The “public plan” lives on, despite most claims that this central pillar of Big Labor’s agenda won’t be part of the final health-overhaul bill.
As Democrats meet behind closed doors, they’ve simply given their government-run health plan a new name. It’s now called a national health-insurance exchange, and it has the enthusiastic support of President Obama.
The president supports giving the federal government, rather than the states, the authority to set up a new “marketplace where consumers can comparison-shop for health coverage” – an Orwellian statement if ever there was one. The exchanges would be the vehicle to centralize health-insurance regulation, with Washington dictating which benefits must be covered, what insurers can charge, and how health plans must be run.
The House bill calls for the national exchange to be run by the equally Orwellian “Health Choices Administration,” thus giving vast new power for health-insurance regulation to the federal government and giving states, consumers, and businesses little or no say over the health “choices” available to them through the exchanges. The national exchange would quickly become a vehicle for price controls and excessive regulation of insurance markets — which have driven up costs and driven out competition in many states.
The exchanges seem to be one of the less onerous parts of the monstrous health-overhaul legislation, providing a vehicle to distribute federal subsidies for insurance and a place where individuals and small businesses can shop for health insurance. But it is clear that giving the federal government power over health insurance through this new regulatory mechanism would create the foundation for a government-run public plan. Speaker Pelosi gave a preview of the power that she believes will be invested in the national exchange when she said at a recent news conference that once the legislation is passed, the insurance companies “will be crying out for a public option.”
The Senate wants to allow the states to create and run the exchanges, recognizing their greater experience and expertise in regulating the health-insurance market and allowing them the flexibility to fit local needs. While many states have gone overboard in regulating their health-insurance markets, the solution is not to obliterate their role but to create more competition by allowing consumers to shop across state lines for health insurance. Economists Steve Parente and Roger Feldman of the University of Minnesota concluded that this one policy change would mean nearly 12 million more people would get health insurance — without the federal government’s spending a penny.
But that would mean allowing doctors and patients to be in charge of decisions involving health care and health coverage – a concept foreign to those writing health-reform legislation in Congress now.
Rather than “streamlining the purchase of health insurance,” as proponents claim, a new national health-insurance exchange would steamroll over private choice and patient preferences and would provide a vehicle to extend sweeping federal regulation into virtually every corner of our health sector. This would reduce choice for patients and discourage or prohibit innovation and flexibility in health-insurance offerings that today are helping many companies and families balance their health costs with other needs.
The national exchange is just one more reason to encourage Congress to stop and start over.