'Public Option' Pales Next to Single Payer

The following remarks were delivered to a closed-door meeting the
Congressional Progressive Caucus on June 4, 2009:

Today the Congressional Progressive Caucus faces a choice. That choice
is whether Members should maintain their unflinching support for
single-payer, or to accede to intense political pressure to support
the plan currently being developed in Congress under the direction of
President Obama: a mandate for Americans to purchase an insurance plan
from a massive new regulatory "exchange," with one plan potentially
being a "public option."

The difference between these choices could not be more stark:
single-payer has at its core the elimination of U.S.-style private
insurance, using huge administrative savings and inherent cost control
mechanisms to provide comprehensive, sustainable universal coverage.

The "public option" preserves all of the systemic defects inherent in
reliance on a patchwork of private insurance companies to finance
health care, a system which has been a miserable failure both in
providing health coverage and controlling costs.

Elimination of U.S.-style private insurance has been a prerequisite to
the achievement of universal health care in every other industrialized
country in the world. In contrast, public program expansions coupled
with mandates have failed everywhere they've been tried, both
domestically and internationally.

Many progressives accept that the "public option" is inferior to a
single-payer system, yet support it because of its perceived political
expedience. It is my aim today to convince you that the "public
option" program currently being developed is not only bad health
policy, but bad health politics.

On two separate occasions last month, physicians and nurses were
dragged from the Senate Finance Committee in handcuffs for demanding
that single-payer be considered in our nation's health reform debate.
These were American doctors and nurses, people who care for patients,
people who want to practice medicine, not protest and disrupt
Congress.

But these professionals risked their careers and their freedom. They
did this not because they thought that the "public option" was "good"
and single-payer "better." They did it because they are firmly
convinced, by well-established health policy science, that the
so-called "public option" has no hope of remedying the systemic
defects that cause their patients to suffer and die, sometimes before
their very eyes.

Millions of dollars have been spent by political advocacy groups to
commission polls and statistics "proving" that their health reform is
"politically feasible." Yet political winds do not make good health
policy. Careful examination of science and experience do. And it is in
the science and experience that we see that single-payer offers the
only way to truly comprehensive, universal and sustainable health
care, and that "public option" schemes offer only more of the same:
tens of millions of uninsured, rapidly deteriorating coverage, an
epidemic of medical bankruptcy, and skyrocketing costs that will
eventually cripple the system.

First, because the "public option" is built around the retention of
private insurance companies, it is unable - in contrast to
single-payer - to recapture the $400 billion in administrative waste
that private insurers currently generate in their drive to fight
claims, issue denials and screen out the sick. A single-payer system
would redirect these huge savings back into the system, requiring no
net increase in health spending.

In contrast, the "public option" will require huge new sources of
revenue, currently estimated at around $1 trillion over the next
decade. Rather than cutting this bloat, the public option adds yet
another layer of useless and complicated bureaucracy in the form of an
"exchange," which serves no useful function other than to police and
broker private insurance companies.

Second, because the "public option" fails to contain the cost control
mechanism inherent in single-payer, such as global budgeting, bulk
purchasing and planned capital expenditures, any gains in coverage
will quickly be erased as costs skyrocket and government is forced to
choose between raising revenue and cutting benefits.

Third, because of this inability to control costs or realize
administrative savings, the coverage and benefits that can be offered
will be of the same type currently offered by private carriers, which
cause millions of insured Americans to go without needed care due to
costs and have led to an epidemic of medical bankruptcies.

Supporters of incremental reform once again promise us universal
coverage without structural reform, but we've heard this promise
dozens of times before.

Virtually all of the reforms being floated by President Obama and
other centrist Democrats have been tried, and have failed repeatedly.
Plans that combined mandates to purchase coverage with Medicaid
expansions fell apart in Massachusetts (1988), Oregon (1992), and
Washington state (1993); the latest iteration (Massachusetts, 2006) is
already stumbling, with uninsurance again rising and costs soaring.
Tennessee's experiment with a massive Medicaid expansion and a public
plan option worked - for one year, until rising costs sank it.

The Federal Employee Health Benefit Program (the model for a health
insurance exchange) leaves hundreds of thousands of federal workers
uninsured, and has proven unable to contain costs.

Negative results in a recent series of randomized trials explodes the
hope that chronic disease management will cut costs. And the CBO has
thrown a wet blanket on the notion that electronic medical records
save money.

As Drs. David Himmelstein and Steffie Woolhandler, co-founders of
Physicians for a National Health Program, have remarked, a public plan
option does not lead toward single-payer, but toward the segregation
of patients, with profitable ones in private plans and unprofitable
ones in the public plan. A quarter-century of experience with
public/private competition in the Medicare program demonstrates that
the private plans will not allow a level playing field. Despite strict
regulation, private insurers have successfully cherry-picked healthier
seniors, and have exploited regional health spending differences to
their advantage. They have progressively undermined the public plan -
which started as a single-payer system for seniors and have now become
a funding mechanism for HMOs - and a place to dump the unprofitably
ill.

Progressive supporters of the "public option" readily concede that
single-payer is a superior system. Indeed, their response to evidence
that their plan won't work is to commission more charts and graphs
emphasizing its political feasibility.

The "public option" is truly the embodiment of health policy designed
by sound bytes, cobbled together from snippets of information gathered
from focus groups and public opinion polls, and centered around
well-polling buzzwords such as "choice" and "shared responsibility."

Such a plan may be enough to excite the political classes in
Washington, who care more about what they think can pass the Congress
than what will actually deliver universal, comprehensive health care
for all. But doctors and nurses, the people who actually work in the
health system, see right through it. They are going to jail because
they know that this plan won't work for their patients.

Nobody is going to jail for the "public option," because the American
people cannot be inspired by band-aids and half-measures it is
impossible to believe in.

These doctors and nurses are the manifestation of a social movement,
millions strong, that is waiting to be mobilized by the leadership of
the Members in this room. Polls consistently show that two-thirds of
the American people want single-payer. At a recent hearing in Montana
convened by Sen. Max Baucus, only 10 people of three hundred said they
were happy with the insurance they have. Sixty percent of physicians
support single-payer, as do the U.S. Conference of Mayors and 39 state
labor federations and hundreds of local unions across the country.

We're told that holding out for single-payer is politically unwise,
but to compromise and accept a bad plan at precisely the time when
popular support and grassroots energy are on the side of true reform
is the real political miscalculation.

The history of great social achievement is rife with instances in
which the forces of institutionalized power told social movements - as
they now tell this one - that what they wanted was too much, or too
fast, or too soon. I think, of course, of the abolition of human
slavery, the enfranchisement of women, the Civil Rights Movement,
Social Security, the minimum wage, an end to child labor. In each of
these instances, social movements held fast to their principles and
soon discovered that they had been told was "politically unfeasible"
one moment was political reality the next.

We currently have a better chance to pass single-payer than Lyndon
Johnson had when he passed Medicare. Unlike the public option,
single-payer - because it holds the potential to finally realize
universal, equitable health care - can be a vehicle to inspire the
American people for progressive change.

The voices of doctors and nurses can achieve extraordinary resonance
when they speak selflessly in their patients' interest. But your
leadership is crucial to inspire the American people. It is my hope
that you'll see fit to provide it.