Public Option Is Not The Worst Aspect Of ObamaCare

Much of the hullabaloo over President Obama’s health care speech to Congress last week focused on his endorsement of a “public option” — that is, a government-run, not merely government regulated health insurance plan for the non-elderly middle class.  Throughout the August congressional recess, it appeared as though the White House was ready to abandon the public option, since that was a major source of contention among congressional Republicans, Blue Dog Democrats, and a sizeable portion of the American public.  In his speech, Obama paradoxically came out firmly in support of a public option, while acknowledging that his support was not so firm that he wouldn’t be willing to bargain the public option away.

Still, the public option is not the worst aspect of the various Democratic health reform proposals, the mandatory purchase requirement is.  Under each of the three bills moving through Congress, every person living in the United States would be required by law to have insurance.  And, if your employer doesn’t provide you with it, you’ve got to buy it yourself or pay a fairly stiff monetary penalty.  What’s more, each of the proposals would eliminate some of the options that are available now — particularly the low-cost insurance plans that cover only catastrophic health events and have substantial cost-sharing features.  And, depending on which bill would eventually be enacted into law, Congress, state insurance commissioners, and/or a federal Health Choices Commissioner would be empowered to determine whether any given plan even “qualifies” as health insurance.  The end result will be higher, not lower costs, for almost every person living in the country.

President Obama knows this, of course.  During the presidential campaign, he roundly criticized Hillary Clinton for proposing essentially the same thing.  As today’s Wall Street Journal points out:

“The political irony here is rich. If liberal health-care reform is going to make people better off, why does it require “a very harsh, stiff penalty” to make everyone buy it? That’s what Senator Obama called it in his Presidential campaign when he opposed the individual mandate supported by Hillary Clinton. He correctly argued then that many people were uninsured not because they didn’t want coverage but because it was too expensive. The nearby mailer to Ohio primary voters gives the flavor of Mr. Obama’s attacks.

And the Baucus-Obama plan will only make insurance even more expensive. Employers will be required to offer “qualified coverage” to their workers (or pay another “free rider” penalty) and workers will be required to accept it, paying for it in lower wages. The vast majority of households already confront the same tradeoff today, except Congress will now declare that there’s only one right answer.”