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"Public Option": The Centrist Alternative to Government Control?


Jon Alter's latest column--calling for health care to be treated as a "civil right"--brings up an underdiscussed question: In a single payer plan, would health care be treated as a constitutional entitlement that couldn't be taken away without "due process" under the Warren Court's so-called "New Property" doctrine? My Con Law knowledge is a few decades out of date--but the doctrine covered welfare benefits, guaranteeing a hearing to individuals before they could be denied. Why not health benefits? ...

Isn't it possible, then, that rules produced by Orszag's cost-cutting IMAC board preferring some treatments over others, or some patients over others, would be hamstrung by constitutional proceduralism? Maybe sick patients who want disfavored Treatment X would sue and demand an individualized hearing before their "right" to that treatment could be denied.

And if the "New Property" operated to constitutionalize treatment rights in a single payer system, would the same doctrine apply to a so-called "public option" plan that competed with private plans in a health insurance "exchange"? If not, maybe a government-run "public option" would have an efficiency advantage over government-run single-payer. It wouldn't have to worry about all those hearings.

In fact, the more I think about the "public option" idea, the more it appeals to me--not because it's the "thin end of a wedge that will move the system" towards single payer, as Clive Crook summarizes it, but because it seems superior, in some respects, to single-payer.

1) Obama sells the "public option" as a way to "keep the private insurers honest." But the converse effect might be more important: the private insurers in the "exchange" would keep the "public" plan honest. Sure, in this marketplace the government plan will probably get the lion's share of customers. It will offer more security, for one thing. But if it starts to provide lousy service, or excludes too many treatments, the private plans might start to lure some of those customers away. Private insurers would provide an escape valve--an "exit"--unavailable in single-payer government monopoly. The obvious analogy is to private "charter" schools competing with public schools.

2) Likewise, if the public insurers managed succumbed to cost-bloat--if all the people who washed the laundry in hospitals became unionized, for example, and politicized government plans blithely passed the giant resulting bill on to their customers (not wanting to anger the SEIU and other good Dem supporters)-- the private sector might underbid the public plan and 'bend the cost curve' down! Again, that's something that probably wouldn't happen in a single payer scheme; and

3) As discussed, "public option" might help avoid having every "we won't pay for this treatment" decision become a constitutional issue in a way a universal, single-payer entitlement couldn't.

I'm not saying all the differences between the two sorts of plans would cut against single payer--some days it seems completely appropriate to handle treatment decisions as a constitutional matter, since lives are at stake. If a single payer plan is, as a result, less able to deny treatments, that could be a feature, not a bug.

I'm just saying the differences between the two forms of "government" plan have been blurred (mainly by the right), that some of those differences may favor the "public option," and that Obama may be missing a bet in failing to defend the "public option" by pushing off against government-run single payer plans of the left rather than by pushing off against the greedy, evil private insurance companies.

Triangulation--something that lets Obama seem a centrist--helps at this point, right? Or are voters worried that he's insufficiently fond of unchecked government dominance? ... 3:18 A.M.
Posted on 11/07/09, 01:11 am