The Public Option Con
Selling Out Single-Payer
By HELEN REDMOND
April 26, 2009
“As we roll out new products we will continue to price businesses for appropriate margins. We will not sacrifice profitability for membership.”
— Angela Braly, Wellpoint CEO
At the Health Care for America Now (HCAN) and Citizen Action Illinois sponsored rally in Chicago last weekend, single-payer advocates confronted HCAN leadership and Democratic Congresswoman Jan Schakowsky (D-Illinois) who instead of working to pass HR 676, John Conyers single-payer bill titled the United States National Health Insurance Act, are supporting the so called “public option.”
What the public option plan is, no one can exactly say. There are no concrete proposals spelling out what the plan would include, who could join it, how much it would cost, or how it would be funded. But the details don’t matter, they advocated for it anyway.
In a heated exchange with Schakowsky before the rally, she argued HR 676 (she is a cosponsor of the bill, yes that’s right) has no chance of passing and something has to be passed this year. She lied and said there isn’t enough support for single-payer, but there is for a public option. I and other activists challenged Schakowsky on every assertion and demanded she fight to pass HR 676. We said the insurance industry is going to fight just as hard against a public option as it will single-payer so let’s have a smackdown for single-payer. We argued the passage of HR 676 would guarantee an end to the crisis and finally make health care a human right that could never be taken away. She got pissed and complained loudly to her staff as she walked into the building, “Can you believe she is lecturing me?” I yelled after her, “I’m just expressing my opinion, I’m your constituency.”
The rally was a slick “Sell out single-payer and confuse em’ show” from start to finish, replete with retro 70’s song Ain’t no Stoppin’ Us Now blasting into the auditorium.
HCAN staffers, state representatives, Tom Balanoff - President of SEIU Local 1, small business owners, patients, doctors and medical students all took the stage, outlined different aspects of the crisis, and rightfully denounced the insurance and pharmaceutical companies. Their solution: the creation of a public plan to compete against the private insurance industry they despise. Speaker after speaker projected a wish list of health care reforms onto the nonexistent public option plan: benefits must be comprehensive, coverage must be affordable, no denial of care, and equal access to quality care. Who could disagree if a plan like that could actually be enacted? The problem is the United States will never, ever get a plan like that while the private insurance industry is still breathing. HCAN and liberal Democrats have to engage in this “magical thinking” in order to convince a skeptical public that a public option embedded in a for-profit system can work. Only a single-payer system, one that drives a stake through the heart of the insatiably greedy insurance corporations once and for all, can deliver on those promises.
A little history is in order.
The American health insurance system is based on the avoidance of the elderly and sick so insurers didn’t care much when Medicare was created: seniors have complex and costly health care needs that cut into profit margins. Let the government and taxpayers foot the bill for old people. Plus, people aren’t eligible for Medicare until they turn 65 so the vampires would have decades of opportunity to bleed Americans into medical bankruptcy. A similar dynamic was at work with Medicaid: poor people tend to have chronic health problems and that cuts into profit margins. Let the government and the taxpayers take care of them, but the minute they are healthy enough to work, kick ‘em out of the program and into the clutches of the vampires or the ranks of the uninsured. Whose left? Everybody in between. That’s what is driving the insurance industry and Karen Ignagni, the Chief Evil Officer (CEO) of America’s Health Insurance Plans (AHIP), into a frenzy. They fear a public plan will snatch away “their” market: the millions of people who don’t fall into the above categories of old and poor, especially the young and the healthy. It’s the profits, stupid!
Ignagni and the industry are whining that if a new government insurance program is created to compete with them, like Medicare, that’s unfair competition and they’d be driven out of business. Ohhh, don’t you feel sorry for Ignagni and all the other millionaire CEOs?
They think a government health plan would be unfair to them. But they’re exaggerating the effects a public plan would have on their pursuit of profit. Just look at how they have sunk fangs into Medicare.
Doctors Himmelstein and Woolhandler from Physicians for a National Health Program (PNHP) explain:
“A quarter century of experience with public/private competition in the Medicare program demonstrates that the private plans will not allow a level playing field. Despite strict regulation, private insurers have successfully cherry picked healthier seniors, and have exploited regional health spending differences to their advantage. They have progressively undermined the public plan — which started as single-payer for seniors and now has become a funding mechanism for HMOs — and a place to dump the unprofitably ill. A public plan option doesn’t lead toward single-payer, but toward the segregation of patients, with profitable ones in private plans and unprofitable ones in the public one.”
Private Medicare Advantage plans cost the government 13 percent more per beneficiary on average in 2008, and overhead for private plans is also much higher, at 13 percent, compared to 2-3 percent in traditional Medicare. Of the 45 million Medicare recipients, 23 percent are in private plans. Most Americans aren’t aware of the extent of privatization of Medicare.
