Polls On The Public Option

Ed Brayton and Jed Lewiston mock Sean Hannity’s inane criticism of polls showing support for the public option. Showing the fallacies in Sean Hannity’s logic is always a very easy way to write a blog post.

Obviously Hannity’s objections aren’t worth considering. On the actual topic of polling the public option, results typically show a majority in support but the results vary widely. Part of this is because, as I’ve pointed out in recent posts, there are a variety of ideas which are lumped together under the public option and we don’t yet know which will pass Congress (assuming any form of public option passes the Senate).

Most people have no clue as to the specifics and the wording of a poll influences the results considerably. If you ask about whether people should be offered the choice of a public option (stressing choice) or compare it to Medicare, people are more likely to support it. There was some talk about rebranding the public option as Medicare for Everyone last week but some are now backing away from that idea.

On the other hand support will poll lower among those who believe the fallacies spread by the right, such as that the public option is a back door method of bringing about “socialized medicine,” or that it will be funded by taxpayers as opposed to those who voluntarily choose the option. (On the other hand, there are some to the left of the Democratic Party who are upset with the currently proposed public option because it doesn’t go far enough to be able to eventually evolve into a single payer plan).

I’ve also noted a couple of ironies in the past when considering the opponents of the public option. Conservatives who most complain that the cost of health care is too expensive, or that we cannot afford universal health care, are the ones who are most likely to oppose the public option which would help to keep down taxes.

It is also ironic that conservatives, who speak the most about the free market system (unfortunately in a religious manner which frequently replaces any real understanding of economics in the real world) show so little faith in the private sector that they believe that insurance companies could not compete with a government option. This is especially absurd considering the lengths that the Democrats went through in the hopes of receiving support from the insurance industry to propose legislation which will be highly profitable for the industry. While absurd it is not surprising as the opponents of health care reform from the right generally have no understanding of what is actually being proposed and therefore have no basis by which to judge the effects of heath care reform.

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30 Comments

  1. 1
    Fritz says:

    It looks like we will get a bewildering bill that will include a government-run and subsidized health care plan to compete with private insurance companies that will get government subsidies to compensate for the subsidies for the government plan.
     
    I can see why the suits in the insurance companies will be appeased.   And why government bureaucrats will be happy.  But why should anyone think this bears any resemblance to a competitive market?

  2. 2
    Ron Chusid says:

    Fritz,

    No, there will not be a “a government-run and subsidized health care plan to compete with private insurance companies.” That idea was taken off the table months ago.

    “But why should anyone think this bears any resemblance to a competitive market?”

    Because we do not have anything similar to a competitive market now. In most areas one or possibly two insurance companies dominate the market. Giving a choice of a public option will at least put in more competition.

    See  A Free Market Case For The Public Option

  3. 3
    Eclectic Radical says:

    “But why should anyone think this bears any resemblance to a competitive market?”
     
    “Because we do not have anything similar to a competitive market now. In most areas one or possibly two insurance companies dominate the market. Giving a choice of a public option will at least put in more competition.”
     
    The national exchange being discussed will also mean that private insurers will need to compete with each other more directly than they do now. Everyone in the exchange will need to compete with everyone else in the exchange plus any public option. As I’ve said before, this is a lot more ‘free market’ than the current situation even by right-wing or libertarian standards even if it is not the anarcho-capitalist ideal.
     
    It’s actually closer to McCain’s campaign plan than Obamas’, but with the proviso that it is the creation of a true national market rather than merely breaking down the borders between state markets to race to the bottom.
     

  4. 4
    Ron Chusid says:

    This isn’t really like McCain’s idea. Insurance exchanges have been a part of Democratic proposals for a long time. Republican ideas to open up to out of state competition are really schemes to avoid state regulation and make it easier for insurance companies to collect premiums while reducing what they have to cover. This is quite different from the insurance exchanges which would place more requirements on insurance companies.

  5. 5
    Fritz says:

    Are you saying there will be no taxpayer money spent to set up the government health plan (aka public option)?  That seems highly unlikely to me.  The money to set it up needs to come from somewhere — and health plan companies aren’t cheap.
    Or are the subsidies and government “investments” supposed to trail off some time in the future?  Like just after the government sells GM?
    The government plan, once it is set up, will be fed through continued infusions from the Federal government from now on.  The only question in my mind is whether it will be the dumping ground for expensive ill people only (what the insurance executives want) or if the goal is to subsidize it enough to kill of the private health care plans (what self-titled progressives want).

  6. 6
    Eclectic Radical says:

    I agree with your characterization of insurance deregulation entirely… and that is what the McCain scheme was, insurance deregulation. I won’t deny that.
     
    That said, the insurance exchange notion is closer to everything McCain /claimed/ insurance deregulation would be than Republicans want to admit. I didn’t think that was the worst explanation for Fritz.
     

  7. 7
    Ron Chusid says:

    Fritz,

    Tax money might be spent on the initial set up but long term money will have to come from premiums. One thing which has become clear from the actions of Congress this year is that there is no support for anything which would give the public plan an advantage at the expense of private plans.

