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Universal Coverage, Not Terminology, Is Non-Negotiable

I can understand why people are upset that the public option appears to be in the process of being jettisoned by the Senate Finance Committee, and specifically by Senator Kent Conrad. It is fair to note that Conrad’s own lack of common sense put him in a position to trade his elective office for favorable treatment on a home loan. Conrad, an ethically challenged Senator, is not a person who should be questioning other people’s judgement. That said, the real fight isn’t about what terminology is used; it is about whether health care reform will be national, about whether consumers will have adequate protections from the insurance industry, and about whether the federal government can use its leverage to ensure that all Americans have access quality, affordable health care to all Americans.

A strong public option would do those things. HR 3200, the bill which the House will probably vote on next month, provides strong protections for consumers, tightly regulates the insurance industry in order to prevent the abuse-for-profit model which currently exists, and establishes a public option which would empower Americans to avoid a health insurane industry with mammoth ethical failings. HR 3200 is a good bill. I support it, and every progressive should support it.

That said, the real fight in the health care reform debate isn’t over whether the term "public option" is used or not. Instead, it is over whether national buying power will be leveraged to drive prices down and expand acccess to health insurance. We can use the term public option, and end up with a weak, state-based system where buying power is diluted, prices remain high, and access is shaky at best. That would be a victory of terminology, not policy.

Or we can call a non-profit option established under the health care reform a co-op–even if that means giving Kent Conrad, a Senator who cares more about enriching himself than enriching the hard-working citizens of North Dakota, a little bit of the credit. As long as the co-ops aren’t the ineffective state-based co-ops of Conrad’s dreams, this could be a victory.

If co-ops could compete over state lines, the health care reform bill would do a lot to bust the de facto monopolies insurance companies have in some states. If the Health and Human Services (HHS) Secretary negotiated prices not only for the co-ops, but also for the private plans which wished to participate in the health insurance exchange, our common buying power would be used to leverage prices downwards.

Part of the reason the United States spends more of its gross domestic product on health care than any of its industrialized competitors is that the United States is the only country where common buying power isn’t leveraged for the good of average citizens. As long as the final bill includes stringent regulations on health insurance companies, and empowers the HHS Secretary to negotiate prices for medical procedures, prescription drugs, and hospital admissions, whether the non-profit option is administered by a co-op or the federal government is basically irrelevant.

The French health care system is widely believed to be the best, most efficient system in the world. The French administer their health insurance through, you guessed it, something akin to non-profit co-ops. But the French equivalent of the HHS Secretary negotiates rates, and sets universal prices, thereby establishing equality in health insurance.

The German system, while not as efficient as the French system, also follows the model of non-profit sickness funds administering a health insurance framework set up by the national government. This model obtains universal coverage at an affordable price. The successes of the European health care systems are a big part of the reason why American industry is struggling to sell products at competitive prices.

And while non-profit sickness funds are certainly preferable to the whims of for-profit insurance companies, the insurance market can work well even with private, for-profit companies administering health insurance. According to the Commonwealth Fund,the Dutch system obtains much better results than the current United States system largely because there are a strict set of national regulations which the private insurance industry must follow. The practical effect of these regulations is to tie profit to doing the right thing instead of tying profit to doing the wrong thing (which is how the US insurance system works at the moment).

From a progressive point of view, the non-negotiable parts of health care reform aren’t the terminology which is used to describe it, but the details contained within the House bill. The non-negotiable portions of the bill are a provision added by amendment in the Energy and Commerce Committee which allows the HHS Secretary to negotiate the rates used on the federal health insurance exchange and the following provision, which would allow millions of Americans to opt in to the insurance exchange :

Section 202 (e)(3)(A):

(A) IN GENERAL- Beginning with Y3, the Commissioner may permit employers not described in paragraph (1) or (2) to be Exchange-eligible employers.

These reforms, even if they are called a co-op in the final version of the bill, would move America away from the inefficient, unfair patchwork of state-based systems which currently exist, and towards a more efficient and effective national model of health insurance. These reforms, even if the public option is titled a co-op in the final draft of the bill, would place the American system between the Dutch and German health care systems. Doing that would provide quality, affordable care to all Americans. Doing that would enhance American competitiveness in the global market place. And most importantly, doing that would save the lives of those who can’t afford to go to the doctor because of high co-pays and higher premiums.

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