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Barack Obama's presidency

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Another Option for the Public Option

By Robert Parry
November 12, 2009

Since the Democrats have already agreed to water down the health-insurance public option and to set its implementation date as 2013, there might be nothing to lose – and possibly a Republican vote or two to gain – if Democrats agreed to a trigger giving insurance companies the next three years to prove they can hold down costs and meet consumer needs.

Indeed, it might make more sense to offer such a probation period followed by a trigger in exchange for a more “robust” public option that would link rates to Medicare payment schedules, rather than require separate negotiations with health-care providers.

The trigger idea would work this way: If private health insurance companies can show they can make health insurance affordable for Americans prior to 2013, without casting aside sick people who need medical treatment, then implementation of the public option would be postponed.

However, if private insurers can’t meet an aggressive target for trimming their administrative costs and holding down premiums, then the public option would take effect with the goal of achieving real savings and offering truly affordable health care to all Americans.

Also, by setting the deadline for the trigger at 2013, Americans might actually get some health-care relief in the next three years and, if private insurers fall short, then a stronger public option would have a better chance to bring the health-care crisis under control starting in 2013.

The House-approved bill already contains so many concessions to the insurance industry that if that weak version of the public option survives, the Congressional Budget Office believes it is likely to attract only six million Americans and have premiums higher than those for private insurance because more chronically ill Americans would sign up for the public plan.

By contrast, CBO predicts that private insurers would pull in 24 million new customers from the insurance exchanges because these relatively healthy Americans will opt for the lower rates in the private plans. Since some of those new customers also would qualify for government subsidies, the arrangement could prove very lucrative for the insurance industry.

But chances for even this weak public option are not considered strong in the Senate where some conservative Democrats and Independent Sen. Joe Lieberman of Connecticut are threatening to back a Republican filibuster and thus kill health-care reform if any public option is included.

While Democratic leaders have yet to get tough with these potential Democratic filibusterers, top Democrats like former President Bill Clinton seem to be leaning on progressives to grant more concessions and to sacrifice the public option altogether.

Given the endless demands on the progressives to retreat – from their favored position of a single-payer system and then from the idea of a “robust” public option – it may be a hard sell to get the progressives to surrender even more and vote for legislation that would compel Americans to buy private insurance policies and not give the people the choice of a public plan.

Also, Sen. Olympia Snowe, R-Maine, has expressed interest in voting for a health-care bill with a triggered public option if private insurers aren’t offering sufficient cost competition. However, a concern about Snowe’s idea is that it would first create an all-private insurance exchange in 2013 and put off prospects for a public option into the future.

That’s why an immediate three-year probation period for private insurers, followed by a trigger to start a strong public option in 2013, might make sense.

If the insurance industry can’t show that it is capable of cleaning up its act, then the government would step in and offer the American people a real choice for holding down medical costs.

[For more on this topic, see’s “The Incredible Shrinking Public Option.”]

Robert Parry broke many of the Iran-Contra stories in the 1980s for the Associated Press and Newsweek. His latest book, Neck Deep: The Disastrous Presidency of George W. Bush, was written with two of his sons, Sam and Nat, and can be ordered at His two previous books, Secrecy & Privilege: The Rise of the Bush Dynasty from Watergate to Iraq and Lost History: Contras, Cocaine, the Press & 'Project Truth' are also available there. Or go to

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