Public Plans Dominate our Health System so why the fuss over a proposed new public plan?
William Chirolas -- World News Trust
June 20, 2009 -- Many have noted that in 2007, more than 45 percent of all medical costs in the United States were paid by government, while only one-third were funded by private insurance -- but somehow this escapes our media.
In terms of number of persons covered, 80 million are covered by the government compared with approximately 160 million who are covered by private insurance. Government coverage is even larger if you include the tightly controlled private carriers' plans that insure the federal, state, and local employees. Cost to the government that is not included above, but should be, include the quarter-trillion-dollar government tax subsidy for employer-sponsored health insurance.
Of course the above does include the roughly 10 percent of claims welfare check the government pays private insurers so they can pretend they are better than Medicare (i.e., those Medicare Advantage Plans that are "private" but end up costing the government so much more than the cost of simply providing Medicare to those insurred under them).
Current "Public Plans" include Medicare for those over 65 (including paying for submitted drug claims at an average 90 percent of the cost in the Bush Medicare Part D drug benefit), Medicaid for the poor (which also covers the elderly when they are also poor), SCHIP for kids, coverage for both active military, and some veterans.
When the over 65 population has Medicare and when nearly a quarter of all children under 18 are covered by the government, it is rather late to scream that a public plan will destroy private plans. If a public plan is socialism then by 2007 we were more than half way there as private insurance only paid for $775 billion worth of health care, while the public plans paid more than a $1 trillion.
As far as destroying the Doctor patient relationship -- well, that train has left the station also, not only in terms of money spent and people covered, but also in terms of how private plans are run, with private plan payments to doctors and hospitals now based on what Medicare pays doctors and hospitals.
Could the media stop repeating GOP and AMA slogans and deal with the above facts? If it did so, perhaps we could evaluate the design of the new public plan and see if it meets the House's goal of "Innovation and delivery reform through the public health insurance option.
The public health insurance option will be empowered to implement innovative delivery reform initiatives so that it is a nimble purchaser of health care and gets more value for each health care dollar. It will expand upon the experiments put forth in Medicare and be provided the flexibility to be a leader in implementing valueâ€based purchasing, accountable care organizations, medical homes, and bundled payments. These broad authorities will ensure the public option is a leader in efficient provision of quality care, spurring competition with private plans."
Indeed if there is no public option, then what is the new thing that will hold down future cost increases? And if there is to be nothing holding down future cost increases beyond good intentions and welfare checks from the government to the medical industry so as to modernize delivery, why do any health reform? Why not just wait until we can pass the option known to work and cut costs -- the single payer health reform?
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William Chirolas brings 40 years of real-world business experience in local, state, national, and international tax, pensions, and finance to the world of blogging. A graduate of MIT, he calls the Boston area home, except when visiting kids and grandkids.