New Report: Existing Public Option Provisions Would Not Lower Costs, Better To ‘Trigger’ Robust Public Plan
New Report: Existing Public Option Provisions Would Not Lower Costs, Better To ‘Trigger’ Robust Public Plan
A new report from the Urban Institute argues that a “strong” public option triggered in the event that overall growth in national health spending exceeds a pre-determined target, may do more to control health care spending than the public option proposals offered in existing legislation:
In the absence of enough political support to pass a strong public option at this time, a “trigger” for a strong public option should be considered for inclusion in health reform legislation whether or not a weak public option is included as a political compromise. Even the threat of such a plan being triggered offers the potential to affect market dynamics between insurers and providers.
The report says that the Senate and House’s public option provisions (which require the public plan to independently negotiate rates with providers) would have little hope of lowering costs in areas of the country with high provider concentration. In areas where hospitals have “too strong a market presence to be excluded from insurer networks,” hospitals could dictate prices, stripping the public plan of its ability to negotiate cheaper rates, the report warns. According to a 2006 study, 86% “of large metropolitan areas were considered to have highly concentrated hospital markets.”
Policy makers can overcome the political challenges of enacting strong public option — one which compels Medicare providers to participate and establishes Medicare-like reimbursement rates — by placing the plan behind a trigger mechanism which “would allow private insurers the opportunity to show that they can provide affordable coverage under the new health reform rules.”
The report recognizes that “many proponents of a strong public option oppose a compromise relying on triggers because they believe that triggers would never be pulled” and suggests that structuring the trigger around overall growth in national health spending — rather than affordability — would make it more likely that a public plan would be established in the absence of meaningful cost containment.
“Opponents of a public option could argue to override the trigger by claiming that factors other than health plans’ inability to manage spending caused the lack of affordability,” the report warns. A “triggering event tied to affordability” could subject the public option “to the same controversy as now, with opponents arguing that other policies should be adopted instead of a public option and increasing the likelihood of congressional pre-emption of the trigger.”
To avoid these pitfalls, policy makers should consider basing the trigger on “overall growth in national health spending.” “An advantage of using growth in national health expenditures (NHE) is that the data are regularly and consistently reported and are directly related to the purpose of a public option—to create competition with private insurers to reduce health spending growth,” the report notes.
11 Responses to “New Report: Existing Public Option Provisions Would Not Lower Costs, Better To ‘Trigger’ Robust Public Plan”
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hospitals could dictate prices
Ohio hospitals still financially stressed-65% have conducted or plan to layoff workers. The Cleveland Clinic is mentioned in the article linked below:
http://www.medcitynews.com/index.php/2009/11/ohio-hospitals-still-financially-stressed-according-to-ohio-hospital-association-survey/
New Jersey hospitals are financially stressed. Nancy-Ann DeParle is associated with one:
http://stateofthedivision.blogspot.com/2009/06/deparles-new-jersey-deal-points-to.html
And the date of this trigger? America is obsessed with illusions of “free market solutions” and “pay for performance.” Does anyone recall the public utility model?
Look at the WaPo piece on distressed nonprofits. While it doesn’t specifically mention hospitals, they suffer from the current state of America’s dysfunctional health care system.
November 27th, 2009 at 1:28 pmKeep hammering those nonprofit community hospitals, I mean private tax exempt facilities on price:
http://ducknetweb.blogspot.com/2007/10/federal-agencies-stepping-in-to-help.html
November 27th, 2009 at 1:31 pmIgor, it looks like the next step for you is an HHS slot:
http://stateofthedivision.blogspot.com/2009/11/step-up-to-deparle.html
November 27th, 2009 at 1:32 pmThe good ole health care cost containment days, twelve years ago:
http://stateofthedivision.blogspot.com/2009/11/deparles-health-reform-twelve-years.html
November 27th, 2009 at 1:33 pmIf negotiated rates wouldn’t provide the Public option with a way of reducing medical costs, then presumably the private insurers won’t be able to do so either (and haven’t in the last few years???). If we assume that argument is correct, then how can we reduce health costs if not by reducing the price of things, one answer would be to buy less of them. From a consumer point of view, this is not pleasant.
November 27th, 2009 at 1:36 pmwhat utter crap
the POs in the bills are crap, but a trigger isn’t gonna make it better. The trigger can be removed.
November 27th, 2009 at 3:30 pmThis report is from 2006, when millions fewer were uninsured:
http://findarticles.com/p/articles/mi_m0EIN/is_2006_June_6/ai_n26887483/?tag=content;col1
Half of hospitals struggled:
http://findarticles.com/p/articles/mi_m0EIN/is_2006_Sept_13/ai_n26984862/?tag=content;col1
November 27th, 2009 at 4:45 pmCRITICAL!! From jacksmith – Working Class
My Fellow Americans and People Of The World
A strong Government-run MEDICARE like Public Option is CRITICAL!!
