Out From What Options Will States Opt?
More details are emerging on the “opt-out” public option. For one thing, my question of who does the opting has been answered—to opt out you need a bill based by both houses of the state legislature and signed by the governor. That means the vast majority of people will likely have the opportunity to join the public option.
On the other hand, the version of the public option that people will get to join would be a pretty limited one. Igor Volsky explains:
The comprise was developed by Sen. Chuck Schumer (D-NY), who converted Sen. Tom Carper’s (D-DE) original state-based opt-in proposal into a national opt-out option, and is far more conservative than the robust public option being considered in the House.
If the option is modeled on the provision in the HELP Committee’s bill, the plan would only save about $25 billion over 10 years, without significantly lowering health insurance premiums. It would likely lack Medicare’s market clout or leverage to significantly lower health care costs, but would still represent a not-for-profit alternative that can begin spearheading critical delivery system reforms.
Since both Senate bills establish state and regional based exchanges in lieu of a single national structure, it’s likely that the compromise in the merged Senate bill will establish 50 different options, all controlled by the Secretary of Health and Human Services. The public plan would have to attract a network of providers, charge premiums “in an amount sufficient to cover expected costs,” and meet all solvency and reserve fund requirements.
It’s been clear for a while that the support just isn’t there in the Senate for a more robust Medicare-linked public option. But this kind of pared-back public option is a lot worse than the meatier version. One reason folks like Ezra Klein and myself were saying over the summer than the public option fight wasn’t the be-all and end-all of health reform was precisely the awareness that any public option that passes the Senate would almost certainly have to be this kind of “level playing field” public option that only improves things marginally.
The best thing about the level playing field public option, however, is that it keeps hope alive. It might be able to spearhead some crucial delivery reforms. States that opted-out initially might opt back in. And with the public option in place, it could be altered over time in a more Medicare-ish direction as it becomes clear that that would be a way of helping to deal with the various deficit issues that will come to a head sometime after this recession ends.
27 Responses to “Out From What Options Will States Opt?”
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October 27th, 2009 at 2:42 pm
I predict absolutely zero states will opt out of plan.
Seriously. Whatever your definition of the reddest state is, I assure you that state keeps the public option. How many states actually turned down the stimulus money?
October 27th, 2009 at 2:44 pm
It looks like this is all a purely academic discussion, since Lieberman is set to prove all his detractors right.
October 27th, 2009 at 2:52 pm
If it’s really “50 different options”, then that would be incredibly disappointing. The reason this compromise sounded clever when first mentioned by Schumer was that it was a national plan that squared the circle with a little Federalism.
I agreed with the MY’s and Ezra’s line of thinking, but I was actually starting to get optimistic about something that might be more than just “better than what we have”. This… and Lieberman’s nonsesne… is making this day a downer… I need to go back to not paying attention to the sausage making.
October 27th, 2009 at 2:55 pm
Well, for once, Democrats have a real whip here – if someone like Lieberman, representing a blue state, won’t support Democrats on procedural issues (ending a filibuster), there is absolutely zero reason to keep him in the caucus anymore. Strip him of his chairmanships and throw him to the Republicans. There would no longer be any strategic justification for keeping him. In fact, there is a stronger incentive to bargain with Snowe on this issue since she appears to be a bit to the left of Lieberman on this issue. So Lieberman’s threat rings hollow to me. I don’t see him following through – He has too much to lose.
October 27th, 2009 at 3:01 pm
First off, they could easily strip Lieberman of his committee chairmanship, etc. They got some leverage on the guy. Hopefully.
Second off, anything’s good because it sets structure for future reform, like MY said. I just don’t understand why we’ll allow states to choose to opt out of the program, but not allow them to form compacts which can choose Medicare rates? That option would’ve been better than one large pool with a “level playing field.”
October 27th, 2009 at 3:02 pm
It puts a system in place that can be expanded on later. The alternative was to do absolutely nothing but make a few more toothless regulations nobody seriously expects will be followed. Guaranteed issue is not going to happen in any meaningful way, not under a senate this corrupt.
It’s just pathetic for Matt to complain about how little is actually being done given the degree to which he advocated doing even less.
October 27th, 2009 at 3:03 pm
Out From What Options Will States Opt?
I like the Yoda-speak.
October 27th, 2009 at 3:05 pm
It’s just pathetic for Matt to complain about how little is actually being done given the degree to which he advocated doing even less.
No, Soullite, you were proven wrong when you argued ad nausium that Obama was selling us out while Matt was guessed correctly that Obama was doing the best he could given the Senate and the circumstances.
Face the unpleasant facts.
