Here Comes The Cavalry On Health Care

The best part of today's press conference came when President Obama strongly defended the public plan on the policy merits, and questioned the intellectual honesty of his opponents.

OBAMA: Now, the public plan, I think, is an important tool to discipline insurance companies. What we've said is, under our proposal, let's have a system, the same way that federal employees do, same way that members of Congress do, where we call it an exchange, but you can call it a marketplace, where, essentially, you've got a whole bunch of different plans....As one of those options, for us to be able to say, here's a public option that's not profit-driven, that can keep down administrative costs, and that provides you good, quality care for a reasonable price as one of the options for you to choose, I think that makes sense.

QUESTION: Wouldn't that drive private insurance out of business?

OBAMA: Why would it drive private insurance out of business? If private insurers say that the marketplace provides the best quality health care; if they tell us that 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? That's not logical.

Now, the -- I think that there's going to be some healthy debates in Congress about the shape that this takes. I think there can be some legitimate concerns on the part of private insurers that if any public plan is simply being subsidized by taxpayers endlessly that over time they can't compete with the government just printing money, so there are going to be some I think legitimate debates to be had about how this private plan takes shape.

But just conceptually, the notion that all these insurance companies who say they're giving consumers the best possible deal, if they can't compete against a public plan as one option, with consumers making the decision what's the best deal, that defies logic, which is why I think you've seen in the polling data overwhelming support for a public plan.

You cannot make the argument that government-run health care would cause long lines and bureaucrats in charge of health decisions and also make the argument that such an undesirable outcome would BANKRUPT the private insurance market. Either a public plan sucks and nobody will use it, or it does not suck and everybody will use it. Make up your mind.

And with that, Democrats became more energized for this fight. While Obama did not draw a line in the sand on the public plan, he offered enough support to give space to Democrats to argue forcefully for it. Sen. Reid's office released this set of talking points today that sound similar to the President:

RHETORIC: Health Care Reform Will Decrease Competition, Limit Patient Choice. Republicans want Americans to believe that reforming health care will decrease competition in the health care marketplace and limit choice. Senator Alexander: "Well, putting a government-run and subsidized plan in competition with our private health insurance plans would be like putting an elephant in a room with some mice and saying: OK, guys and gals, compete. I think we know what would happen. The elephant would win the competition and the elephant would be your only remaining choice." In fact, the opposite is true - a public option and health care exchanges will lead to more competition in the marketplace. [Congressional Record, 6/16/09]

REALITY: Reforms Will Increase Competition by Increasing Choice. Right now, competition in the health care insurance industry is lacking. "A recent American Medical Association survey found that a single private health insurance company controlled more than half the market for insurance in 16 states and a third of the market in 38 states." By creating a national health insurance exchange, private and public health plans will directly compete for business and open up the marketplace. ["Competitive Health Care," Center for American Progress, 3/25/09]

To briefly explain the concept of a health insurance exchange, and the Urban Institute does it better than I do, the government would essentially bust the trusts that monopolize local markets by creating an exchange that would provide a wider menu of options. Obviously, fostering more competition will tend to lower costs. The same with a public option, one that can potentially deliver health care more efficiently and at better cost. A good private company will figure out how to compete with that, by lowering their own administrative costs. And because strong consumer protections would be inserted into the bill, insurers would not be able to get there through rescission and other immoral means.

(Incidentally, for those who think Jake Tapper caught Obama in a "gotcha" moment by asking a hypothetical about employers who go on the public plan and then change the health care of their employees, Obama's answer to that, as Jon Cohn notes, was fine. If we do nothing, employers will be doing a whole lot of "changing employee's health care" by dropping coverage entirely out of an inability to afford it.)

I'm starting to see a lot of activism around health care reform. Democrats and advocacy groups are tearing into Dianne Feinstein for intimating on CNN over the weekend that Democrats "don't have the votes" on reform. SEIU put together an amusing video rebutting conservative scaremongering. And Firedoglake is taking a whip count for the public option in the House, with the goal of finding enough House progressives to commit to "not vote for any health care bill that does not have a strong public plan," to upset the dynamic where the Ben Nelsons of the world have their say on the legislation.

We're still going to have a lot of hurdles, like terrible media reporting on the subject, conservative scaremongering and the disinclination of Democrats to deliver for their constituents. But people are moving in the right direction now.