Critical Condition

A Public Plan is a Rx for Disaster

It seems that every day now there is new speculation on the fate of the public plan in the final bill that will come out of Congress. One day it’s in; next day it’s out. Despite the jockeying and uncertainty, conservatives must not let down their guard and fall back on their heels. The stakes are high. Any bill that includes a public option will forever change health care and the practice of medicine in this country. A public plan is certainly bad for insurance companies; it will drive them to extinction. But nobody has more to lose in the proposed government takeover of health care than doctors and their patients. 

Medicare reimburses physicians substantially less than private insurers. Medicare pays hospitals and doctors, respectively, 71 percent and 81 percent of private rates. For doctors seeing Medicare patients, this is often barely enough to break even. For hospitals, the Medicare payments don’t even cover the cost of seeing patients — meaning that hospitals actually lose money on Medicare patients. The sheer size of the federal government essentially transforms negotiations into “a take it or leave it” proposition that allows Medicare to get away with such stinginess. Providers would be better off negotiating with the mafia.


As more and more patients move from private insurance to the public plan, the number of patient reimbursements at these substantially reduced rates will quickly rise. Furthermore, as government market share increases in health care, so too will its ability to “negotiate” even lower rates with doctors. This will further decrease provider payments.

And the detriment to physicians will transcend dollar and cents. As reimbursements decline, doctors will have to see more and more patients to make ends meet. The time a doctor is allotted to see each patient will further decrease. Currently the average time a doctor has with a patient is about 6 minutes; it is hard to believe that the time-per-patient-visit could shrink further, but it will have to. Whatever satisfaction and contemplation remains in the profession will dwindle as doctors frantically bounce from room to room like a wayward pinball. And this should  be unwelcome news for patients, too.

Doctors are already mired in bureaucracy and red tape, forced to divert too much time and energy from the actual practice of medicine. Just getting paid these days is a David-and-Goliath task — and of all the third-party payers, Medicare is the biggest hassle to deal with. Throwing a huge, complex, and vague bill at health-care providers will only exacerbate this problem. And while members of Congress might be able to get away with not reading the bill, physicians will have to comply fully with all the minutiae or risk lawsuits.

Most doctors would agree that some reform is needed in the health-care delivery system. But why throw out the baby with the bath water? The system isn’t broken. The vast majority of Americans have coverage, and the vast majority of those rate their coverage as good or excellent. (If only Congress had such high approval ratings.) Reforms should seek to give patients real choices in a competitive private market and to give doctors more freedom to practice medicine in a manner that suits their patients.

The problem with health care these days isn’t too little government. It’s too much.

—  Jason D. Fodeman, MD is a former Health Policy Fellow at the Heritage Foundation and author of How to Destroy a Village: What the Clintons Taught a Seventeen Year Old.