Drawing a Line in the Sand: The Case for a Public Option

Health insurance reform excites passions across the political spectrum. In a broad sense, most reasonable parties agree on the basic goals of reform: improving the quality of care, making coverage more affordable for everyone, and preventing insurance companies from denying coverage to those who need it most.

But there is still wide disagreement about exactly how to realize these objectives.

After considering all of the serious options on the table, I am convinced that we can only achieve our goals by including a public option in any reform package. In fact, I would regard as inadequate any measure that fails to include a public option, and would vote against such a plan in the Senate.

The facts are these:

45,000 Americans die every year because they don’t have health insurance and cannot get quality care, according to a Harvard Medical School study. That’s one death every twelve minutes.

Rising healthcare costs are spiraling out of control. Over the past nine years, insurance premiums have more than doubled, increasing at a rate four times faster than wages. In the current economic climate, insurance costs and medical bills have forced far too many American families into bankruptcy. While we suffer, insurance corporations are posting record profits.

Over 400 insurance company mergers in the past decade have led to markets dominated by a small number of insurers. In Illinois, an American Medical Association study found that just two companies dominate 69% of the insurance market. As competition shrinks, profits skyrocket. If we compare 10 of the country’s largest insurers between 2000 and 2007, we discover that profits have increased by an average of 428% (based on information filed with the Securities and Exchange Commission). A public option would rein in these excessive revenues and would put pressure on companies to improve coverage or risk losing customers. Put simply, it would restore choice to the insurance industry.

It’s time to restore competition and accountability to the private insurance market. Under the current system, it’s impossible for small, private insurers and state-based co-ops to compete in the insurance marketplace. A nationally-administered public option, available in all fifty states, would have enough clout to compete with the corporate giants. This would allow millions of people to get health insurance for the first time, and at a reasonable price.

A public plan would improve health outcomes and provide stability and security, because it would allow those who change work, start a business, or lose their jobs to maintain quality, affordable coverage.

A public plan would set its premiums based on the market. Just like any other business, it would need to be initially capitalized, but would subsequently rely on the premiums it collects to remain self-sufficient, in accordance with explicit provisions in both the Senate and House proposals. The plan would also be subject to the same solvency requirements as other insurance companies.

A public option would complement our nation’s private insurers, not drive them out of business. All of the bills passed by the committees of jurisdiction in both the Senate and House of Representatives require increased employer responsibility in some form or another that would increase the number of people who receive private insurance from their job/place of work. The Congressional Budget Office has estimated this mandate could result in a net increase of 1-3 million people, while offering exemptions and tax credits to lessen the burden on small businesses.

I believe a public option must be a central component of any health insurance reform legislation. We need to restore competition and responsibility to the insurance market – principles upon which our nation’s economy was founded in the first place. Market alternatives will put real pressure on insurers to rein in profits, stop denying coverage to those who need it, and do the right thing for their customers.

On September 9, President Obama drew a line in the sand and asked members of Congress to choose a side. I choose to stand with the American people.

I hope that my colleagues will join with me in demanding nothing less than the real, meaningful reform a public option would provide. The stakes are too high to settle for anything less.