    Neither of your two scenarios are likely. It is not likely to become a dumping ground for expensive patients to the degree insurance companies want since only a minority of people will even be elligible for the public option. Those obtaining coverage through the exchanges as opposed to receiving coverage through employers would be able to choose between private plans and the public option. Private plans participating in the exchange would not be able to deny coverage to those who are sick, or be able to dump them once they do get sick.

    There will be no subsidies which would enable the private plan to kill off the private plans, even if some are hoping this will happen. Again, the public option would only be available to a minority of people. Those covered by employers will not be affected. As the CBO has projected, the current health care legislation will result in more people having private coverage than is the case now.

  8. 8
    Eclectic Radical says:

    There are a few examples of public businesses like the public option to draw from.
     
    The two most obvious and successful are the US Postal Service and the Tennessee Valley Authority. Both are ‘government agencies’ that operate effectively and competitively in the free market with private businesses and yet do not drive their private competition out of business. As Ron has noted repeatedly, UPS, FedEx and DHL are not going anywhere and there are numerous smaller messenger services as well. Yet the post office competes effectively and makes a profit. TVA also turns a profit, and it has not driven energy corporations out of business at all.
     
    The goal in most of the existing legislation is for the public option to be a competitive insurance company. Not for it to be an entitlement. Frankly, this bothers me because I think it /should/ be an entitlement, but it’s better than nothing.
     
    It’s also unlikely to pass without a state opt-out that will further weaken it.
     
    My big concern is that it will not be able to make a profit without copying private insurance companies’ business methods, because it is not possible to make profit providing actual health coverage and providing full service. While this is a personal opinion, I think it is one supported by economic fact. Another reason for my socialism on this topic.
     

  9. 9
    Ron Chusid says:

    Remember that private insurance companies will be prohibited from continuing some of their current practices.

  10. 10
    Fritz says:

    Ron, I strongly disagree with your prognostication.  But this is something we will know in n years.   IMO continued subsidies will grow (not shrink).  The alternative would be to cut services to the poor (think of the children!) or raise premiums to the poor (think of the children, part two!).

  11. 11
    Ron Chusid says:

    Fritz,

    It isn’t a matter of prognostication. It is a matter of 1) what is actually in the legislation under consideration and 2) what members of Congress are showing they support.

    You still do not understand what the public plan is. It has nothing to do with how much services the poor receive. The public plan won’t even be available to the poor. It is simply a matter of offering another option to those who are paying for health care on the individual market and will only affect a very small percentage of people.

    There are no subsidies, so there is no question of them growing or shrinking. The income to the public plan would be based upon insurance premiums collected.

  12. 12
    Fritz says:

    Insurance companies will not be able to use pre-existing illnesses.
     
    But will they not be able to use behavioral history?  Like your history of smoking?  What about your sexual history?  And if you lie, could they not disenroll you if they figure it out?

  13. 13
    Ron Chusid says:

    Details such as this are still to be finalized.

  14. 14
    Fritz says:

    Ron, of course there are subsidies — the government plan needs to be funded.  The question is whether the government  contribution will then be phased out in time.  I’m betting “not”.  What’s in the legislation now and what legislators say they will support now is not terribly relevant — the question is whether legislators in 4 years will allow a default.  That would be politically not feasible.
     

  15. 15
    Ron Chusid says:

    That’s a rather contradictory argument. Opponents of the public option generally complain that private companies cannot compete with the public option. Now you are saying it would go under?

    Judging by the attitudes of those currently in Congress, it is extremely unlikely that there would be the votes to bail out the public option should it be a failure.

  16. 16
    Fritz says:

    It won’t go under because Congress won’t let it do so.  In fact, they will make sure there is enough public subsidy to give it a strong edge.
    I find it hard to believe that you think that Congressmen would not bail out the government-branded health care plan when it needs more money.
    But, again, we are back to predicting the future.

  17. 17
    Ron Chusid says:

    Again it is not a matter of predicting the future. It is a matter of looking at what is actually going on as opposed to making baseless predictions based upon your biases. Giving it money to give it any advantage has been rejected. A change in the law will be necessary to do this.

    There is not the support in Congress for this.  The number of members who support a strong public option is not likely to increase unless the Republican Party collapses even more than at present. Even then, Democrats from old Republican states are more likely to be like the conservative Democrats who now oppose the public option.

  18. 18
    Fritz says:

    Ron, can you give me a list of social programs that the Federal government has established and then allowed to fail?
     
    Clearly the money is going to go into it to establish it as part of this bill.  For maintenance, the current Congress can say anything it wants — that subject won’t come up for a few years.

  19. 19
    Ron Chusid says:

    You are still missing the point. The public option is not a social program or a government financed program.

  20. 20
    Fritz says:

    Where is the initial funding going to come from to set up the public option?