I have to tell you now that the H1N1 virus is a manmade WEAPON OF MASS DESTRUCTION! and TERROR! It is a WEAPONIZED version of a flu virus. It has swept the planet infecting millions. And causing a global pandemic that has killed tens of thousands, and injured millions.
The H1N1 virus is the product of the DISGRACEFUL, GREED DRIVEN PRIVATE FOR PROFIT MEDICAL INDUSTRIAL COMPLEX! It was released in the U.S. in Texas in early January of this year, but not recognized until around April in California. The reason I know this is because when it came to America, it came to see me FIRST! How sweet…
This was around the time the MEDICAL INDUSTRIAL COMPLEX! assaulted the Whitehouse with all their devils deals to cripple and weaken YOUR! healthcare reform. Especially your right to have a single payer system like HR676 (Medicare For All) which most of you wanted.
They don’t even want you to have your HUGE!!! compromise position of a strong government-run MEDICARE like Public Option CHOICE. To compete with their DISGRACEFUL, GREED DRIVEN, MURDEROUS, PRIVATE FOR PROFIT PRODUCT (The single most deadly and dangerous product sold in America).
They also wanted to take away your rights to have your government meet it’s responsibility to use it’s full power to regulate, negotiate, and control drug cost, healthcare cost and quality. Something every other civilized country in the developed World has done for it’s people. Their Greed! moral degeneracy and lack of patriotism knows no bounds.
Many of you will remember that before we knew about H1N1. I posted a open message to the President and Congress warning them to be vigilant about their health, and cautious about any medical advice they received. As I said then “they will not hesitate to try and hurt you”.
The U.S. and the World have been under a BIOLOGICAL TERROR ATTACK! for over a year now. It is CRITICAL that We The People Of The United States take away control of our healthcare system from the GREED DRIVEN MEDICAL INDUSTRIAL COMPLEX!
For our own National security, and the security of the world.
A Strong, government-run, MEDICARE like Public Option CHOICE. Available to everyone on day one, with the full unfettered power of the federal government to regulate, negotiate, and control cost and quality. Would be the most workable way to deal with this global crisis at this time. Including patent suspensions as needed for national security or the greater good.
As an American I invite the peoples of the World to help us fix our healthcare crisis. And bring pressure on our government to meet it’s responsibility to protect global security by controlling, and removing the corrupting influence of GREED and the PRIVATE FOR PROFIT motivations from healthcare in the U.S. and around the World.
I call on the governments of the World and the global intelligence community to track down these MASS MURDERERS, and bring them to justice. CONNECT THE DOTS! And be vigilant that they don’t slip in another viral strain on you under the cloak of H1N1 sequestration.
Further, the proposed patent protection on biologic’s must be stripped from the US bill. And greatly shorten/restricted, or abolished completely. This is a grave danger to humanity and global security.
I think President Obama is doing the best he can at playing the disastrous deck of cards he inherited from the previous administration. And I think he is doing an excellent job. But the wolves and devils of the medical industrial complex! are trying to exploit, and take advantage of his good heart, and desperate desire to help suffering Americans. But we must be strong and insist that healthcare reform be done right for the American people. Or everyone loose’s.
This is all I can say in a message post. I’ll try to find a way to tell you more later.
God Bless You My Fellow Human Beings
jacksmith – Working Class
p.s. The so-called nominal H1N1 virus is designed in such a way as to make it more lethal to children and young adults. The medical community must be more vigilant of secondary bacterial infections in the young caused by H1N1. And remember, a viral infection is also a transfer of genetic code to you. Think about it, and be vigilant. :-(
November 27th, 2009 at 4:50 pmI ran across this story on Bloomberg. It pertains to Jacksmith’s posting:
Adrian Gibbs, the virologist who said in May that swine flu may have escaped from a laboratory, published his findings today, renewing discussion about the origins of the pandemic virus.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=ajw2AS.d1wK8
November 27th, 2009 at 5:10 pmHealth care legislation suffers normal, and timely constraints of the bureaucratic process; IMO, it is critical to adopt balanced legislation, and universal health care insurance with a public option! Also, this policy will be inherently balanced and funded, because it will more completely cover families, veterans, and seniors, through either employers’ plans, or federal or states’ health insurance!
November 28th, 2009 at 9:25 pmThat’s simply not true. A new MIT study came out saying that it would lower costs. Check it out and tell me why they have gotten it wrong! http://cli.gs/9233PM/
November 29th, 2009 at 7:43 pm