What is the lesson HCAN draws from the privatization of Medicare? On their website an article is posted titled, Will Government Give Public Health Insurance an Unfair Advantage? Experience Tells Us No. Experience shows the government has given an unfair advantage to private insurers when it comes to the Medicare program, which HCAN acknowledges. In twisted logic that is hard to follow, HCAN thinks that’s a good thing, it’s proof the government won’t lower reimbursement rates or impose cost controls on private insurers. Now HCAN is all about reassuring the insurance industry they claim to loathe so much they only want a public plan to compete against them on a level playing field: the goal is not to drive them out of business.
This is the logic that confuses people mightily. One minute HCAN is calling out the insurance industry for the profit-hungry killers they are, then they argue the companies need to stay in business to compete against a public plan honestly in the marketplace — even though they agree they never compete fairly, Medicare being the prime example.
The health care reform proposals advocated by Jacob Hacker from the University of California at Berkeley are suddenly all the rage, but there is nothing new about them. He proposes a national health exchange of private plans with the addition of a public option (essentially Obama’s position.) Hacker, like HCAN, is careful to assuage the fears of the private insurers and says under his scheme, “More Americans have private insurance after reform than do before — either through their employer or through the national exchange.” Smells a bit like Massachusetts where 200,000 people remain uninsured and the costs to subsidize the program have doubled from $630 million to $1.3 billion.
Single-payer advocates oppose the creation of a public plan for a different set of reasons.
1. It doesn’t make health care a human right that can never be taken away.
2. It continues to divide, devalue, and define people by their health status.
3. It can’t address the endemic racial and gender disparities in the system, including the 12 million undocumented.
4. It leaves the employer based system of health care provision intact. That link has to be broken so workers are free to change jobs, go on strike and not fear loss of coverage.
5. The system would continue to have multiple payers and therefore the complexity and gaps in coverage that are inevitable when there are numerous bureaucracies to navigate.
6. Where will the money come from to finance the plan, especially in a time of economic recession, like right now? A public plan is not fiscally sustainable because it’s rooted in a multiple payer system that foregoes at least 84% of administrative savings.
Single-payer on the other hand, would immediately inject 400 billion into the system by eliminating bureaucracy, billing apparatus, administrative waste, advertising, corporate profits, and CEO compensation. That’s enough money to bring everyone into the system with no co-pays or deductibles.
We don’t need any more feasibility studies or examinations of single-payer in other countries. It’s a proven fact that a single-payer system can cover everyone and control costs. Period, end of discussion.
So the question becomes why don’t the Democrats and HCAN fight to get rid of the parasitic private health insurance industry (the source of the crisis) once and for all instead of constantly and unsuccessfully, decade after decade, trying to rein in, regulate, and do an end run around them?
For the Democrats, with the exception of John Conyers and a few others, they simply don’t want to abolish the private insurance industry. They are capitalists and believe in the capitalist system that makes health care a commodity to be bought and sold. For them, health care is not a human right. And importantly, they don’t want to take on President Obama who is opposed to single-payer. Like the true cowards they are, they will not oppose Obama on health care reform even though they disagree with him.
HCAN thinks it’s impossible to get rid of the insurance companies, they’re too powerful, and they have too much money and influence. They don’t believe a large social movement can be built to take on and win against the insurers and the government. The leadership of HCAN are the ones who would have said under slavery, “We can’t win abolition, so let’s settle for a few reforms that make the lives of slaves more bearable.”
This attitude is astonishing given the sea change in consciousness around health care. A number of events have coalesced to make winning a single-payer system possible. No longer does the invoking of “socialized medicine” scare people, not after the government has socialized billions of dollars of losses in the financial sector. If the government can bail out AIG, why not the health care system? Poll after poll shows the majority of Americans want a government run health care system that guarantees health care. People often express this by saying, “I want what they have in Canada.” Physicians used to be an obstacle to single-payer, now 59% support single-payer.
Employment-based health care is collapsing and employers want to get out of the business of providing health care to workers: it costs too much. Millions of laid off workers now realize tying insurance to employment status is a disaster; lose your job, lose coverage. Those with jobs are paying staggering premium increases for less coverage. Single-payer legislation has been introduced into the House HR 676, and SB 703 in the Senate. There is a grassroots movement, including unions, all over the country organizing and fighting for single-payer. And most significantly, people are ANGRY and want change.
HCAN and Democrats like Schakowsky are deceiving and leading people down yet another dead end alley of incremental reform. We’ve had decades of incremental reform and now there are 50 million uninsured, 25 million underinsured and between 18,000 to 100,000 people die every year because they lack access to health care. For spineless Democrats like Schakowsky and HCAN, the day will never come when single-payer is “politically feasible,” because if now isn’t the time, when will it be?
The fight to make health care a human right is the new civil rights struggle. We are standing on the shoulders of all the great social movements that have come before us.
The time to win single-payer has never been better. We are going to keep fighting like hell to destroy the corporate killers, not create a faux option that allows them to live another day.
Sí se puede, yes we can!
Helen Redmond is a member of the Chicago Single-Payer Action Network and a Licensed Clinical Social Worker. She works in the emergency room at Cook County Hospital and blogs at http://helenredmond.wordpress.com She can be reached at firstname.lastname@example.org