CBO: Few Americans Would Sign Up For Public Health Insurance Plan

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The New York Times: "More and more, the Great Health Care Debate of 2009 is a numbers game. And the longer the debate goes on, the squishier the numbers seem to get. For months, many leading Democrats, including President Obama, have pushed for the creation of a government-run insurance plan to compete with private insurers. A main argument was that a public plan would save people money. It would not be under pressure to earn profits, pay high private-sector salaries or deny needed care." After the release last Thursday of the House Democratic leaders' health care bill, the Congressional Budget Office said "the public plan would cost more than private plans and only six million people would sign up" (Herszenhorn, 11/1).

The Associated Press: Coverage numbers regarding the Democrats' legislative push "for a government insurance plan to compete with private carriers are finally in: Two percent. That's the estimated share of Americans younger than 65 who'd sign up for the public option plan." That statistic "is raising questions about whether the government plan will be the iron-fisted competitor that private insurers warn will shut them down or a niche operator that becomes a haven for patients with health insurance horror stories." The CBO also said the plan would likely attract a "less healthy pool of enrollees" and would likely have premiums higher than the average for private plans (Alonso-Zaldivar, 11/1).

Kaiser Health News: The actual figure estimated to enroll in the public option would be about six million. "And that number could shrink because states may decide to opt out of a public insurance plan, an escape clause that's likely to be included in the Senate plan. ... The CBO reasoned that the plan may not be able to offer a price advantage - in part because the House bill requires a government-backed insurer to negotiate payment rates rather than dictate them to hospitals and doctors… If the number of people in the public plan turns out to be six million in 2019, that would work out to an average of 120,000 per state. But that number probably would be smaller in the smallest states, perhaps totaling just tens of thousands."

"Predicting the states' responses is tricky, even where Republicans and conservative Democrats predominate. Some say the consumer appeal of a public plan could trump criticism that government plans would eventually drive out competition and lead to the federalization of health care" (Pianin, Carey and Appleby, 11/1).

The Wall Street Journal reports that costs could be driven up in the public option because of increased utilization of services by public option enrollees and that the "payment rates the government negotiates with health-care providers would, on average, be comparable to those paid by private insurers, eliminating a cost-saving advantage many Democrats aimed to give the plan. The CBO says its findings aren't conclusive" (Adamy, 10/31).

This information was reprinted from kaiserhealthnews.org with kind permission from the Henry J. Kaiser Family Foundation. You can view the entire Kaiser Daily Health Policy Report, search the archives and sign up for email delivery at kaiserhealthnews.org.

© Henry J. Kaiser Family Foundation. All rights reserved.