CBO Report Disputes Conservative Scare Tactics Regarding Public Option

Conservatives have been showing a strange lack of confidence in the free market. They generally take the line that private business is always far more efficient than anything done by government but they now claim that private insurance would not be able to survive if forced to compete with a public insurance option. We see examples that their arguments are wrong every day. George Bush set up Medicare Advantage plans to compete with the government-run Medicare program (although he also did give them large subsidies in return for their past campaign contributions). Federal Express, UPS, and other companies are doing well despite competition form the Post Office. A new Congressional Budget Office report also disputes conservative claims that the public option would force out private insurance:

A separate budget office report made public Monday found that a health care reform bill that includes a public option sought by Democrats would result in 3 million more people enrolled in employer-sponsored coverage by 2016, compared with what would happen under current laws. The report, responding to questions from Rep. Dave Camp, R-Michigan, was not a final review, the office said.

Pelosi seized on its findings, declaring: “The CBO has … disputed claims made by the Republicans about what our legislation will do.”

Hoyer said the Republican claim that a public option would reduce health insurance choices also is wrong, according to the budget office analysis.

“Republicans are making ridiculous claims, frankly, about reform because they know that the status quo cannot be defended,” Hoyer said.

Glancing through the blogosphere I note a pattern with regards to conservatives paying attention to CBO reports. Many Republicans are ignoring this report as they also ignored the CBO reports before the Iraq war which showed that the war would cost far more than the Bush administration predicted.

Conservative blogs did heavily cover two recent reports which showed little in the way of cost savings in the Democratic health reform plans. There is certainly a strong argument, which I have made in the past, that the Obama administration has been overly optimistic about cutting costs. This is a bipartisan problem. George Bush went as far as to threaten Medicare officials with being fired if they testified before Congress about the real cost of his Medicare Part D plan.

The CBO reports are not really good measure of potential cost savings due to the way that their studies are conducted. The CBO can only include hard savings which are included in current legislation. They cannot include estimated savings from various restructuring of the health care system which are likely to result in savings  but which cannot be measured. They also cannot include savings which are promised by the insurance and pharmaceutical industries but which are not firmly written into law.

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  1. 1
    jacksmith says:


    We have the 37th worst quality of healthcare in the developed world. Conservative estimates are that over 120,000 of you dies each year in America from treatable illness that people in other developed countries don’t die from. Rich, middle class, and poor a like. Insured and uninsured. Men, women, children, and babies. This is what being 37th in quality of healthcare means.

    I know that many of you are angry and frustrated that REPUBLICANS! In congress are dragging their feet and trying to block TRUE healthcare reform. What republicans want is just a taxpayer bailout of the DISGRACEFUL GREED DRIVEN PRIVATE FOR PROFIT health insurance industry, and the DISGRACEFUL GREED DRIVEN PRIVATE FOR PROFIT healthcare industry. A trillion dollar taxpayer funded private health insurance bailout is all you really get without a robust government-run public option available on day one. Co-OP’s ARE NOT A SUBSTITUTE FOR A GOVERNMENT-RUN PUBLIC OPTION. They are a fraud being pushed by the GREED DRIVEN PRIVATE FOR PROFIT health insurance industry that is KILLING YOU!


    These industries have been slaughtering you and your loved ones like cattle for decades for profit. Including members of congress and their families. These REPUBLICANS are FOOLS!

    Republicans and their traitorous allies have been trying to make it look like it’s President Obama’s fault for the delays, and foot dragging. But I think you all know better than that. President Obama inherited one of the worst government catastrophes in American history from these REPUBLICANS! And President Obama has done a brilliant job of turning things around, and working his heart out for all of us.

    But Republicans think you are just a bunch of stupid, idiot, cash cows with short memories. Just like they did under the Bush administration when they helped Bush and Cheney rape America and the rest of the World.

    But you don’t have to put up with that. And this is what you can do. The Republicans below will be up for reelection on November 2, 2010. Just a little over 13 months from now. And many of you will be able to vote early. So pick some names and tell their voters that their representatives (by name) are obstructing TRUE healthcare reform. And are sellouts to the insurance and medical lobbyist.

    Ask them to contact their representatives and tell them that they are going to work to throw them out of office on November 2, 2010, if not before by impeachment, or recall elections. Doing this will give you something more to do to make things better in America. And it will help you feel better too.

    There are many resources on the internet that can help you find people to call and contact. For example, many social networking sites can be searched by state, city, or University. Be inventive and creative. I can think of many ways to do this. But be nice. These are your neighbors. And most will want to help.

    I know there are a few democrats that have been trying to obstruct TRUE healthcare reform too. But the main problem is the Bush Republicans. Removing them is the best thing tactically to do. On the other hand. If you can easily replace a democrat obstructionist with a supportive democrat, DO IT!

    You have been AMAZING!!! my people. Don’t loose heart. You knew it wasn’t going to be easy saving the World. 🙂

    God Bless You

    jacksmith — Working Class

    I REST MY CASE (http://krugman.blogs.nytimes.com/2009/07/25/why-markets-cant-cure-healthcare/)

    Republican Senators up for re-election in 2010.

