Senate Finance Panel Outlines Options For Public Health Plan
A Senate Finance Committee paper released Monday outlines
several divergent approaches to creating a public health insurance
option, including one modeled after Medicare and another that would
mimic private insurance companies.
Public plan proposals have taken center stage in debates over
writing health-care legislation in recent months, becoming
something of a partisan litmus test. The White House and
congressional Democrats favor the creation of a public plan, saying
it would force greater competition in private insurance markets,
while Republicans have expressed concern that it would undercut
An "options paper" released Monday by the finance panel outlines
two paths for a public plan option.
The first, a Medicare-like plan, would pay a rate based on
Medicare rates and increased by 0% to 10% and would require doctors
and hospitals that currently accept Medicare beneficiaries to
accept the new beneficiaries. It would be administered by the
Department of Health and Human Services and would not be required
to hold cash reserves - as most publicly traded companies are.
The second option presented by the committee would be separated
from HHS and instead run by regional administrators. The
administrators would create their own provider networks - instead
of adopting Medicare's network - and would have solvency standards
that would require them to hold reserve funds.
That option tracks closely with a proposal recently hashed out
by Sen. Charles Schumer, D-N.Y., who sits on the finance panel, and
is likely to have more support from moderates in the Senate who
maintain that a public plan should be on a "level playing field"
with private insurers.
"I think it's the only way a public plan could work," Sen.
Blanche Lincoln, D-Ark., said last week. Lincoln sits on the
Schumer's proposal has seen traction recently, with Sen. Arlen
Specter, D-Pa., stating in a May 8 letter to the advocacy group
Health Care for America Now that Schumer's plan could be a
"starting point" for discussions on a public plan.
A third option included in the paper would allow or require
states to create their own public plans, with the possibility of
states expanding state employee health plans to include
Alternatively, the finance paper suggests that the legislation
could forgo a public health insurance option and rely on private
insurers "in a reformed and well-regulated private market."
America's Health Insurance Plans, a trade group of insurers that
includes Aetna Inc. (AET), Humana Inc. (HUM), Cigna Corp. (CI) and
UnitedHealth Group Inc. (UNH), has expressed reservations about a
public plan option and instead suggested that major changes to the
health insurance market could resolve many problems for individuals
trying to purchase insurance.
-By Patrick Yoest, Dow Jones Newswires; 202-862-3554;