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Designing a public option

Greenbeard

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Similar to when it laid out all the design considerations that would go into designing a single-payer model back in 2019 (Key Design Components and Considerations for Establishing a Single-Payer Health Care System | Debate Politics), the month the CBO has laid out some the key design considerations in putting together a federal public option:


It's a good read, but for those short on time they've collected the questions into a succinct visual:

57020-figs-1_public-option-design.png


Handy, as always!
 
What a mess.

It's a good example of why socialist command economies always fail. Note also that this absurd agglomeration is only about paying for healthcare. Imagine what it would look like if the stupid, incompetent, corrupt government were actually providing the healthcare.

If you look at the graphic, it's all questions. So how will those questions be answered? They will be answered by politics, and when decisions are made by politics, the politically powerful tend to get their way.

Ain't democracy grand?
 
What a mess.

It's a good example of why socialist command economies always fail. Note also that this absurd agglomeration is only about paying for healthcare. Imagine what it would look like if the stupid, incompetent, corrupt government were actually providing the healthcare.

If you look at the graphic, it's all questions. So how will those questions be answered? They will be answered by politics, and when decisions are made by politics, the politically powerful tend to get their way.

Ain't democracy grand?

Holy **** if you think that graph is complicated, I hope you don't check out how private insurance works.
 
My thoughts on some of the questions, for whatever it's worth.

Care management strategies - I'm not seeing why they wouldn't, mainly for the purpose of being judicious about the provision of cost-effective care.

Would a public option advertise? I don't think there would be a lot of need for that. If some small degree of it is necessary to encourage people to remember there's a marketplace, subsidies, etc. rather than just going direct and paying full price, well okay, but I don't see much benefit in a public option competing for ad space to promote itself. If people go to the marketplace, the prices and benefits will speak for themselves.

Would a public option pay taxes/fees? I don't see the point in governments taxing governments, least of all the federal government being taxable by states.

How would providers be encouraged to participate if not tied to federal programs? Well, through competitive fees for services, right? Coverage should be comparable to what the non-public plans out there are paying, otherwise providers will opt out if at all possible, which they do with Medicare and Medicaid in some cases already.

How would the PO set rates? Depends what the goal is. More generous rates makes establishing a broad participating provider network easy, but then the PO becomes more expensive to the consumer (which the public would find irksome, i.e. they'd ask what's the point of a PO if it's more expensive), or if public funding subsidizes this extra cost it makes better coverage cheaper than it could reasonably be for the non-PO carriers, maybe even leading to some adverse selection into the PO and undermining the real competitiveness of the marketplaces.

What metal tiers would the PO be offered in? Also depends what the goal is. I don't know why it wouldn't be offered across the metal tiers. The way I calculate plans out, it looks to me like the only reason a person should ever choose a Gold plan is if they know they'll hit the OOP maximum every year and would rather pay that cost spread out throughout the year via premiums than in cost-sharing. I've never been able to calculate any other advantage to Gold plans. And with Silver, unless a person's subsidy is more than the cost of the bronze plans, and/or they qualify for CSRs that only apply to the Silver tier, there's little reason to choose Silver either, compared to Bronze. Not sure if that pricing has any relevance to whether a PO should or shouldn't be offered across tiers, but that's my attitude of the tiers and how subsidies affects them. So maybe one thought is just offer the PO in the bronze tier, to try to get people thinking rationally about pricing and the benefits of HDHPs and HSAs, to reduce people's tendency to voluntarily pay more overall for the psychological satisfaction of a small deductible. But, unfortunately there are still a ton of people who see a high deductible and automatically regard it as "crap" coverage, so this would be a strike against its popularity right out of the gate.

Would the PO conform to state regulations? Well there's an awkwardness to the federal government having to follow state rules, but again it would seem that if the PO doesn't attempt to make its plans comparable in most ways to the others in the marketplace, it could eventually undermine the marketplace's functioning/competitiveness. So I would think the PO should aim to be comparable and more or less closely compliant with what the other plans face in a given area.

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I'm not sure I like the idea of only selectively offering a PO, based on some boardroom analysis of where it's deemed needed. I think there'd also be public backlash from "losing their PO" if someone at DHHS determined the other plans' prices had improved and thus handed them back to the other carriers.