    * Richard Shelby of Alabama
    * Lisa Murkowski of Alaska
    * John McCain of Arizona
    * Mel Martinez of Florida
    * Johnny Isakson of Georgia
    * Mike Crapo of Idaho
    * Chuck Grassley of Iowa
    * Sam Brownback of Kansas
    * Jim Bunning of Kentucky
    * David Vitter of Louisiana
    * Kit Bond of Missouri
    * Judd Gregg of New Hampshire
    * Richard Burr of North Carolina
    * George Voinovich of Ohio
    * Tom Coburn of Oklahoma
    * Jim DeMint of South Carolina
    * John Thune of South Dakota
    * Kay Bailey Hutchison of Texas
    * Bob Bennett of Utah

  2. 2
    johnnie says:

    Those (GOP CLOWN SENATORS) up for re-election in 2010 are going into the (ABYSS). They have (CLOWNED) there (MORON BUTTS) for the final time. Mccain, DeMint, Shelby, Grassley,Vitter, Isakson, and even Colburn better watch his (IDOTIC) steps, the rest are (Finished) they going to feel the (WRATH) of the American People. They have (NO BRAINS) just (AIR) running between those (GOP) Heads. They (STUPIDLY) have embraced the Southern Ways , which is Political (SUCIDE) and are the (DUMBEST) party on the (FACE) of the EARTH, they deserve whats coming to them.  Being kick to the curb , and we watch the countdown on these (FOOLISH FOOLS) and see a (LARGER) majority in the (SENATE). They are stand for (GREED) RACIST platforms, and are just plain (EVIL) good -bye (CLOWNS) your in the refrigerator, the eggs are kooling ,and the butter is getting hard. IT is OVER GOP MORONS

  3. 3
    Fritz says:

    Ron — do any hospitals reject Medicare pricing?  Are they allowed to?

  4. 4
    Ron Chusid says:

    There conceivably might be small private hospitals which cater to the rich for things like cosmetic surgery which opt out of Medicare but it wouldn’t be practical for most hospitals. The big advantage of participating in Medicare is that they promptly send payment directly to those who participate. Opting out of Medicare would mean having to get payment directly from the patient.

    This isn’t unique to Medicare. With most private plans you get paid based upon their fee schedule.

  5. 5
    Fritz says:

    I was just wondering if Medicare acceptance was required for any other Federal programs.
    Fritz — typing class

  6. 6
    Ron Chusid says:

    Not any that I can think of.

  7. 8
    Ron Chusid says:


    I don’t think much of the analysis at all. It distorts the CBO report. It also manages to make things scarier since it is difficult to imagine numbers of this size. He says the cost will be $1 trillion over the next decade based upon his faulty interpretation of the data. Even if that is true that would mean spending ten percent more per year than the government now spends on health care. While significant, this amount of spending is not catastrophic, and would be less with any cost savings measures which are not scored due to the manner in which the CBO makes its estimates.

    His analysis is also rather absurd in down playing the problems of the uninsured.

  8. 9
    Jim Z. says:

    Your post points out how the Right is being refuted by the CBO on the issue of a public option, an element of health care reform that you have already, and often, declared to be irrelevant to a successful and worthy bill. Why bother now that a public option is as good as dead?

  9. 10
    Ron Chusid says:

    The politcal status, which can change at any point, and the facts of the matter are two different things. It is still worth pointing out the facts on the public plan until the matter is settled.

  10. 11
    Fritz says:

    For better or for worse, I agree that, even without a public option, this is a fork in the road.  If a bill passes and health care requirements get solidly Federalized, then a national system is in the works.

  11. 12
    Ron Chusid says:

    If anything the current actions in Congress show how much reluctance there is to any form of national system. I think this will only happen if we reach a crisis point where the private insurance system is no longer viable–which can happen in the next several years if nothing is done. Health care reform including stronger regulation of the insurance industry now is the best shot to prevent a totally government run system.

  12. 13
    Fritz says:

    The fun begins when insurance rates and coverage obligations get set by Federal legislation.

  13. 14
    Fritz says:

    At least not everyone pretends we currently have a free market:
    Huh — I did not know that France spends 11% of GDP on health care.

  14. 15
    Ron Chusid says:

    That estimate is a bit high. Reason is biased, and this article is hardly very accurate. With regards to the numbers, the US spends about 16% to 17% and France spends about 9.5-10% of GNP. Another comparison of significance is that they spend about $6100. Despite these differences France both has universal coverage and has a much better health care system than the US.

    Regardless of how they want to play with the numbers, the US has the lowest quality health care system in the industrialized world while spending the most and leaving the most uninsured.

    France does probably have the most expensive health care system in the world (which correlates with it having the highest quality by most measurements). If you don’t want to spend this much on health care you can always go for a single payer plan. Countries with single payer plans both spend less money and tend to show less growth.

  15. 16
    Eclectic Radical says:

    “If you don’t want to spend this much on health care you can always go for a single payer plan. Countries with single payer plans both spend less money and tend to show less growth.”
    Indeed, by pure numbers, ‘socialized medicine’ is the least expensive health care in the world. Other ways of acheiving comparable levels of coverage cost more because the cost sharing mechanisms are less efficient. This is not say that ‘communist hospitals’ are the way to go (though I certainly favor them, as everyone knows by now, for reasons of pure economics) if we are willing to pay for a strictly regulated and carefully subsidized private system or a genuine hybrid system.
    I think a public option is a good idea and that debunking false claims about public options or nationalized health care are important factors in changing the political landscape so that one or the other becomes a workable goal. So I certainly approve of someone with more hard medical knowledge than me doing just that.

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