Ilovebenefits’s Blog

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For Or Against a Public Plan

Editor’s note: For those in favor of a so-called public plan, I cannot help but wonder whether they understand what is contained in the public plan, its construction, financing, administration and its other hydraulics. Are they simply reacting based on sound bites and political rhetoric?

If business is so opposed, you would have to ask why. After all, if a public plan were enacted and business could turn the cost and administration of health insurance for all its employees over to the government and the taxpayer why would they resist so vehemently. If the cost of health care versus other countries is what causes our products to be uncompetitive with the rest of the world then having them removed from the bottom line of business — would be a good thing. But that’s not how key business leaders see it unfolding. And for good reason. They don’t magically disappear as a cost of doing business and improve our global competitiveness, despite what some might be telling you.

Business is resisting for a series of reasons:

1) The only way costs will be controlled under a government plan over time  will be the equivalent of wage and price controls as well as shifting costs to the private sector. This will cause business  to pay higher premiums and to shift those additional costs to its employees. Wage increases to employees will become even more scarce. We will pay more taxes, more of our own health care costs and we will not receive increases in our wages.

The $10 billion dollars of savings estimated by CBO is government savings only, not actual system savings. Just a few less dollars in taxes that need to be collected.

2) If reimbursements are reduced to providers (doctors and hospitals) fewer will accept patients with public plan insurance. (See an earlier post about what is already happening to Medicare patients’ access to care.) This will make it harder for people to seek and receive the care they need.

3) If a government plan could actually control costs, then why is Medicare in the financial shape it is? What will be different between the ‘public plan’ and Medicare? If Congress has the answer to health care costs why not enact those changes with Medicare and pilot the solution?

4) By CBO estimates there will be at least 18-20 million people (not including illegal aliens) still uninsured in this country, if all goes according to plan. So we will still have large amounts of uninsured costs to pick up as a nation beyond the budget estimates. Wasn’t the objective to provide health care to all Americans?

5) Taxes will continue to rise for everyone, draining investment dollars for jobs, innovation and growth of the economy. Isn’t jobs the number one issue in America?

6) And finally, everyone has to remember that the only way that this is ‘deficit’ neutral is that the government collects more taxes — your and my money.

So someone please explain how a public plan addresses these issues. What it does, is allow elected officials to provide watered down access to health care to more people with the money of the people who already have coverage. The public plan doesn’t provide better quality or better cost. These folks are voters, too.

For sure, there are other reforms that are needed and essential to improve access to and quality of care. We need to improve both.


By Jeffrey Young
The Hill
10/28/09 10:36 AM ET

Any kind of government-run health insurance program would lead to higher costs for employers, corporate executives representing a big-business group said Wednesday.

The Business Roundtable, an alliance of corporate CEOs, criticized the public option in conference call with reporters as congressional Democratic leaders intensified their push to include a government plan in their healthcare reform bills.

“We’re here to voice our strong opposition,” said John Castellani, the president of the Roundtable.

“This week, the Senate healthcare reform effort took a wrong turn,” said Antonio Perez, the chairman and CEO of Eastman Kodak Company who chairs the Business Roundtable’s Consumer Health and Retirement Initiative.

Although the health insurance industry’s opposition to the public option has received the most attention, business and healthcare groups are practically unanimous in their opposition and have been since the beginning of the debate.

Now that Congress is inching closer to final action, business groups are stepping up their messaging campaigns. The business community has become increasingly anxious as the prospects for the public option have improved on Capitol Hill.

The Business Roundtable’s chief argument against the public option is that a government plan would offer lower payments to medical providers who, in turn, would raise the rates they charge for patients enrolled in employer-sponsored health insurance plans.

“It won’t contain costs. It will just shift them to the private payers,” Castellani said. “The state opt-out provision does nothing to blunt that impact.”

Senate Majority Leader Harry Reid (D-Nev.) shifted the healthcare reform debate leftward on Monday when he announced that the bill heading to the Senate floor would include a public option. Reid settled on a compromise version that would allow states to opt out, winning over a handful of centrist Democrats but losing Republican Sen. Olympia Snowe (Maine) along the way.

House Speaker Nancy Pelosi (D-Calif.) is also reportedly close to rounding up the votes she needs to include a nationwide public option in the lower chamber’s bill. According to Congressional Budget Office estimates, the public option would lower the cost of healthcare reform and attract as many as 10 million enrollees.

Reid’s proposed compromise did not satisfy business and insurance groups. Perez said it would take a “miracle” for Congress to devise a form of public option that corporate America could support.

The Senate Finance Committee approved a bill this month that did not include a public option but Reid decided to favor a separate measure passed by the Senate Health, Education, Labor and Pensions Committee on the issue.

While the Finance Committee legislation was “not perfect,” Perez said, it “provided a bold framework that we liked for healthcare reform.”

Unlike the U.S. Chamber of Commerce, which is rolling out television ads to fight the public option, the Business Roundtable plans no so campaign. “We will rely primarily on the face-to-face visits [and] the phone calls” between corporate CEOs and lawmakers, Castellani said.

Verizon Communications Chairman and CEO Ivan Seidenberg, who chairs the Business Roundtable, said the group’s members would keep pushing their agenda. “We don’t believe the process is over — far from it,” he said. “We’re going to start with this call and we’ll go from here.”


October 28, 2009 - Posted by | Federal Government, healthcare | ,

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