CBO Says Co-Ops Not Effective

The Congressional Budget Office, the non-partisan score keeper of the fiscal impacts of bills before Congress, says that the cooperatives proposed by the insurance industry Senator from Montana, Max Baucus, would probably not achieve the market presence necessary to influence "total enrollment in the insurance exchanges or federal costs"{Obama's True Color, 8.17.09}. In contrast a robust public insurance plan option would be more effective in reducing the total cost of the program. It could net $150 billion in savings over ten years. Consequently Democrats searching for common ground between the progressive and conservative wings are entertaining an idea to let the states run the public option program with an opt-out provision*. Senator Schumer (D-NY) told media that the idea was "being seriously considered". States which decide not to have the national public option plan would have to develop their own or face flight to states offering such low cost coverage to their residents. Medicaid, which provides poor people with health care and is a jointly funded federal-state program, has a similar opt-out provision but all 50 states have chosen to go with the program since 1982. Arizona was the last state to join up and none have dropped out. Got federal highways, Arizona? Got federal stimulus money, Texas? The Public Option: it's good for the federal deficit, good for health care providers, and good for Americans.

*Senator Sherrod Brown (D-OH) has collected the signatures of 30 senators who support a robust public option. In his letter to Majority Leader Reid he writes, "As it stands, the health insurance market is dominated by a handful of for-profit health insurers that are exempt from the anti-trust laws that ensure robust competition in other markets across the United States. Without a not-for-profit public insurance alternative that competes with these insurers based on premium rates and quality, insurers will have free rein to increase insurance premiums and drive up the cost of federal subsidies tied to those premiums. This is simply not fiscally sustainable." Ask your senator if he or she is supporting the public option.