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Getting to the Real Issues in Health Care Reform

Nov. 12, 2009
New England Journal of Medicine, Vol. 361, No. 20
Paul B. Ginsburg

No issue has dominated the health care reform debate as much as whether the U.S. government should offer a health insurance plan to compete with private insurers — the so-called public option. Congress has discussed two approaches to the public option, one of which would have the public plan pay providers at rates close to Medicare rates (generally, substantially below those of private insurers). Opposition by insurers, providers, and the business community, as well as fears that such a payment structure would lead to a single-payer system, has pushed this “robust” public option off the table. Instead, both the House bill and, presumably, a final Senate bill will call for the public plan to negotiate rates with providers. There is little reason to expect that such a plan would bring much, if any, competition to the market, since anticipated enrollment levels would give the public plan less negotiating clout than private insurers boasting many more enrollees. Clearly, whatever decision is made about a public option is much less important than decisions about the level of subsidies for expanding coverage, as well as details of the regulatory reform of the individual insurance market (including enforcement of an individual mandate), reform of the delivery system, and financing of reform. [Read more]

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The Center for Studying Health System Change Ceased operation on Dec. 31, 2013.