Roughly one-fifth of the people purchasing coverage through the exchanges would enroll in the public plan, meaning that total enrollment in that plan would be about 6 million.
That estimate of enrollment reflects CBO’s assessment that a public plan paying negotiated rates would attract a broad network of providers but would typically have premiums that are somewhat higher than the average premiums for the private plans in the exchanges. The rates the public plan pays to providers would, on average, probably be comparable to the rates paid by private insurers participating in the exchanges. The public plan would have lower administrative costs than those private plans but would probably engage in less management of utilization by its enrollees and attract a less healthy pool of enrollees.
In other words, now the public plan will cover fewer people than we thought before – and OMG – it might not contain costs.
Bob Cesca starts to fret, but consoles himself that it will all be OK because we have rules in place:
Now, as I take a deep breath, I hasten to note that this isn’t set in stone. Once the public option is passed into law, it will surely go through a variety of tweaks — filling in loopholes and closing gaps. Actually, it’ll probably go through further changes between now and final passage. I hope one of those changes is a clause to make sure the private insurers in the exchange can’t use the public option as a toilet.
Also, private insurers won’t be allowed to discriminate based upon pre-existing conditions, nor will they be able to engage in rescission. And there are guaranteed benefits and a risk adjustment apparatus in the exchange. It’s in the law. So it seems like the private insurers in the exchange would have to zero in on a very narrow loophole through which to dump sick and at-risk customers. And a loophole that small should be easy to repair.
No, Bob, we’ve had those rules in place before. They don’t work. Private insurance companies are very, very good at gaming the system.
As I’ve said before, a public option is NOT single-payer. It’s not a backdoor to single-payer. It’s a weak method to reduce cost. A weak public option isn’t much good at all. And that’s what people are fighting for?