Is the “public option” really optional?

When discussing the possibility of a “public option” as part of the health care bill being negotiated, we see great example of the power of a label.

For the public option to be an option, it has to be optional. This means that if you don't want to participate, you don’t have to. Can that be the case?

The are two financial possibilities for the public option -- either it is financially self-sufficient, or it is not.

If it is financially self-sufficient, that means it is paid solely by those who receive the benefits. In which case, it's just like any private option; you don't pay Aetna or Kaiser anything unless you sign up.

If the public option is not self-sufficient, this means by definition that non-beneficiaries -- other taxpayers -- are paying into it. In that case, we create “participants” who receive no benefits.

It's hard to imagine that the public option can be anything but the latter.

To compete on price, they need to undercut the private competition. To support this lower price, a self-sufficient public option must be more efficient than the private versions while providing the same level of benefit.

To be more available, it must accept wider range of beneficiaries than the private companies. This means it must accept more sick people -- ie, those with pre-existing conditions.

There is no evidence of government being more efficient, especially in our existing gov’t health systems: Medicare and the VA hospitals.

And by accepting more sick people, obviously their patients will be skewed toward the most expensive.

The only solution to the above is a subsidy from outside the public plan. So really, you’ll be paying into it regardless of whether you benefit. There is nothing “optional” about it. So perhaps we should start being honest in our language.

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