Monday, August 17, 2009

The Problem(s) with the "Public Option"

Obama's health care reform strategy seems to be finding most of the substantive contention around the "Public Option." I've got some bad news for the administration and its supporters: the Public Option's got issues. A lot of them. And they may even be terminal.

Here's a step-by-step guide to problems with Obama's cornerstone of health care reform:

The Words
The two words in play, public and option, do anything to advance the meaning of the concept they are attempting to describe. "Public Option" reeks of echo-chamber-liberalism-trying-to-market-itself-as-acceptable language that, no surprise, hasn't worked.

The first problem is the word "public." "Public" indicates it's for everyone... like how a public park is for anyone who wants to enjoy said park. Yet, as legislation is evolving, the "Public Option" would not be for everyone. It'd be for some people, and in most bills in development, there are strict limitations on who can join the "Public Option."

Then there's the word "option." This is supposed to indicate that we as Americans will have another option in health care insurance. Yet, again, many will not have this option because -- thanks to the conservatives being so worried that if everyone takes this "option" then there will be no more private insurance -- there are a lot of firewalls defined that don't allow the Public Option to be a viable option for many who currently are covered by private insurance.

The Meaning
"Public Option" not only means nothing without additional context, but it also evokes socialistic sub-contexts thanks to the use of "public." In the supposedly less marketing-savvy days, some really good marketing/branding folks devised the terms "Medicare" and "Medicaid." The talent that named these programs must have long past, because "Public Option" pales in comparison. What does "Public Option" mean with very little context? It means that the public has an option. Why would the 80% of Americans who already have insurance want to pay even more taxes for another option that most won't ever use?

What the public wants is lower costs, better quality and -- when possible -- broader access. None of these meanings are conveyed by the term "Public Option."

The Message
The messengers for the "Public Option" really fumbled by not having a cogent response to the detractors who state that if a public option is so good, then why would we need private insurance companies? Take this to the logical conclusion, and if the government can provide superior services, then we will end up with a "single payer" system, which the Obama administration promises is not on the docket (even though Obama himself claimed that he was personally a proponent for single-payer as a U.S. Senator a few years ago). So, the lack of a strong defense against this Trojan Horse concern has given the detractors credibility because they're gaining traction in the "what comes next" argument.

The Policy
I'm all for Obama's "thread the needle" approach to policy, but moderation is not really in the cards with the American culture these days. As much as the average American is centric/moderate, we as a culture reward Big Plans with Big Visions and Big Solutions. This is why so many embraced the Bush Doctrine of foreign policy even though it's since proven to be a quantifiable foreign policy disaster. We like compromise as a nation, but not at the expense of avoiding the tough choices needed to reform things. Americans like to vote for things that involve no pain, but we also like being told to suck it up and to be tough. The "Public Option" is really a middling policy that isn't really a Big Idea and really doesn't ask us to give much up.

Yet there is a more practical, systemic concern: As much as I think the free market has all but failed America in terms of health care insurance and cost containment, pitting a government plan against private industry is just not the right role for government. Government should not be competing with industry -- ever. It should be enabling economic growth, while protecting the rights of citizens, ensuring fairness, healthy competition, and taking responsibility for the administration of public good works. Under this model of government, health care reform should come in one of two flavors:

1. Go completely single-payer, where we extend the 6% administrative overhead of Medicare to replace the 20-30% overhead of private health care insurance companies. Leverage economies of scale and completely transform our health care system to align with the the notion that our health and well-being is more important than shareholder profits. Single-payer has shown to improve outcomes, life expectancy and costs in many nations already. Yeah, it's got its own problems, but better health care is better health care. And single-payer has proven out to provide better health care on a macro level.

- OR -

2. Play the full regulation card, where the government enforces strict regulations on a completely private health care system. This would keep everything in place as it stands today, but introduce new, tough "rules of the road" that all insurers must abide by, equally. This would include universal access to affordable insurance, no limits on pre-existing conditions, no dropping of coverage, etc. In other words, the government plays the role of citizen advocate and referee, and ensures that the business of health care insurance is more equally balanced between profits and keeping Americans healthy and alive. In addition, the government could and should enforce innovation in automation and administrative cost controls across insurance firms on behalf of citizens. This regulated industry approach has a lot of precedent, and would have the extra-super-double bonus of costing merely a fraction of adding a Public Option to the mix.

Either of these approaches to policy could work, and each has its pros and cons. But at least both of them present a level of policy clarity that people can better understand, contemplate and opine upon. The "Public Option" is so vague and un-descriptive that the idea of "death panels" has risen from the murkiness. It might feel better to blame Sarah Palin (who made Obama's so-called "Death Panels" famous) for derailing the dialog around health care reform, but I'd argue that it's the echo-chamber-policy-wonks who are to blame for poorly naming, positioning and selling health care reform in the name of the "Public Option."

Don't get me wrong -- there are a lot of benefits to the Public Option scheme. It's just that these benefits are not seeing the light of day, in part, due to the issues outlined here.