Excess revenues should perhaps to small degree be refunded to customers the way the medical loss ratio rules require, but beyond that should probably just go to the treasury, or thought of as an offset to the otherwise monumental public cost of health care. Shortfalls are invariably going to impact the deficit, but perhaps should trigger some pricing adjustment in following periods, as long as such adjustments don't render the PO non-competitive.

Should the PO establish a trust fund? I'm just gonna say no.

That's all I have for now. But what do I know? I'm just an amateur on the sidelines.
 
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Similar to when it laid out all the design considerations that would go into designing a single-payer model back in 2019 (Key Design Components and Considerations for Establishing a Single-Payer Health Care System | Debate Politics), the month the CBO has laid out some the key design considerations in putting together a federal public option:


It's a good read, but for those short on time they've collected the questions into a succinct visual:

Handy, as always!
One tiny little problem. Your single-payer health care scam violates the Tenth Amendment.

The federal government only has the powers specifically granted to it by the US Constitution. All other powers, unless specifically prohibited by the US Constitution, belong to the States exclusively. Like healthcare, education, social spending, etc.

That means Congress cannot enact a single-payer healthcare scam of any kind without usurping State authority and violating the US Constitution. Only the States have that constitutional authority, as Massachusetts demonstrated with RomneyCare.
 
How would providers be encouraged to participate if not tied to federal programs? Well, through competitive fees for services, right? Coverage should be comparable to what the non-public plans out there are paying, otherwise providers will opt out if at all possible, which they do with Medicare and Medicaid in some cases already.

How would the PO set rates? Depends what the goal is. More generous rates makes establishing a broad participating provider network easy, but then the PO becomes more expensive to the consumer (which the public would find irksome, i.e. they'd ask what's the point of a PO if it's more expensive), or if public funding subsidizes this extra cost it makes better coverage cheaper than it could reasonably be for the non-PO carriers, maybe even leading to some adverse selection into the PO and undermining the real competitiveness of the marketplaces.
.I'm not sure I like the idea of only selectively offering a PO, based on some boardroom analysis of where it's deemed needed. I think there'd also be public backlash from "losing their PO" if someone at DHHS determined the other plans' prices had improved and thus handed them back to the other carriers.

These are interesting related points. On the one hand you could imagine a public option that's more or less left to its own devices after being created, allowed and encouraged to make business decisions like any other insurer and without any special privileges for being publicly-sponsored. Then its value is really just in injecting another option in the marketplace. And since marketplaces with more insurers competing tend to have lower premiums, that's a worthy approach.

On the other hand, arguably one of they key reasons we want a public option anyway is so that underserved marketplaces/rating areas will have a new insurer. But these are by definition areas that most other insurers have found to be a poor business decision, perhaps because they can't match the provider prices the dominant (lone?) incumbent insurer has achieved. When various marketplaces/rating areas become more attractive business then we see market entrants, as we're seeing in many places this year and next, and don't necessarily need to create a new public one just to have another seller. And a public option with no local market share and no special leverage to get lower provider rates isn't going to be any more effective at entering or competing in those places than any other insurer faced with the same incentives.

So if we really want a public option that's going to venture in and sell in places where most insurers won't, and otherwise change the game, it seems like it needs some sort of pricing advantage (rate-setting ability) relative to incumbents, which may in turn require some kind of stick to require provider participation. But then you don't necessarily even need a new public insurer if that's the key, you can just require/allow existing private insurers to sell products that get to tack onto government rate-setting in some way. That's the route Washington has gone with its "public option" plans and it's what was on the table in Connecticut's proposed public option a couple years back before the proposal was scrapped.

One tiny little problem. Your single-payer health care scam violates the Tenth Amendment.

The federal government only has the powers specifically granted to it by the US Constitution. All other powers, unless specifically prohibited by the US Constitution, belong to the States exclusively. Like healthcare, education, social spending, etc.

That means Congress cannot enact a single-payer healthcare scam of any kind without usurping State authority and violating the US Constitution. Only the States have that constitutional authority, as Massachusetts demonstrated with RomneyCare.

Here on Planet Earth the feds already sponsor health insurance plans, so that ship has sailed.
 
What a mess.

It's a good example of why socialist command economies always fail. Note also that this absurd agglomeration is only about paying for healthcare. Imagine what it would look like if the stupid, incompetent, corrupt government were actually providing the healthcare.

If you look at the graphic, it's all questions. So how will those questions be answered? They will be answered by politics, and when decisions are made by politics, the politically powerful tend to get their way.

Ain't democracy grand?


