A Blue Eyed Buddhist

You know, it strikes me that we hear a lot of people ranting- on both sides of the healthcare reform issue- about “socialism” or “public option”, and I think it’s while a lot of people don’t really understand what is actually being discussed.

So you know, here’s the scoop. The “public option” is basically an open-to-all healthcare plan that’s similar to Medicare. Everyone and anyone could sign up for it. Of course, there are proposals to help people pay for the premiums in this public option, but the main point of it is that instead of limiting healthcare reforms to other things (like making insurance companies accept anyone and everyone for any plan they offer, working to reduce drug costs, incentives to reduce paperwork and get everything online, etc), this “public option” would also offer a plan that would presumably be quite inexpensive.

THAT, folks, is where all the opposition comes from. The key point is “cheaper”. Despite what you might believe or have been told, the reality is that Medicare is incredibly less expensive than private insurance plans. It’s for a number of reasons, but perhaps the biggest two reasons are pretty simple ones to grasp.

First, Medicare is WAY more efficient. Advertising costs for Medicare are virtually nonexistent; with no marketing needing to be done, that’s more money from “premiums” that goes directly to patient care. More importantly, administrative costs for Medicare are far, far less expensive than private insurance plans. Admin costs in Medicare run around 2% of the overall cost of the plan; that’s a fraction of private insurance plans.

Secondly, and more obvious… a government-owned plan is non-profit. Many of us have non-profit health insurance anyway, but plenty of others don’t- and you can bet that those for-profit companies absolutely HATE the idea of a non-profit entity getting into the health insurance business. Or did you think that all the advertising and all the organizing and all the talking heads you see on the cable TV news networks were for free?

We’ve actually already seen this very effect in real life. If you’re old, you have probably heard of something called “Medicare Advantage”. These plans are administered by private insurance companies and their original intent was to create competition and reduce costs compared with traditional Medicare (which is run by the government- non-profit, remember). In reality, Medicare Advantage winds up costing 12% MORE than traditional Medicare does.

So you don’t have to be a rocket scientist to see that the private companies that are running the majority of healthcare insurance in this nation are going to be dead-set against a non-profit, simple, government-owned plan getting into the game. That’s why they’re so vehemently against the “public option”.

There’s something else to consider about the public option plan. You don’t have to join.

I know, I know- those of you on the right wing have been fed a steady diet of “Barack Obama wants to take away your choice” and you’re hearing “socialism” this and “Nazi” that. (Never mind that socialists, like Soviet Russia, and the Nazis, like 1930′s and 40′s Germany, were completely different ideologies that were sworn enemies. Logic holds no place in political hype.)

But the thing about the public option is that if you don’t want to be in it, you don’t have to. You can continue to keep your present insurance plan!

No “government panels” deciding whether or not to give you money for your broken foot or whatever. You can stick with your private plan if you want.

Of course, your private plan will cover less, cost more, and have more paperwork involved. It will, frankly, suck compared with the public option. But hey, it’ll be up to you to stick with it if you want.

Now, are there things to not like about the public option? I suppose there are. Over time, since most people will probably switch to it, it will probably become the dominant insurance plan in most markets- kind of like how two (private, for-profit) companies presently dominate over a third of Americans’ insurance right now.

And that means that this plan will have a lot of control over pricing. Doctors might not be able to make as much money as they do today, because the public plan will be working to keep prices down.

Of course, considering how much health insurance costs right now, lots of us actually see a force working to keep prices lower as a GOOD thing, not a bad one.

Anyway, that’s a little bit about the public option. Now you can go forth and scream some more about health insurance and how horrible it is that Obama wants to kill your nephew or whatever, but at least you’ll hopefully understand it a bit better.