Since when was a two-tiered health insurance system a Democratic policy goal?
Among Democrats in the Congress and at the White House there is a great deal of interest in creating a government-run health plan in the under-age-65 market. Such a plan would compete with the existing private health insurance market in a head-to-head showdown between private and public health insurance.
Such a plan was part of the President Obama's campaign health proposal—albeit limited to the small employer and individual market. We are told the President’s greatest interest here is in “keeping the private health insurance market honest.” That is, creating competition in order that private insurers do a better job of controlling costs.
While
most observers assume that this would mean paying providers at
Medicare—or even Medicaid—rates the administration says not necessarily.
The respected and non-partisan Lewin Group recently issued a report evaluating the idea, “The Cost and Coverage Impacts of a Public Plan: Alternative Design Options.”
It looks to me to be a credible job. They made the assumption providers
would be paid at Medicare rates—a logical conclusion if the objective
is lowering costs.
