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Public Option May Still Be Included in Senate Bill

From Fox News: (emphasis added)

Senior Senate Democrats at work with White House officials on health care legislation are strongly considering a requirement for the federal government to sell insurance in direct competition with private industry, officials said Thursday, with individual states permitted to drop out of the system.

Liberals in Congress long have viewed such an approach, called a public option, as an essential ingredient of the effort to overhaul the nation's health care system, and President Barack Obama has said frequently he favors it. But he has also made clear it is not essential to the legislation he seeks, a gesture to Democratic moderates who have opposed it.

This is entirely about a public "option" whereby the government directly provides health insurance in some capacity. Obama's long-term vision for the eventual establishment of a single-payer system is predicated on the destruction of the private insurance industry. This can happen rather quickly once a public health insurance plan is in place.

The President has claimed that government-run health insurance could be financed through taxes on employer-based health care benefits. But more devastating is the fact that the vast majority of Americans face drastic tax increases on the premiums they buy directly from insurers. Dick Morris expounds on the Baucus bill:

The Baucus healthcare bill provides for a tax on "gold-plated" health insurance policies. But, as with the Alternative Minimum Tax, once slated to be imposed only on the wealthy, inflation will make most Americans liable to pay the 40 percent tax in a few years.

The tax applies to all individual policies with premiums above $8,750 and families of four whose premiums exceed $23,000. But the Congressional Budget Office estimates that the average health insurance premium for families of four will reach $25,000 by 2018. The average premium should pass the thresholds in Baucus's bill by 2016.

So, a few years after the bill takes effect in 2013, the health insurance premium tax will become virtually universal. And this tax is to be a 40 percent levy. So, in six years, the average family health insurance policy, now projected to cost $25,000, will, in fact, cost $35,000 due to the Obama-Baucus tax.

Steep taxes on premiums will be devastating to the private insurance industry. Not only will Americans be unable to afford such ridiculous costs for health insurance, the public option provides some serious temptation for millions of Americans to simply drop their coverage as they will know they can always join the government plan should they become sick.

Even more insidious are the forthcoming requirements that private insurers must accept all applicants, regardless of pre-existing conditions just like the government plan. Again, countless people are bound to simply wait to buy health insurance until they genuinely need it. After all, it will be far less expensive to simply pay the penalty for non-compliance than to pay what will be substantially higher premiums and the added taxes. Thus the private insurance companies will face the same payouts, but will take in far fewer premiums. They will clearly fail.

It does not appear the public option will be included in the current wave of "reform", but I strongly fear we will end up with "triggers" that set a government-run system in motion if the private insurance companies do not meet certain benchmarks. If insurers are forced to take on pre-existing conditions, then it will only be a matter of time before the triggers are pulled.


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Comments (20)

So, they make the insurance... (Below threshold)
serpent:

So, they make the insurance business as difficult and unprofitable as possible via over regulation and idiotic government oversight. Then, when the business inevitably falls apart they declare the 'free market' a failure and step in to save the day. Sounds familiar.

If we are stupid enough to let this keep happening then we deserve what they are doing to us.

The battle over healthcare ... (Below threshold)
bobdog:

The battle over healthcare "reform" is being waged on two fronts.

As far as the American public is concerned, there's a clear consensus and the votes are in: we don't want it.

The other battle is in Congress, with hard-line Democrats scheming to find a way to cram their liberal dream through over the objections of Republicans and the public both. They're determined to save us from ourselves whether we like it or not, and it's more about the abuse of political power than healthcare.

What's going on right now in Congress is a convoluted, bloody game of Twister, and it's not pretty. Obama's still acting like all he needs to do is deliver The Speech(tm) and he can not only convince the public to support the nationalization of the healthcare insurance industry but somehow rescue his own presidency.

Neither one is likely.

"1. Posted by serpent | Oct... (Below threshold)
Les Nessman:

"1. Posted by serpent | October 23, 2009 5:37 AM "

100% spot on.

Whenever a politician/socialist starts yapping about how 'terrible' our healthcare system is, we need to get 'in their face' with what serpent posted.
We have to 'punch back twice as hard' and say "Enough! You govt f*cks are one of the biggest problems with healthcare today. Quit intruding where you don't belong."

The members of the House an... (Below threshold)
JC Hammer:

The members of the House and the Senate who are opposed to a government-run health insurance program should therefore be opposed to Medicare. After all, it's the granddaddy of public options. Yet the ones who are eligible for Medicare have all signed up for it, including Senate Minority Leader Mitch McConnell (R-KY), Sen. Chuck Grassley (R-IA), Sen. Jon Kyl (R-AZ), Sen. John McCain (R-AZ), Sen. Orin Hatch (R-UT), Sen. Richard Shelby (R-AL), Sen. James Inhofe (R-OK), Sen. Mike Enzi (R-WY), Rep. Virginia Foxx (R-NC), and Rep. Peter King (R-NY).

These people who are so all-fired against any form of public option can either be true to their convictions or drop their Medicare coverage, or they can shut the hell up and give the rest of us what they're so happy to have for themselves.

"These people who are so al... (Below threshold)
Les Nessman:

"These people who are so all-fired against any form of public option can either be true to their convictions or drop their Medicare coverage, or they can shut the hell up and give the rest of us what they're so happy to have for themselves."

What bullshit.

'Happy to have'? Liar. Forced to have, under penalty of law, an unsustainable program whos tax costs are exploding.

Guys, your notion that Obam... (Below threshold)
jim x:

Guys, your notion that Obama wants to destroy the health insurance industry is **fantasy**.

