Public Option vs. Co-ops: Health Reform Debates Heats Up

By Joel Wendland
http://politicalaffairs.net/article/articleview/8881/

Linking the corporate-financed misinformation campaign behind the Republican's anti-health reform push to the "birther" conspiracy, Sen. Sherrod Brown, D-Ohio, encouraged the media to report the facts about health reform on a conference call with reporters Aug. 6.

Charges that health reform is socialized medicine or imposes a euthanasia program along with the fact that nearly one-third of Republicans believe the President wasn't born in this country, Sen. Brown stated, "makes me understand how important your jobs as journalist are in helping to point out the truth about" health reform.

Sen. Brown went on to express confidence that the Senate could pass a health reform bill that includes a public insurance program. He refused, however, to vow opposition to a bill without one. "I think a strong public option can pass the Senate," he said. "I won't negotiate publicly what I will support or won't support."

Brown sits on the Senate Health, Education, Labor and Pensions (HELP) Committee. In July, that committee passed a health reform bill that includes a public insurance program Brown helped to craft. "Seventy percent of the American people want a public option in the surveys I've seen," Brown indicated. "People understand that a public option will help keep the insurance companies honest."

A further indication of broad public support is that so far this month, Organizing for America, the activist group that evolved out of President Obama's campaign, has collected over 1 million signatures from voters in support of the President's health reform principles.

Four House committees passed similar health reform bills that would create a public insurance program as part of a health insurance exchange, or market, in which people seeking health insurance could choose between various plans. The public program would be designed to provide the same choices about doctors, hospitals and care that private insurers provide, but generate competition for insurance companies.

In states like Montana, for example, two insurance companies control 85 percent of the health care market, a virtual monopoly, and average family insurance premiums top $12,000, according to a recent Health and Human Services Department report. Without reigning in costs through a competitive public insurance option, another study by the Economic Policy Institute found, average family health insurance premiums in the entire country could jump 71 percent to over $22,000 within 10 years.

The public option would remedy situations where competition doesn't exist, Sen.Brown explained. It "will provide care where there isn't competition and their isn't good insurance available, and will cut costs."

A final step before a vote in the Senate can take place is passage of a health reform bill by the Senate Finance Committee chaired by Sen. Max Baucus, D-Mont. Baucus included the creation of a public insurance program in a white paper on health reform his staff published earlier this year. Since negotiations with Republicans in his committee began, however, the public insurance program has been reportedly stripped in favor of a plan that involves private cooperatives.

Democratic members of the Finance Committee see negotiations there as the best chance to craft a reform bill that can win 60 votes to avoid a likely Republican filibuster (including one or two Republican votes that may be needed to cover Sens. Robert Byrd, D-W.V., and Ted Kennedy, D-Mass., who have missed numerous votes due to illness).

The cooperative concept pales in comparison in quality, accessibility and cost control to the public insurance plan already passed by other congressional committees, said Yale economist Jacob Hacker. "Cooperatives should not be seen as a substitute for the public plan," he said. They simply won't have the muscle to control costs over time or provide a viable alternative that keeps insurance companies honest about practices and pricing. And if they cannot provide real competition they will fail, Hacker suggested.

If the Senate fails to reach a final agreement on health reform that can surpass the 60-vote filibuster threshold, Democratic leaders may opt for a little-used Senate procedure known as budget reconciliation. This procedure allows the Senate to pass a bill related to budget matters with a majority vote. President Clinton had sought to use this procedure on his health reform plan in 1993, but Senate Democrats disallowed it. This year, however, the Senate has already agreed that the procedure could be used for health reform.

The budget reconciliation procedure was created in the 1970s and has been used by President Reagan, Clinton and George W. Bush to pass controversial policies that would likely have been blocked otherwise.

About 30 Senators have signed onto a public letter circulated by Sen. Brown urging passage of a public insurance program. Earlier in the week, Majority Leader Sen. Harry Reid, D-Nev., stated that he believed the Senate could not pass a reform bill that failed to include a public insurance program.