'Public Option' a Shadow of Its Original Intent - Dr. Marcia Angell Advises Optional Medicare Buy-In

By marginalizing the single-payer model from the outset, Democrats have already backed away from making the best case for health care reform as means to economic recovery.
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Dr. Marcia Angell, former editor of the New England Journal of Medicine, senior lecturer in social medicine at Harvard Medical School and author (The Truth About the Drug Companies: How They Deceive Us and What to Do About It), suggests a simple, less costly alternative to building a health care "public option" from scratch. Instead, permit individuals to buy into Medicare, a known quantity with low overhead costs close to 3%, with high rate of public support - polls show higher favorability ratings among those covered by Medicare than those covered by private insurances.

"The public would be happy with Medicare for all. Polls have shown that the public loves Medicare," observes Dr. Angel.

"Public option" remains an amorphous term that is variously defined and deconstructed by different stakeholders, like a Rorscharch Test. Truthfully, the concept of "public option" as currently written in proposed bills is a faint imitation of its original intent, writes Kip Sullivan of Minnesota Physicians for a National Health Program, who evaluated the "public option" features of the current House and Senate Democratic proposals, and concluded that they lack most of the criteria laid out by Jacob Hacker who originally defined the concept. Hacker envisioned a public program closely resembling Medicare, with a large enrollment of the non-elderly population. The Lewin Group's 2001 evaluation of Hacker's "Health Care for America Plan" affirmed reduced overhead and premium costs, and predicted that a lesser number - 2 million - would remain uninsured.

Nevertheless, of the following 5 original criteria that Hacker and the Lewin Group specified as critical to the success of the "public option," only one is met by current House bills.

Hacker's Original Five Criteria of a Health Care Public Option:

• The Public Option had to be pre-populated with tens of millions of people, that is, it had to begin like Medicare did representing a large pool of people the day it commenced operations (Hacker proposed shifting all or most uninsured people as well as Medicaid and SCHIP enrollees into his public program);

• Subsidies to individuals to buy insurance would be substantial, and only Public Option enrollees could get subsidies (people who chose to buy insurance from insurance companies could not get subsidies);

• The Public Option and its subsidies had to be available to all nonelderly Americans (not just the uninsured and employees of small employers);

• The Public Option had to be given authority to use Medicare''s provider reimbursement rates; and

• The insurance industry had to be required to offer the same minimum level of benefits the Public Option had to offer.

Concluded Sullivan, the only one of Hacker's five original criteria met by current Democrats' proposed bills is the latter one, requiring the insurance industry to cover the same benefits the "public option" must cover. None of the other four criteria are met.

By marginalizing the single-payer model from the outset, Democrats have already backed away from making the best case for health care reform as means to economic recovery. Too many have tended to fold in the face of Republican/corporate distortions, willing to abandon even the principles of a strong public option.

The likelihood is that the influence of the insurance industry would distort the "public option" into "a dumping ground for the sickest while they cream off the young and healthy for themselves," observes Dr. Angell.

Even if skittish lawmakers insist on incremental change, Angell suggests that the age of eligibility for Medicare can be gradually lowered by decade, e.g., to 55, then later, to 45, etc.

Dr. Angell notes that the Medicare prescription drug benefit has been a bonanza for the pharmaceutical industry and should be changed to provide for negotiation of bulk drug rates. Provider reimbursements need to be improved and costly subsidies to private plans eliminated. Currently, the fee schedule "preferentially rewards highly paid specialists for very expensive tests and procedures. For the system to work, it would have to be a nonprofit delivery system," she says.

But changes can be made over time, as Thom Hartmann writes in an open letter to President Obama. For now, Democrats should permit individual enrollment in Medicare, and call it the public option. The Medicare billing structure is in place and Medicare recipients have full free choice of providers, in contrast to private plans that limit choice to in-plan providers.

Democrats, bypass the narrow prescriptions of the "Gang of Six" and the distortions and distractions purveyed by partisans. Implement a system that is known and favored by many as your "public option" -permit Medicare buy-in.

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