Why I’m undecided about the public option

I’m a bit of a bleeding-heart liberal. Maybe it just comes with the territory of living in Seattle. But I try to keep my ears open to the ideas of competing political ideologies.

So as much as I think the health care system needs reform and as much as I align myself more with the Democrats’ priorities than the Republicans’… I’m still not sure how big a fan I am of the Dems’ leading proposal to combat the depredations of the health insurance industry, the public option.

Don’t get me wrong. I’m all for making sure as many people as possible have health insurance and that the people who need health insurance the most aren’t excluded and the health insurance system doesn’t attempt to cover only the people who won’t actually use their service, and I could be swayed to the side of the public option as the way to do that. I’m just not entirely convinced the public option is the way to go on that front – even though many countries outside the United States, especially in Europe, go even further and have nationalized health insurance completely.

The idea behind the public option is to create competition with the insurance companies (although many proposed public options in Congress would be open only to people who can’t afford insurance otherwise, making it more of a safety net than true competition) so they would have to stop raising rates to the moon lest people bolt to the public option, without artificial regulations against such things that would require enforcement and might be circumvented. Much as I like the idea, I’m not sure how insurance companies could ever compete with something backed by the government. (Even though the US Postal Service allows the likes of FedEx and UPS to exist.)

Here’s the thing: The health insurance industry currently enjoys exemption from anti-trust regulations.

That’s been mentioned a few times in this debate, but I’m not sure anyone really appreciates its significance. Capitalism and the free market may be riddled with problems, but we haven’t even tried it yet when it comes to health care. If we lifted the health insurance anti-trust exemption, which has proven itself to not be in the public interest, and made it as easy as possible to change health insurance plans, and created things such as co-ops to ensure there would be someone doing whatever we wanted done, we wouldn’t need the public option to create competition or even lift the ban on banning pre-existing conditions. Health insurance cost too much? Someone else is probably charging less. Can’t get insurance because of a pre-existing condition? Someone else will take you in. Had insurance dropped once you got sick? Someone else will cover you.

The health care/insurance reform bills circulating in Congress seem like they’re trying to take many different approaches to the same problem – creating an “exchange” to buy health insurance and ending pre-existing condition prohibitions and creating a public option, for example. There’s little recognition of the wisdom of FDR, who tried one thing to fix the Depression, and when that didn’t work, tried another. I’m not sure the Democrats need to take so many, and so many relatively radical, approaches to the health care system.

Now tell me why I’m wrong.

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