I think that it’s interesting in the current debate over health care that Republicans keep insisting that a government-run health care system would force private insurers out of business. Jon Greenbaum chimes in with a hugely salient point which is being lost in this whole conversation: if a government-run health insurance program would force private insurers out of business, what is different about the government-run pension system known as Social Security which makes it unable to force out it’s own private competition?
The difference, I might suggest, is none. And a public option for health insurance would likely have the same effect on that marketplace as Social Security has had on pensions: covering the uncovered, driving down costs and improving the quality of life for Americans across the board. After all, imagine how much more expensive life would be if your retired parents were dirt-poor with no means of income like 80% of pre-SS seniors.
The fact is, wherever there is a service provide, there is a Cadillac version rich people pay for. The same will be true of health insurance in a public option world. What will be different then and now is that insurers will need to provide services at prices which are reasonable, unless they want to confine themselves to being the over-priced, exclusive and much smaller solution to the very rich.