Official: Health Care Reform Will Include Public Health Insurance Option

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Nancy-Ann DeParle discussing public health insurance
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White House Office of Health Reform Director Nancy-Ann DeParle, discussion public health insurance option, on Wednesday said she believes that lawmakers will be able to work together this year on a health care overhaul bill that includes a public health insurance option, the AP/Seattle Post-Intelligencer reports (Alonso-Zalidvar, AP/Seattle Post-Intelligencer, 4/15). DeParle -- who spoke at a briefing sponsored by the Kaiser Family Foundation, Families USA and the National Federation of Independent Business -- said, "I'm actually very hopeful that we'll be able to reach an agreement" on a public option, adding, "It is part of the president's plan, ... and the reason it's included is he wanted a mechanism to lower costs and keep the private sector honest by having a competitive public plan in there." She added that "there are different breeds of public plans that could be part of this," but that the main objective is "how do we make sure ... that people who are shopping for a health insurance plan and are looking at things that are low-cost and that are competitive and they have some choices" (Jacobson, "NewsHour with Jim Lehrer," PBS.org, 4/15).

Opponents of a government-run plan say it would leverage its size to pay less for care and offer discounted premiums, which could diminish the ability of private firms to compete for members (AP/Seattle Post-Intelligencer, 4/15). However, according to CQ HealthBeat, "Advocates of a public plan have increasingly talked about including safeguards to make sure such a plan would not compete with private insurers unfairly or simply dictate prices and take over the market" (Armstrong, CQ HealthBeat, 4/15).

DeParle said that "there are policy ways of getting around some of the objections that people raise" about public plans. "I think we can work together and have a public plan that people can agree to," but if "it is a philosophical debate," then that may be "another thing, and people may not be able to agree (Smith, Reuters, 4/15). She added, "It's been interesting to talk to people who say, 'Oh, I don't like a public plan.' When you actually start talking to them about what it might look like, you realize you're talking about two different things" ("NewsHour with Jim Lehrer," PBS.org, 4/15).

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According to DeParle, one compromise for a public plan could be to pay providers at the same rates as private plans, or a public plan could operate along the same rules as Medicare, which pays less for care than private plans. DeParle said that even if the public plan reimbursed providers at the same rate as private plans, it could achieve savings on administrative costs because it would not have to turn a profit (AP/Seattle Post-Intelligencer, 4/15). Another possibility she discussed would be to model the national plan after insurance plans that state governments offer to their employees, which typically cost less than individual plans but often are administered by private firms (Rubenstein, "Health Blog," Wall Street Journal, 4/15). She said President Obama has asked her to seek a bipartisan overhaul bill. (Reuters, 4/15).

Costs Of Health Care Reform
DeParle also discussed Obama's pledge to offset the cost of health care reform within 10 years. She said he "has serious concerns about any kind of financing" based on restricting the tax exemption for employer-sponsored health insurance coverage or "somehow undermining it," adding, "He's very skeptical of those plans and he's been clear about that." Senate Finance Committee Chair Max Baucus (D-Mont.) has said making such tax changes, which could generate hundreds of billions of dollars in savings, could be used to finance a potential overhaul (CQ HealthBeat, 4/15). DeParle added that "we are working with Congress on how this bill will be financed. A lot of it depends on the exact context of the bill they come up with."

Outlook On Public Health insurance
DeParle said she has met with lawmakers and their staff almost daily to develop overhaul legislation that would expand health insurance coverage to all U.S. residents (Edney, CongressDaily, 4/15). She said, "We're making a lot of progress in realizing the president's goal of getting health care reform enacted this year," adding, "All the groups who were on different sides of the table 15 years ago are now at the same table, working together and talking about how we can reach these goals." She said, "No one wants the status quo. They don't start off talking about their position, they talk about how do we get everyone covered, how do we lower costs for businesses and families."

In addition, she said, "Unlike the effort 15 years ago, Congress has put its money where its mouth is" on health reform, she said, citing lawmakers' inclusion of health provisions in the final budget resolution and work by committee chairs to get started on writing an overhaul bill (CQ HealthBeat, 4/15). She said, "This is very active, what is going on" (Budoff Brown, Politico, 4/15). "It's been, so far, a remarkably harmonious process," according to DeParle (CQ HealthBeat, 4/15).

By Kaisernetwork.org

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