance company’s pocket for administration, marketing and profit.
The existing government-run health plans – Medicare, the V.H.A. and Tricare (for active military) – operate with 3 to 4 percent overhead. That’s obviously a huge savings, and can immediately make a public plan less expensive.
That will allow the companies in the private sector to do what they do best: adapt and innovate to meet a changing marketplace. Conservatives always complain that the government can’t run anything efficiently, so if that’s true, private industry should have no problem closing that 26 percent gap, albeit with a reduced profit margin.
Right now, the private insurance industry has a rigged game. That’s why the health care industry is pouring $1.4 million of YOUR insurance premium dollars into trying to defeat a public option each and every day.
Tags: health insurance
Editor's Note: Opinions expressed on these pages are those of the individual author(s) and do not necessarily reflect the views of the management or ownership of healthinsurance.org™.
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