October 27th, 2009 at 3:19 pm
Did Obama do the best he could? I haven’t heard any serious reporting about LBJ-style arm twisting of moderate Democrats. On the contrary, it appears as if he’s been hardest on liberals, by among other things, leaving the single-payer option out of the discussion from the very start. And now he won’t go out of his way to get the final votes for cloture.
October 27th, 2009 at 3:19 pm
It seems to me the opt-out actually provides a great opportunity for supporters of a more “Medicare-ish” plan.
Why not let states choose not only whether they want to offer the public option, but what kind of public option they want–Medicare rates, Medicare+5%, level-playing-field, or none at all?
Since the plan will be paid for through premiums anyway, states could choose what rate scheme they like and their doctors reimbursement rates and residents’ premiums would be set accordingly.
October 27th, 2009 at 3:21 pm
No, Soullite, you were proven wrong when you argued ad nausium that Obama was selling us out while Matt was guessed correctly that Obama was doing the best he could given the Senate and the circumstances.
Whoa, huh? It’s been abundantly clear for a while now that Obama has not favored all this PO stuff, probably for political reasons. That’s fine. But if you believe not supporting a PO is “selling us out,” then that’s what he did (especially since Reid seemed to have done this on his own). If you don’t think a PO’s a big deal or impossible, then Obama “did the best he could.”
Even if you ignore the PO, Obama hasn’t pushed back against Senate moderates much, has helped delay the bill through Baucus/Messina, struck unhelpful deals with opposing interests, and pursued needless bipartisanship. Because the Repubs have not chosen to participate in the health care debate, it’s as if Obama decided he’d be a one-man GOP to ensure a bill gets passed, no matter how crappy it is.
I think the president’s role should be to push for the best policy possible, not to preemptively settle for the bare minimum, so I definitely think he’s not done the “best he could.”
October 27th, 2009 at 3:26 pm
Even a very weak public option still puts in play an insurance company dedicated to the health of its policy holders rather than stock holders. I have total confidence that 20 years from now we will be very happy a public option of any type was passed.
October 27th, 2009 at 3:30 pm
Well, crunch time has arrived, and I very much like what I’m seeing in the architecture of the bills, especially considering how much worse they could’ve been.
Still, it seems to me discussions of legislative content have to take a back seat to questions of legislative tactics. I’m hoping somebody can talk me down, and that I’m missing something obvious, but where exactly is Reid getting sixty votes? I don’t see it. Are four or five centrist senators going to be bought off with new train stations, or ethanol subsidies, or loosened regulations on chicken plants? Or, do you suppose he really does have a plan B up his sleeve, and he’s fixin to hire a new, highly pliant parliamentarian?
Again, I like the boldness of Reid’s decision to go with the state opt-out public option, but it seems to me a risky strategy, and I could yet see Democrats snatching defeat from the jaws of victory. The loss of one or two Dems in addition to Jomentum, plus the loss of “reasonable” Olympia Snowe, plus blowback from the hamhanded attacks on Fox, plus a truly ugly loss in Virginia (and, God forbid, New Jersey), plus a stock market correction or worse than expected employment numbers, and pretty soon the passage of reform is no longer such a sure thing.
October 27th, 2009 at 3:30 pm
I think the president’s role should be to push for the best policy possible, not to preemptively settle for the bare minimum, so I definitely think he’s not done the “best he could.”
What matters is the end result, not all the drama and posturing during the “process.”
No-drama Obama is playing 3-D chess. If he gets the best results possible, doesn’t really matter how we got there. Besides did you see his big health care speech to Congress? He did praise the public option, just didn’t draw a line in the sand over it.
Would you rather he had drawn a line and not gotten it OR not drawn a line and got it in the end?
It’s not over yet, but I’m pretty impressed and I’m impressed Matt guessed right.
October 27th, 2009 at 3:43 pm
Please,
Someone explain the scope of the Public Option in the latest Bill(the Senate/Schumer/Opt-out).
All I want to know is whether this Public Option will “bend the curve,” or at least, will we get the primary savings benefits from Public Options, notably the (i) Administrative Savings; and (ii) Negotiation based on size Savings.
That’s all I want to know.
October 27th, 2009 at 3:44 pm
No-drama Obama is playing 3-D chess.
But as has been proven over and over throughout the process, progressive groups’ pressure has resulted in progressive end results, not some unfounded faith in Obama’s secret good will.
I’m not asking for “lines in the sand,” but arm twisting would be expected at the bare minimum…
October 27th, 2009 at 3:50 pm
October 27th, 2009 at 4:06 pm
Good post. This 50-state thing seems seems shaky. One thing I’d suggest looking into more is the role of the Health Exchanges. The idea is to allow people to buy into different plans that would compete within the exchange (including possibly the public option). But the one thing I’m confused about is what entity would be doing all of the great bargaining that the exchange is meant to provide?
