In defense of the public health plan

House Democrats unveiled the first draft of their bill to overhaul the nation's ailing health care system last week. The most controversial proposal is the establishment of a government-run health insurance plan to compete with private health insurance plans.

Depending on whom you listen to, the plan is either a death knoll for the Americans' freedom or a savior for an out of control, costly health care system. Most likely, it is neither. Instead, it's a crucial step toward restructuring our complex, costly and ailing health care system. And it seems like the best solution -- or at least a necessary evil -- if we aim to insure all Americans and bring down costs.

Americans overwhelmingly agree. According to the latest New York Times poll, 72% of those surveyed support the idea of a public plan. Most Americans also said they'd be willing to pay higher taxes to ensure universal health care.

The goal of the plan is to offer an alternative to costly private plans, especially for people who don't have access to employer sponsored plans or can't afford to pay exorbitant rates for individual plans. A lengthy New York Times editorial on Sunday spelled out other benefits: "A public plan would have lower administrative expenses than private plans, no need to generate big profits, and stronger bargaining power to obtain discounts from providers. That should enable it to charge lower premiums than many private plans."

But the plan has pitfalls, including the little problem of figuring out how to pay for it -- which Democrats haven't addressed yet. And the plan has its critics, which include Republicans, insurance companies, pharmaceutical companies and the American Medical Association (AMA), to name a few.

However, as the New York Times pointed out in that same Sunday editorial, the charges against the public plan are "egregious mischaracterizations." For example, we've heard repeated charges that a public plan will result in a "government takeover" of health care resulting in a "socialized" medical system where care is "rationed." There's a reason you hear the same buzzwords repeated over and over by critics of the public plan -- to instill fear in Americans so that the public plan option will be derailed.

During an interview with George Stephanopoulos, Senator Lindsey Graham of South Carolina asked the question, "Do we want a bureaucrat standing between the patient and their doctor?" Perhaps Senator Graham is immune from the hassles facing most Americans who must deal with large, impersonal, bureaucratic insurance companies when their coverage is denied or they have a question about a bill. Such an out of touch comment reminds me of George Bush Sr.'s "aha" moment when he encountered a scanner in the grocery store.

As for complaints from insurance companies, there is some truth to the argument that private health care plans won't be able to compete with a public plan. If an employer has a choice between a quality private insurer like Anthem and the new government plan, and the latter is vastly cheaper, the employer will probably choose the less expensive option. Given the same choice, Americans may also choose the public plan because it's cheaper.

From a doctor's perspective, few will want to accept the government plan if it pays the same paltry rates as Medicare. Adding 5% to that, which is the current proposed compensation for doctors, isn't exactly attractive. Doctors in areas of the country where rents and malpractice run high don't accept Medicare and they may not accept Medicare plus 5%.

Take Anthem Blue Cross Blue shield, which pays $127 for a half hour gyn office visit, while Medicare pays $101, a 25% difference. I suspect that this is one of the details that will be negotiated to appease physicians, perhaps coming up with a payment structure that competes better with private plans. Something will have to give somewhere to make it work.

I think insurers have a tougher sell. In a press conference on Tuesday, President Obama said, "If private insurers say that the marketplace provides the best quality health care, if they tell us they're offering a good deal, then why is it that the government -- which they say can't run anything -- suddenly is going to drive them out of business." Paul Krugman put it more bluntly in his New York Times column: "Um, isn't the purpose of health care reform to protect American citizens, not insurance companies."

Lawmakers should keep that in mind in the coming months.

Russell Turk, M.D., is an obstetrican and gynecologist in Fairfield County, CT.
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