  21. 21
    Ron Chusid says:

    Fritz,

    We are just going around in circles. That is irrelevant to the question of  ongoing funding of the program. You continue to ignore 1) what the actual legislation says, 2) what is required to obtain new funding, and 3) the limited support for the public option in Congress.

    The currently proposed legislation prohibits the federal government for subsidizing the public option. In order to do this new legislation would be necessary. It is doubtful that such legislation could even get near a simple majority and it would certainly not receive the necessary 60 votes to survive in the Senate.

    A major rational for the public option is that it will reduce costs. If instead it turned out to be a potential drain on the federal budget I is doubtful they could even get a majority of Democrats to support new legislation to fund it.

    Again, you are also contradicting the primary objection to the public option from the right that private insurance companies could not compete with the public option as currently planned. (Of course most of those making this argument also do not understand what the public option actually is.)

  22. 22
    Fritz says:

    OK, so initial funding comes from the government.  That’s why I was confused by your assertion that this is not a “government financed program”.
     
    Since you contend that, assuming a shortfall after the initial funding spree, the government would let the government health care system go bust and fail rather than throw it more money, I think it is completely reasonable for me to ask of you have a list of other social programs that the Feds have let go bust rather than continue to fund.   I don’t think that would happen.
     
    Sure, there’s limited support *now*.  But once a program is in place, history shows that it is almost impossible to kill it.  The people pushing the government plan know that.    I don’t know why you have never seen that dynamic.

  23. 23
    Ron Chusid says:

    This is not a social program like those you are referring to but a program which is required under law to be self-supporting based upon premiums. We don’t have any totally analogous situations so your question does not apply. The closest we might have is the partial government funding for public broadcasting, which has been dropping. Even then it is not a good analogy since public broadcasting was set up to receive some degree of ongoing public financing but the public option isn’t.

    History does not show what you claim as we don’t have any situations such as this in the past. There is no good reason to think that support for funding will increase when there is very little support for such funding now, and if the program failed support for it would be more likely to fall than to increase.

  24. 24
    Fritz says:

    I figure the final bill will have a government health care plan.  So if we are all still around in a few years we can check back in on whether government finances are still going in.  Clearly we have different predictions on that.
    Hmm… Would Amtrak be analogous?  Wasn’t that supposed to be self-sufficient based on tickets?

  25. 25
    Ron Chusid says:

    I don’t know much about the specifics of Amtrak in terms of how self-sufficient it was, but even if it was supposed to be it isn’t really analogous.

    One difference is that if Amtrak goes under, there will be no commercial rail in an area. If the public plan turns out to be unable to compete with the private plans on its own (which is the opposite of what most conservatives are predicting) then if it goes under there will still be private insurance available.

    Another difference is political motivations. I would bet that members of Congress would fight very hard to keep Amtrak from leaving their districts.

    With the pubic option, we now only have about half of Congress in support–and that is with a lot of arm twisting of the more moderate Democrats. If it turned out to be costing money as opposed to saving money, there wouldn’t many members of Congress who would have any interest in preserving it. We also have members of Congress from both parties who are being influenced by the insurance lobby to oppose it.

  26. 26
    Ron Chusid says:

    Now that the House bill is posted I was able to check a little more into the start up costs. As expected, the federal government will have to foot the bill for start up costs. However, the bill also requires that the start up costs be amortized into future premiums to provide a level playing field with the established insurance companies. Actually this seems to give the insurance companies an advantage since they already are established companies with resources built up over the years.

  27. 27
    battlebob says:

    Would it be wise to allow insurance companies to cross state lines which would improve effeciency?

  28. 28
    Ron Chusid says:

    Not with the current system. Insurance companies already can set themselves up to sell insurance in any state–but they must obey the laws of the state. The push by Republicans for crossing state lines is because this would allow insurance companies to operate out of the states with the most lenient requirements and avoid state regulations in the other states.

    If the health care reform legislation is passes which sets national standards (and which ends the exception from anti-trust laws for the insurance companies) then I don’t know if there will still be a need for the current restrictions.

  29. 29
    Eclectic Radical says:

    As I understand it, the national standards will only apply to the national exchange and companies that do not participate in the national exchange will still be able to do as they please on the state level. Ditto, employer-paid insurance will be almost entirely untouched unless the employer choose to change providers.
     
    On a totally separate note, as I’ve mentioned before, the assumption that nothing is wrong with employer-paid insurance and that everyone with insurance through their job is amazingly happy with it is one of the weaknesses of the bill.
     

  30. 30
    Ron Chusid says:

    The exchange will replace the current individual market and will pretty much apply to those buying insurance on their own as opposed to obtaining through employers. One of the earlier Senate bills I read did allow for policies to also be sold outside of the exchange but I don’t know if this is in the current House bill.

    Employer-paid insurance will not be untouched. There will be protections against people being dropped from coverage (or rates hiked up so high that they are dropped, which is how it often happens). The coverage will also be portable so people won’t be forced to remain in a job because of the insurance coverage.

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