That must be why it works on every first world country except ours, where we pay twice as much and get less, and ration by wealth.
 
The government insurance plan would wind up with all the worst cases. Far from breaking even, it would incur huge debt that the tax payers would have to pay.


.
 
One tiny little problem. Your single-payer health care scam violates the Tenth Amendment.

The federal government only has the powers specifically granted to it by the US Constitution. All other powers, unless specifically prohibited by the US Constitution, belong to the States exclusively. Like healthcare, education, social spending, etc.

That means Congress cannot enact a single-payer healthcare scam of any kind without usurping State authority and violating the US Constitution. Only the States have that constitutional authority, as Massachusetts demonstrated with RomneyCare.

I think that claim was adjudicated back in the 1960’s.
 
Here on Planet Earth the feds already sponsor health insurance plans, so that ship has sailed.
Very true, illegally. The majority of States are still suing to overturn the illegal law, and they will not stop until the authority they had under the US Constitution is returned to them. Obama and his leftist minions illegally usurped the power of healthcare from the exclusive authority of the States, and they are going to take that authority back. It was never a power intended for the federal government.
 
I think that claim was adjudicated back in the 1960’s.
No, it was not. The unconstitutional MediCare/MedicAid programs were never challenged to the Supreme Court and continue to be illegally implemented by the federal government, just like Social Security, to this day.

The irony here is if the federal government had not created MediCare/MedicAid in the first place, there would never had been a need to the Affordable Healthcare Act. The federal government caused the sky-rocketing medical costs and healthcare prices by paying only pennies on the dollar for MediCare/MedicAid services. Insurance companies had to make up those costs somewhere, so naturally they charged the consumer.

Had there been no illegal MediCare/MedicAid, there would have been no sky-rocketing medical/healthcare costs.
 
These are interesting related points. On the one hand you could imagine a public option that's more or less left to its own devices after being created, allowed and encouraged to make business decisions like any other insurer and without any special privileges for being publicly-sponsored. Then its value is really just in injecting another option in the marketplace. And since marketplaces with more insurers competing tend to have lower premiums, that's a worthy approach.

On the other hand, arguably one of they key reasons we want a public option anyway is so that underserved marketplaces/rating areas will have a new insurer. But these are by definition areas that most other insurers have found to be a poor business decision, perhaps because they can't match the provider prices the dominant (lone?) incumbent insurer has achieved. When various marketplaces/rating areas become more attractive business then we see market entrants, as we're seeing in many places this year and next, and don't necessarily need to create a new public one just to have another seller. And a public option with no local market share and no special leverage to get lower provider rates isn't going to be any more effective at entering or competing in those places than any other insurer faced with the same incentives.

So if we really want a public option that's going to venture in and sell in places where most insurers won't, and otherwise change the game, it seems like it needs some sort of pricing advantage (rate-setting ability) relative to incumbents, which may in turn require some kind of stick to require provider participation. But then you don't necessarily even need a new public insurer if that's the key, you can just require/allow existing private insurers to sell products that get to tack onto government rate-setting in some way. That's the route Washington has gone with its "public option" plans and it's what was on the table in Connecticut's proposed public option a couple years back before the proposal was scrapped.

Explain what you mean/how it works to require/allow existing insurers to tack onto government rate setting?

I’d be curious to see how a PO with pricing advantage would work in an area with a dominant or lone incumbent.
 
What a mess.

It's a good example of why socialist command economies always fail. Note also that this absurd agglomeration is only about paying for healthcare. Imagine what it would look like if the stupid, incompetent, corrupt government were actually providing the healthcare.

If you look at the graphic, it's all questions. So how will those questions be answered? They will be answered by politics, and when decisions are made by politics, the politically powerful tend to get their way.

Ain't democracy grand?

Your president had four years to come up with an alternative healthcare plan, including two years of Republican-controlled Congress. Where is it?
 
No, it was not. The unconstitutional MediCare/MedicAid programs were never challenged to the Supreme Court and continue to be illegally implemented by the federal government, just like Social Security, to this day.

The irony here is if the federal government had not created MediCare/MedicAid in the first place, there would never had been a need to the Affordable Healthcare Act. The federal government caused the sky-rocketing medical costs and healthcare prices by paying only pennies on the dollar for MediCare/MedicAid services. Insurance companies had to make up those costs somewhere, so naturally they charged the consumer.

Had there been no illegal MediCare/MedicAid, there would have been no sky-rocketing medical/healthcare costs.


