"I have described the “option” programs in the Senate Health, Education, Labor and Pensions (HELP) Committee bill and HR 3200 in previous papers.
The Senate HELP Committee “public option” will be multiple “options,” and these will be run by insurance companies
“Public option” advocates circle their wagons around two useless sentences in HR 3200
HR 3200’s “public option” will not resemble Medicare
As I demonstrated in those papers, there is no meaningful difference between the “options” in the two bills. Both bills use vague language and provide few details. Both authorize the Secretary of Health and Human Services (HHS) to hire corporations to set up insurance programs (“options”) that will sell health insurance to the non-elderly. The “options” will be available for sale to only a small percent of the population, namely, that portion which will be eligible to shop for insurance within one-stop-shopping centers called “exchanges” and which will be eligible for subsidies. Both bills call for an “option” program that will consist of numerous insurance companies, not a uniform national program like Medicare. Neither bill gives the Secretary the tools necessary to guarantee that these “option” insurance companies will survive in most markets, much less become large enough to influence the behavior of the insurers in their areas."
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"What accounts for this strange behavior, this willingness to see no problems in the “option” proposals and to see calamity in the co-op proposal? The explanation lies, at least in part, with the failure of the “option” movement’s leadership to acknowledge that the puny version of the “option” written up in the HELP Committee bill and HR 3200 does not resemble the large version originally proposed by Jacob Hacker.
The most important difference between Hacker’s original model and the version drafted by congressional Democrats is that Hacker solved or at minimum greatly reduced the start-up problem by pre-enrolling tens of millions of Americans in the “option” before it opened for business.
If “option” advocates had acknowledged this important difference and had discussed it publicly, obvious questions would have arisen, such as, If the “option” can’t be guaranteed a large customer base on day one as Hacker originally proposed, where will the customers come from, who will recruit them, and at what cost? But the very significant differences between Hacker’s original version of the “option” and the Democrats’ version were never acknowledged by the “option” movement’s leaders. In fact, leaders of the movement have aggravated their failure to discuss the watered down version of the “option” by routinely comparing that version to the highly successful Medicare program. This combination of tactics – the failure to acknowledge how weak the Democrats’ “option” is compared with Hacker’s original version, and the constant comparison to Medicare – induced sloppy thinking by leading “option” advocates. It induced them to project onto the co-op model the doubts they should be having about the “option.” It facilitated groupthink."
http://pnhp.org/blog/2009/09/29/there-is-very-little-difference-between-the-co-ops-and-the-%E2%80%9Cpublic-option%E2%80%9D/