Critical Condition

‘A Thinly Disguised Power Grab’

Bob Moffitt on the latest health-care “compromise”:

The more interesting element of this proposal is the creation of an “FEHBP Plan” administered by the Office of Personnel Management (OPM). OPM is the agency that runs the popular and successful Federal Employees Health Benefits Program (FEHBP) that covers members of Congress and federal workers and retirees. There are no details about any of this yet, beyond some discussion of broad concepts in the media. However, it appears that under the Senate Democrats’ compromise proposal, OPM would be given authority to contract with private, non-profit insurers( such as Blues and Kaiser ) to compete in the federally -designed health insurance exchanges that would be erected in each of the states under the Senate bill. It appears that the government would sponsor certain favored health plans to compete against the private health plans in the states. It is not clear how a restricted set of plans would add much to competition or to expand personal choice of benefits, particularly if the benefits are politically standardized.

The key question is what authority OPM would have in the negotiation of rates and benefits, and in the financing and the administration of the program. These details are crucial. If OPM were given absolute authority to set premiums and benefits, it could conceivably set premiums below the market prices, thus undercutting private health plans on an un-level playing field, leading to the kind of erosion of private health coverage that was envisioned under the “robust” public plan favored by the Left. If it sets rates and benefits on the basis of the market rates, of course, it would fail to achieve the Left’s goal of a “robust:” administered pricing system, a central rationale for the public plan in the first place. But, of course, that could change over time. The key issue in health care policy is the infrastructure of power and control; the levers of power and domination, additional staff and funding, can be always added later, especially if an artificially low priced, government-sponsored health plan (or plans) starts to run deficits.

Meanwhile, consider the existing power of OPM. Under current law, the Director of OPM has plenary authority in negotiating rates and benefits with private health plans, a vast authority repeatedly upheld by the federal courts. The OPM Director reports to only one person: The President of the United States. If the goal is for government to dominate the health insurance markets through the creation of a new “public option” – private health plans that are private in name only- the end result could be a national health insurance market literally run out of the West Wing of the White House.

NRO Staff — Members of the National Review Online editorial and operational teams are included under the umbrella “NR Staff.”


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