BS.

That did not happen in any country that adopted a national health insurance plan.
 
BS.

That did not happen in any country that adopted a national health insurance plan.
Other countries do not limit the powers of their government. The US does.

Tenth Amendment of the US Constitution prohibits the federal government from exercising any power not specifically granted to them by the US Constitution. Healthcare is not a power granted to the federal government by the US Constitution. Therefore, they are prohibited from exercising that power.

All powers not granted to the federal government, and not prohibited to the States by the US Constitution, belong exclusively to either the States and/or the people, respectively. Since healthcare is not a power prohibited to the States by the US Constitution, the States have exclusive constitutional authority over all healthcare.

The same thing is also true with education. That is another power never granted to the federal government, and is exclusively reserved as a power of the States since it is not specifically prohibited to the States by the US Constitution.
 
The government insurance plan would wind up with all the worst cases. Far from breaking even, it would incur huge debt that the tax payers would have to pay.
It could! That depends in part on the design decisions that get made about it.

Explain what you mean/how it works to require/allow existing insurers to tack onto government rate setting?

I’d be curious to see how a PO with pricing advantage would work in an area with a dominant or lone incumbent.

There's different ways it could be done. They could just set a fee schedule for the PO (perhaps some multiple of Medicare's fee schedule) and let providers take it or leave it. Or they could leave rates up for negotiation but put a cap on what those rates can be, say somewhere south of the median commercial rate, which is what Washington did. Or they could do something like what Medicare Advantage does and put regulatory limits on balance billing and out-of-network rates to effectively lower the in-network prices that get negotiated.

As for what might happen, they could require participation for providers that participate in other federal programs, like Medicare, at least for some amount of startup time. If they don't do that, presumably a public option paying lower provider prices will have a smaller network than its local competitor(s) at first. But one lesson from the marketplaces so far is that many consumers will trade network breadth for lower premiums, which means it has some potential to pick up market share, which puts pressure on the incumbent to reel in its negotiated prices. And that's all you need out of a public option. It doesn't have to become the dominant insurer, it just needs to give consumers an option, a threat of defection. If that's enough to make complacent incumbents sweat and react, it's done its job. And if the public option isn't limited to just the individual market but is something that employers can choose to buy into (or if more of the employer market was otherwise unwound to get more people shopping in the marketplaces), it's all the more likely the impact could be material.
 
Very true, illegally. The majority of States are still suing to overturn the illegal law, and they will not stop until the authority they had under the US Constitution is returned to them. Obama and his leftist minions illegally usurped the power of healthcare from the exclusive authority of the States, and they are going to take that authority back. It was never a power intended for the federal government.
Who's suing on Tenth Amendment grounds?
 
Who's suing on Tenth Amendment grounds?
The 27 States that are suing the federal government to abolish the illegal Affordable Healthcare Act of 2010 and restore their constitutional authority, and the date they joined the suit, include:
  • Alabama - March 23, 2010
  • Alaska - April 20, 2010
  • Arizona - April 6, 2010
  • Colorado - March 23, 2010
  • Florida - March 23, 2010
  • Georgia - April 13, 2010
  • Idaho - March 23, 2010
  • Indiana - May14, 2010
  • Kansas - January 12, 2011
  • Louisiana - March 23, 2010
  • Maine - January 12, 2011
  • Michigan - March 23, 2010
  • Mississippi - May14, 2010
  • Nebraska - March 23, 2010
  • Nevada - May14, 2010
  • North Dakota - April 5, 2010
  • Ohio - January 11, 2011
  • Oklahoma - January 7, 2011
  • Pennsylvania - March 23, 2010
  • South Carolina - March 23, 2010
  • South Dakota - March 23, 2010
  • Texas - March 23, 2010
  • Utah - March 23, 2010
  • Virginia - March 23, 2010
  • Washington - March 23, 2010
  • Wisconsin - January 3, 2011
  • Wyoming - January 7, 2011
 