Health insurance companies still exist and do quite well in all the countries with healthcare systems conservatives might term "socialist". This includes Canada, Britain, Germany, Australia and others.

I'm just telling you.

jim x:"Health insurance com... (Below threshold)
Les Nessman:

jim x:"Health insurance companies still exist and do quite well in all the countries with healthcare systems conservatives might term "socialist". "

No kidding. They exist to service people wealthy enough to afford additional private insurance to address the poor service from socialized medicine.

So what's the point of going to govt healthcare in the first place?

Alan wrote: "Again, countle... (Below threshold)
pa:

Alan wrote: "Again, countless people are bound to simply wait to buy health insurance until they genuinely need it. After all, it will be far less expensive to simply pay the penalty for non-compliance than to pay what will be substantially higher premiums and the added taxes."

That's why the legislation being discussed includes JAIL TIME for people who don't buy health insurance. See the Legal Insurrection blog by William Jacobsen for more info about this proposed new crime:
http://tinyurl.com/y8mf297
"The tax on those who do not purchase acceptable health insurance is not a revenue device, it is a means of coercion. So if the tax is not sufficiently coercive, then jail is the next option."

See? Nothing to worry about! People WILL buy insurance whether they want it or not, just as soon as they find out they will go to jail if they don't!

I am sure this is exactly what the Founding Fathers had in mind for us. Not.

"No kidding. They exist to ... (Below threshold)
jim x:

"No kidding. They exist to service people wealthy enough to afford additional private insurance to address the poor service from socialized medicine.

So what's the point of going to govt healthcare in the first place?"

So the poor and the middle class can get healthcare. Which for the middle class and poor in in these other alleged socialist nightmare hellhole countries, is twice as good for half as much.

"So the poor and the middle... (Below threshold)
Les Nessman:

"So the poor and the middle class can get healthcare."

The poor and middle class already get healthcare here. Why take a system that works pretty well and dramatically involve more costly govt into it?

Why not improve a (mostly) private system and instead get the govt involved in the most intimate details of our lives?

jimx apparently believes th... (Below threshold)
bobdog:

jimx apparently believes that this bill will not destroy the insurance industry.

What a quaint idea.

And what happens if people ... (Below threshold)
GarandFan:

And what happens if people not only refuse to buy insurance, but also refuse to pay the penalty?

"The poor and middle class ... (Below threshold)
jim x:

"The poor and middle class already get healthcare here. Why take a system that works pretty well and dramatically involve more costly govt into it?"

Where exactly is that? That 'here' you're referring to isn't in America.

The poor can get **emergency** health care in this country - if they lie about their names. They can't get dependable care for chronic conditions, and many die because of it.

The middle class can get care **IF** they've been able to keep paying insurance costs which are rising twice the rate of inflation, and **IF** they have no pre-existing conditions, and **IF** the care they need isn't so costly that the insurance company will just cut them.

Otherwise they better have a house they can afford to sell in order to stay alive.

Garandfan, I don't approve ... (Below threshold)
jim x:

Garandfan, I don't approve of mandating health insurance at all. That's one part of the bill I hope is taken out.

But if it's in there and people refuse to pay or buy the fine, then they'll have the same health care many people have today anyway - hoping they don't need it, and going to the emergency room and lying about their.

Which absolutely sucks, but it is no worse than what we have right now anyway.

"jimx apparently believes t... (Below threshold)
jim x:

"jimx apparently believes this bill will not destroy the insurance industry."

Yes bobdog - because the insurance industry's of country's with far more "socialist" health care are all doing just fine.

Believing things because of evidence? How quaint.

" Which absolutely sucks, b... (Below threshold)
Les Nessman:

" Which absolutely sucks, but it is no worse than what we have right now anyway. "

What a ringing endorsement for govt care. All the suck plus enormous govt control of its citizens too.

No "Les Nessman", my quote ... (Below threshold)
jim x:

No "Les Nessman", my quote is referring to how people who **refuse** to buy insurance in the future will have the same difficulties to deal with as those who **refuse** to have insurance now.

That's the same "suck" that I'm referring to. As opposed to much larger numbers of the poor and middle class who will be able to afford and purchase insurance, under a public-option healthcare system.

Since this means those who want to purchase private insurance can still do so, this doesn't fly as "government control" either. FYI.

jim x - "So what's the ... (Below threshold)
Marc:

jim x - "So what's the point of going to govt healthcare in the first place?"

Um, ask the Canadians. Slowly they are going the opposite way.
And with the new gov in Germany you'll see the same switch away from single payer also.

jim x - "Since this mea... (Below threshold)
Marc:

jim x - "Since this means those who want to purchase private insurance can still do so, this doesn't fly as "government control" either. FYI."

It flys when gov mandates what type and how much coverage those "private" plans offer.

jimx: "Yes bobdog - because... (Below threshold)
bobdog:

jimx: "Yes bobdog - because the insurance industry's of country's with far more "socialist" health care are all doing just fine."

Are they, now?

What portion of the British national economy is healthcare? It's the largest item in their budget.

How many people work for the National Health Service in the UK? 1.4 million, third largest workforce in the world, after the Red Chinese Army and the Indian National Railways.

How much waiting is required for routine surgery in the UK? Canada? Look it up.

Any rationing under public healthcare systems around the world? Every damned day. That includes domestic state-run systems like Oregon, which famously denied a claim for chemotherapy treatment but offered state assisted suicide if the patient wanted it.

Man, where you been?




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