Wonk Room » AHIP Explains Its Opposition To The Public Plan

AHIP Explains Its Opposition To The Public Plan

By Igor Volsky on Mar 11th, 2009 at 10:40 am

AHIP Explains Its Opposition To The Public Plan

America’s Health Insurance Plans (AHIP) — the insurance industry’s lobbying arm — is hosting a health care policy forum in Washington D.C. This is the second of a series of posts from inside the conference.

When ThinkProgress asked AHIP spokesperson Robert Zirkelbach about the lobby’s opposition to a public plan, Zirkelbach explained that the insurance lobby was concerned the the “government-run program” (as he called it) would undermine health care providers, employers, and the “sustainability” of the entire health care system”:

- Impact on providers: “Public programs pay less than their costs and those costs are being passed through the health care system and it’s ultimately employers and consumers who are footing the bill.”

- Impact on the employer community: “This could cause many people to leave the employer market and enroll in a government-run plan. This is something employers have expressed concern.”

- Sustainability of our current health care system: “Medicare actuaries say that the Medicare system is going to start running deficits as soon as 2017. We have to make sure we’re using our public resources as responsibly as we can — as we can. We believe in a public program”

Watch it:

A public plan would actually alleviate AHIP’s “concerns” about runaway health care costs and running deficits. As Harold Pollack argues rather succinctly over at The Treatment, “experience suggests that effective public programs provide high-quality, cost-effective care” and it would “have greater leverage in encouraging standardized quality improvement strategies and electronic medical records.”

A public option could reduce projected health care costs by about “$2 trillion over 11 years, and lower premiums by about 20% on average.” Within a decade, 105 million people would be enrolled in the public plan, and about 107 million would have private insurance.

But brush AHIP’s objections aside, and their real concern is sacrificing profits to competition. Medical loss ratios, an indicator of how much revenue insurance companies spend on care vs. how much they keep as profits, have dropped precipitously in the last decade. Forcing private insurers to “shave-off” some administrative costs and compete with a public option may very well reverse that trend.

For policy makers, this is really an argument about the proper role of government. As Dean Baker argues, “some people, who tend to be left of center, think that the government’s role is to try to promote the general good, by providing basic services, protecting the poor and the sick, and ensuring a well-working economy. On the other hand, there are others, who usually place themselves right of center, who believe that the proper role of government is to redistribute as much income as possible to the wealthy. These competing views of government are coming to a head in the debate over national health care reform.”

Comments
9

9 Responses to “AHIP Explains Its Opposition To The Public Plan”

kali Says:

Zirkelbach explained that the insurance lobby was concerned the the “government-run program” (as he called it) would undermine health care providers, employers, and the “sustainability” of the entire health care system:

this is TOTAL crap.. the only thing a government-run program would undermine is the health insurance companies’ PROFITS… I don’t know who these people think they are kidding…
March 11th, 2009 at 12:25 pm
Connecticut Man1 Says:

This:

As Dean Baker argues, “some people, who tend to be left of center, think that the government’s role is to try to promote the general good, by providing basic services, protecting the poor and the sick, and ensuring a well-working economy.

Plus this:

CNN: 72% Want More Governmental Involvement With Health Care

Means that, certainly in the case of health care, 72% of Americans are left of center.

ADIP:
American’s
Denial
Insurance
Plans
March 11th, 2009 at 12:26 pm
Connecticut Man1 Says:

And this bad because???

“This could cause many people to leave the employer market and enroll in a government-run plan. This is something employers have expressed concern.”

The whole point is to run the privatized ripoff into the ground while still allowing them time to restructure their companies into a business that actually provides something other than a leeching effect on paychecks, other businesses’ bottom lines and the economy as whole.
March 11th, 2009 at 12:33 pm
DrSteveB Says:

If we have to give up on single payer becuase the powers that be say so (despite it being the only proposals that actually controls costs and delivers care that is universal and comprhensive and has 60% support in independent polling; not predetermined stuff like Celinda Lake for HCAN), then let us have REAL public option per Rep. Pete Starks proposal: he leaves in place private coverage. Keep what you have if you want to. But offers a variation of Improved and Expanded Medicare for All that is really a public option that would then compete with privates.
March 11th, 2009 at 1:25 pm
kali Says:

yes, expanding Medicare for those not able to get insurance in the private sector makes PERFECT sense… now to the irrational-thinking right-wingers who care only about the interests of the private insurance companies of course this solution won’t work…. it seems this country will have to “run circles” around a solution that really works just because Repugs and right-wingers have this knee-jerk irrational disdain for ANY solution that involves the public sector.

man, what bunch of crackpots, I swear…
March 11th, 2009 at 3:39 pm
Connecticut Man1 Says:

It is easily arguable that the irrational people are the people that cater to the the crackpots.
March 11th, 2009 at 4:01 pm
Connecticut Man1 Says:

Kind of like inviting Hannibal Lechter over and being surprised at what he wants for dessert after the chicken dinner. :)
March 11th, 2009 at 4:05 pm
DrLeigh Says:

re: comment #7: Exactly, ConnecticutMan1! Shouldn’t be too shocking.
March 23rd, 2009 at 2:30 pm
Angie Says:

Zirkelbach explained that the insurance lobby was concerned the the “government-run program” (as he called it) would undermine health care providers, employers, and the “sustainability” of the entire health care system:

I am curious about how some of our experts appear more concerned about the healthcare industry as it is now, possibly failing if public health care is enacted. It is amazing to me that other industries have failed and we survived. People have been working with one company all of their lives and one day everything was gone. Too many people are dying because of the practices of healthcare providers and maybe they should’t be allowed to continue as it is. It is criminal how people without the ability to afford healthcare are being treated. Our lives are in their hands. So yes, I do believe public health care should be available and provided evenly for all the people. What is the price for a life? Who should determine care? Let’s not continue to allow this industry to discriminate based on profit istead of care when needed. Finally, I have good insurance coverage, but I am supportive of public health care if it will help those who are uninsured or simply can’t afford the high cost of health insurance.
April 3rd, 2009 at 1:52 pm