We currently have competition among private plans in the private marketplace. The exchange is supposed to provide strength in numbers. Is this being done under the new bill?
October 27th, 2009 at 4:13 pm
I’m not asking for “lines in the sand,” but arm twisting would be expected at the bare minimum…
Who knows what’s happening behind the scenes? I agree with DTM when he’d say that he’s all for progressive groups applying pressure BUT
there’s no need to be name-calling and no proof to say a priori Obama sold us out. The facts are the facts and Obama will be judged on the results.
October 27th, 2009 at 4:49 pm
Since both Senate bills establish state and regional based exchanges in lieu of a single national structure, it’s likely that the compromise in the merged Senate bill will establish 50 different options, all controlled by the Secretary of Health and Human Services.
Motherfucker! I was just calling Armbruster stupid yesterday for saying this. I thought the whole idea was a NATIONAL plan. If it’s state by state who the fuck cares. Sorry, Armbruster, jokes on me. Fuck this whole thing.
October 27th, 2009 at 5:31 pm
Poptarts, this is some kind of joke? I mean, nobody can possibly be this… delusional. No matter what happened, it’s clear in that Obama was going to be a hero in your eyes. Even now, when it’s Obama was trying to kill this as recently as last week, you’re willing to pretend that this was all part of the plan.
October 27th, 2009 at 5:51 pm
Poptarts, this is some kind of joke? I mean, nobody can possibly be this… delusional. No matter what happened, it’s clear in that Obama was going to be a hero in your eyes. Even now, when it’s Obama was trying to kill this as recently as last week, you’re willing to pretend that this was all part of the plan.
I’d argue it is you who are delusional. No matter the evidence (or lack of it) Obama is a sell out in your eyes. The Democrats are sellouts. Well if they get a public option, then ergo you’re clearly wrong. Would you admit it? No, b/c you’re delusional.
Where’s the evidence Obama was trying to “kill” it? It was hearsay.
October 27th, 2009 at 6:44 pm
One reason folks like Ezra Klein and myself were saying over the summer than the public option fight wasn’t the be-all and end-all of health reform was precisely the awareness that any public option that passes the Senate would almost certainly have to be this kind of “level playing field” public option that only improves things marginally.
oh FUCK YOU Yglesias! Don’t you dare try to feed us this bullshit. Many of us believe it’s exactly the other way around. One of the reasons why the Senate won’t pass a robust public option is because last summer people like you and Ezra do what you always do in politics. You sold out. You didn’t believe it could happen so you didn’t fight for it so now we don’t have it. People like you and Ezra are the reason why we have no public option just as surely as you are the reason why we invaded Iraq. You believe it’s hip to associate with conventional wisdom and, whether out of fear or greed, you were willing to negotiate away every progressive idea in order to do that. Congratulations!
October 27th, 2009 at 9:30 pm
Re: If it’s state by state who the fuck cares. Sorry, Armbruster, jokes on me. Fuck this whole thing.
If you can drop the potty-mouth routine long enough to think like an adult, I offer the example of Canada, whose single-payor system got going as a province-by-province set-up, and is still mainly provincial rather than national in character. Since we have states that have populations comparable to Canada as a whole, state-level plans should do OK.
October 28th, 2009 at 12:29 am
I’m happier to have the opt-out public option than no public option. However, I must point out how ridiculous that we make it possible for states to opt out when it is in fact an option that individuals may opt out of.
Really, these defenders of states rights to step on individual liberties in the face of the overstepping federal government should refrain from calling themselves moderates. They are all out raving lunatics twisting federalism into an expensive and absolute clusterfuck.
October 28th, 2009 at 8:37 am
Poptarts, given that you’re a whackadoodle who believes that ‘anonymous source’ means ‘total made-up lie by the evil MSM’ and not the more accurate ‘administration official too chicken shit to on record’; I doubt there is anything that I can point to that would count as an attempt to kill the public option.
Someone this delusional can’t be reasoned with. You’ve clearly chosen to reconcile your previous “We don’t need the public option.” opinion with the current reality by declaring “Barack Obama had a super-secret plan to get the PO which I knew about despite a long history of being against the public option!”
You’re just fucking nuts.
October 28th, 2009 at 12:10 pm
If you can drop the potty-mouth routine long enough to think like an adult, I offer the example of Canada, whose single-payor system got going as a province-by-province set-up
Read the link you fucking douchebage. Yeah, a North Dakota public plan is going to have great bargaining power. What sort of grown man says “potty-mouth.” Cocksucker.