Public plans pressure private pricing
In the push for health care reform, the details for how a public plan would work are still a bit hazy. But one line of reasoning says the government could save billions by undercutting prices. Steve Henn reports.
Stethoscope lying on money (iStockPhoto)
More on Health, Fed. Budget/Govt. Spending
TEXT OF STORY
Bill Radke: The nonprofit group Families USA reports this morning the average family pays an extra $1,000 a year for health insurance to subsidize the uninsured. That's because doctors and hospitals charge insured patients more to make up for the care they give that doesn't get reimbursed. This report bolsters the argument of those who want to reform health care. The first big fight has already begun, as Marketplace's Steve Henn reports.
Steve Henn: Back in January, even former rivals seemed ready to work together to cover the uninsured.
Ad: Because quality affordable health care can save money and make businesses more competitive.
Drug and insurance companies, unions, and health care reformers paid for that ad.
But the time for making nice may be over. Recently, the CEO of Eli Lilly, John Lechleiter, railed against even the thought of a public health insurance plan to fill in the gaps.
John Lechleiter: I don't think that American patients would or should accommodate themselves to the long waits for care, limited options, and other forms of rationing that inevitably accompany government health care monopolies.
Lechleiter's worried that any move to offer a publicly-run insurance program could push private insurance companies out of business. How a public plan would work is still being fleshed out, but if the plan were open to all:
John Sheils: We would get about 119 million people moving from that coverage to this public plan.
That's John Sheils at the Lewin group. He says a broad government plan could act like Wal-Mart and force doctors and hospitals to lower their prices. That would save billions and undercut private insurers on cost. But is it a bad thing if people choose the government plan?
Sheils: I think physicians and hospitals will think it's a problem.
So will insurance and drug companies, all of whom would lose billions.
Karen Davenport's at the Center for American Progress. She says it's unlikely a public insurance option would completely crush the private insurance market. Just look at Germany, she says, which has a generous public plan and also healthy competition.
Karen Davenport> There is a robust private market in Germany too -- and I think we'll do as well as that or better.
Davenport says private competitors will prevent any public health plan from becoming a bureaucratic nightmare. But having a public option could help cover the uninsured and hold down costs.
In Washington, I'm Steve Henn for Marketplace
Comments
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From MI, 06/02/2009
For those of the mindset that the Free Market can and does remedy the inequities of the health care industry, it would seem that they are correct. Unfortunately, the “remedy” is “an extra $1,000 a year that the average family pays to subsidize the uninsured
From Simi Valley, CA, 05/30/2009
As Americans, we are the only nation in the industrialized world that allows it's citizens to go bankrupt due to health problems. Those of us with good coverage are not exempt. I have had cancer and could easily pass the maximum limit of my coverage, which would put me in bankruptcy very quickly. Doctors say it and the majority of citizens say it, why can't we have a publicly funded health care system? The garbage the drug and insurance companies spew about the lack of care will that will result from public programs are not experienced by users of like systems in other countries. We can have good care and reasonable prices if we take greed and the profit motive out of the equation.
From NY, 05/29/2009
Health care in every other developed economy has a public component to it, available to the general public (not just the elderly or poor). And their health outcomes, even adjusted for rates of medical problems, are much better than in the U.S. Like many other physicians, I would prefer to work within a system that enables me to provide the best care for my patients. This is more important than the potential profit I could make from keeping the system as it is. As the first commenter noted, there are many physicians and most of the public that are in support of the public plan option. In fact, the National Physicians Alliance, with over 20,000 members, supports the public plan option. And a study showed that 73% of Americans (including 68% of Republicans) support a public plan option, even when given the strongest arguments against it. I hope we can turn this reality into reform.
From Santa Cruz, CA, 05/29/2009
I am disappointed that Marketplace chooses to echo the misinformation and scare tactics of the health and drug industry at a time when informed debate is so critical. If you drill down past the corporate CEOs / spokespeople, you find many doctors and much of the public in favor of a public plan.
We in America are disadvantaged by the structure of our health care industry compared to most other industrialized countries. The corporate money incentives are obvious, but do doctors and patients really have to continue to suffer for the sake of their exorbitant profits?
From Ann Arbor, 05/28/2009
Let's see -- people pay an extra $1,000 a year in our medical expenses and insurance premiums for health care for "the uninsured". Or we might pay an extra $1,000 per year in taxes for a government-run program? Hmmmm.
I still want to hear how health care is done in countries of size similar to the U.S. -- countries like China, India, Indonesia, Paki9stan and Brazil.
From Lincoln, NE, 05/28/2009
I didn't know whether to laugh or cry after the quote from Lechleiter on the "inevitable rationing" for public health care. I'm Canadian, my wife is german, and we lived in Australia for 8 years before moving to Nebraska. Never, not once, have I ever waited for care that I needed. My family has never waited for care. My extended family, including aunts, uncles, grandparents with diabetes, cancer and heart disease have never waited to receive the care they needed.
I've never waited in Lincoln either. But I pay ALOT more. And I know people who have chosen to wait for prescriptions at University pharmacy rather than get refills they need over a weekend because of cost concerns.
Then again, I'm not an American, so I guess I'm ok with the kind of waiting I've experienced under public health care.
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