The 27 States that are suing the federal government to abolish the illegal Affordable Healthcare Act of 2010 and restore their constitutional authority, and the date they joined the suit, include:
  • Alabama - March 23, 2010
  • Alaska - April 20, 2010
  • Arizona - April 6, 2010
  • Colorado - March 23, 2010
  • Florida - March 23, 2010
  • Georgia - April 13, 2010
  • Idaho - March 23, 2010
  • Indiana - May14, 2010
  • Kansas - January 12, 2011
  • Louisiana - March 23, 2010
  • Maine - January 12, 2011
  • Michigan - March 23, 2010
  • Mississippi - May14, 2010
  • Nebraska - March 23, 2010
  • Nevada - May14, 2010
  • North Dakota - April 5, 2010
  • Ohio - January 11, 2011
  • Oklahoma - January 7, 2011
  • Pennsylvania - March 23, 2010
  • South Carolina - March 23, 2010
  • South Dakota - March 23, 2010
  • Texas - March 23, 2010
  • Utah - March 23, 2010
  • Virginia - March 23, 2010
  • Washington - March 23, 2010
  • Wisconsin - January 3, 2011
  • Wyoming - January 7, 2011

Looks like you're referencing a case that was decided by the SCOTUS nine years ago. Spoiler alert: the ACA survived.
 
Looks like you're referencing a case that was decided by the SCOTUS nine years ago. Spoiler alert: the ACA survived.
Incorrect. That was just one of multiple suits pending. The suit filed in US District Court in Texas in February 2018 is still pending.

20 States Sue Federal Government, Claiming Obamacare Is Unlawful

(Reuters) - A coalition of 20 U.S. states sued the federal government on Monday over Obamacare, claiming the law was no longer constitutional after the repeal last year of its requirement that people have health insurance or pay a fine.

...

“The U.S. Supreme Court already admitted that an individual mandate without a tax penalty is unconstitutional,” Paxton said in a statement. “With no remaining legitimate basis for the law, it is time that Americans are finally free from the stranglehold of Obamacare, once and for all,” he said.

The States will continue to bring the case back to the Supreme Court until the power that was illegally taken by Congress is finally returned. Congress simply does not have the constitutional authority to involve itself in our healthcare. Just like they have no constitutional authority to involve themselves in our education. Both are powers that belong exclusively to the States, not the federal government.
 
The States will continue to bring the case back to the Supreme Court until the power that was illegally taken by Congress is finally returned. Congress simply does not have the constitutional authority to involve itself in our healthcare.

A ruling that the individual mandate penalty has to be larger than $0 would not establish that Congress does not have the constitutional authority to involve itself in health care. None of those states have even challenged the feds' authority to regulate and subsidize health care markets They challenged the individual mandate instead and lost nine years ago. Now they’re after the individual mandate again based on a technicality of tax law.
 
A ruling that the individual mandate penalty has to be larger than $0 would not establish that Congress does not have the constitutional authority to involve itself in health care. None of those states have even challenged the feds' authority to regulate and subsidize health care markets They challenged the individual mandate instead and lost nine years ago. Now they’re after the individual mandate again based on a technicality of tax law.
That would be judicial activism, and not allowed. They are to merely review the existing law and determine whether or not the federal government was granted the specific power under the US Constitution. Judicial activism is an impeachable offense.
 
That would be judicial activism, and not allowed. They are to merely review the existing law and determine whether or not the federal government was granted the specific power under the US Constitution. Judicial activism is an impeachable offense.

This is pretty avoidant of the topic. It’s also a complaint you could repeat with regard to about a thousand other things the federal government does.
 
Rather than focus on all the political topics, the issue with single payer is always one basic issue...

Paying to meet expectations.

Look at the basic fact that the US market pays more than anyone else in the world for medical devices, treatments, and therapies and that those fat margins (compared to the rest of the world) are what largely fund new developments. Last I checked, most of the major pharma companies run net margins roughly equivalent to utilities, yet they are vilified as capitalist pigs. Get rid of them, or take their IP and let it be free, who spends the next couple billion dollars on developing a new treatment? When you look at the nations living on single payor networks, one of the things they really thrive on is by not adopting the newest technologies and advancements because they don't want to/can't pay for them. This results in treatment options that lag a generation or two behind what is often seen in the US. This is best exemplified in cancer treatments and survival rates.

If you want to look further, look at why so many of the most successful countries have hybrid plans (UK/Germany/etc) where there is a baseline state sponsored plan and private insurance on top of it. Those two healthcare systems are largely unrelated and entirely different qualities of care. Are you ok with that? Are you ok with the poor/middle class getting substandard medical care? Or to phrase another way, the rich getting better care? There is a reason, for instance, why the UK is seeing a *huge* growth in the number of people getting private insurance instead of NHS care. Effectively it boils down to consumerism, those buying private policies are doing so because they see a value in it.
 
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