Wednesday, April 28, 2021

The Coercive Nature of the “Public Option”

The Congressional Budget Office recently released a report outlining potential design considerations for a so-called “public option for health insurance” on the exchange, an online service where individuals and small businesses can choose insurance plans. CBO said the proposal’s “effect on the total number of people without health insurance would be relatively small.” Yet advocates on the left still view it as a lynchpin of their strategy to take over the health-care sector.

As Rahm Emanuel famously opined, Democrats never want to let a serious crisis go to waste. Instead, they would use the coronavirus and their razor-thin congressional majorities to enact policies further entrenching government-run health care.

Not A Level Playing Field

As did a past report on single-payer health care, the CBO report hedges its bets on eventually constructing a government-run health plan. Discussing various design considerations, it uses the word “would” 427 times, “could” 156 times, and “if” well more than 100 times in the span of the 39-page report.

The end of the report gives a clear scenario under which the left could bias the health care system in favor of a government-run plan, in which case insurers could exit the marketplace.

The larger the [government plan’s] competitive advantages, the more difficult it would be for private insurers to remain profitable. For example, if the [government-run plan] was not required to conform with state benefit mandates or rating requirements and if it paid providers [lower] Medicare rates and required providers participating in other federal programs to join its network, private insurers would have difficulties retaining sufficient market share while keeping their premiums high enough to justify their participating in the [exchange].

Many of the Democrats’ proposals for a government-run health plan exactly follow these parameters for a scenario that will reduce or eradicate private coverage from the market.

Not An ‘Option’

To use one example, Sens. Tim Kaine, D-Virginia, and Michael Bennet, D-Colorado, recently reintroduced legislation creating a government-run health plan. While their bill resembles a similar bill they introduced in April 2019, the updated version also proposes richer Obamacare subsidies, consistent with temporary policies enacted in March’s “stimulus” legislation, that give Obamacare subsidies to households earning up to 400 percent of the poverty level income.

Democrats like to call proposals like the Bennet-Kaine plan, which allow individuals to buy into a Medicare-like insurance program, a “public option.” But the bill’s proposed additions to the Social Security Act show that the plan instead relies on brute force and coercion.

  • Section 2201(b)(1)(B) appropriates $1 billion in federal dollars to start the plan. While the CBO report admitted the start-up costs associated with a government-run plan “could be substantial,” under the Bennet-Kaine bill, individual Americans would have no “option” about spending their hard-earned taxpayer dollars on this socialist endeavor.
  • Section 2202(b) states that “the health plan shall be made available” on state exchanges, according to a timeline specified in the legislation. States do not have the “option” to decline including the government-run plan on exchanges they operate.
  • Section 2207(a) states that, with the possible exception of rural areas, the government-run plan will pay doctors and hospitals the same rates as the current Medicare program. Those doctors and hospitals will not have the “option” to negotiate better reimbursement levels from the federal government.
  • Section 2208(a) states that, beginning next year, “a health care provider may not be enrolled under the Medicare program…unless the provider is also a participating provider” under the government-run plan. Doctors and hospitals do not have the “option” to decline to participate in the government-run plan—as they could with a private insurer.
  • Section 2208(b) enforces the same restrictions, but for state Medicaid plans.
  • The act would also amend Section 1128(b) of the Social Security Act to exclude from all federal health programs anyone who “places restrictions on the individuals [they] will accept for treatment,” and applies those restrictions in a discriminatory manner against participants in the government-run health plan. In other words, medical providers do not have the “option” to treat patients in the government-run plan on a more selective basis, because the federal government will pay them less than private insurers.

The bill only allows doctors and hospitals to opt out of the government program “under exceptional circumstances where participation in the health plan threatens the provider’s ability to operate.” The lack of ability for doctors or hospitals to opt out seems doubly ironic given Bennet’s history.

While he claims to support Obamacare, Bennet previously admitted that he does not purchase health coverage from the law’s exchanges. If this purported Obamacare supporter opted out of Obamacare himself, why wouldn’t he let doctors opt out of the government-run plan?

About Power, Not Health Care

The real point of the Bennet-Kaine legislation is to expand control over the economy, particularly the health care sector. The leftist mantra that “health care is a human right” presupposes government control of health care, since (by modern logic) government must define and protect that “right.”

While Democrats didn’t include a government-run health plan in their COVID “stimulus” bill, Bennet and Kaine indicated a desire to enact their legislation via other budget legislation Congress could consider in the next two years. Don’t expect the two senators, or anyone else on the left, to let up in their efforts to expand government control over the health care system any time soon.

This post was originally published at The Federalist.