Friday, September 4, 2009

Why Obama's healthcare bill should have a public option?

This is a very long reply I provided to someone who asked this question on Facebook. I apologize if you are reading this again.

Most of us (well, if you live in the U.S.) are very well covered by our employers, and so either we are indifferent to the ongoing discussions on healthcare reform bill, or we are just scared that any change in the status quo will affect us negatively. Please note that employment is not a permanent setup and you might find yourself in the open market to buy health insurance coverage if there would be a situation when no employer subsidized insurance will be available to you. Even for healthy individuals insurance premiums are high and every year that only goes up, and insurance companies try to spend lesser share of every dollar they take in as premium. The greedy providers on the consumption side of insurance dollars only worsen the problem. If you or your family member have a pre-existing condition you might not even be able to buy insurance coverage. People face such situations end up in bankruptcy as medical bills are too high to pay from your pocket (like it is still possible in countries like India) for middle class families. One of the main causes of bankruptcy in the U.S. is medical catastrophes in the family.

The cost of insurance has become a major issue for small businesses also. The rising cost of insurance forces them to shutdown and both owner and the employees lose their livelihood and health coverage. So, it badly affects the economy also, as the economic engine of the U.S. is not really large global corporations that are adept at getting around on not paying taxes, but the small businesses that are started by the ever enterprising regular Americans, and that is something GOP doesn't want to acknowledge though they act like the guardians of business interests. The fact is that they take money from insurance companies and want to kill the bill by scaring their dumb followers who simply don't realize that the healthcare reform is actually in their interest viewing it from any angle.

The retired, GOP loving grand parents protesting the bill on the curbs these days are already beneficiaries of the government run Medicare and I don't understand why they think another government run program for the rest of the public would be a bad idea. That's the power of GOP propaganda machine, or put simply, the tyranny of the minority, or the privileged, who can have things going both ways.

Obama's public option is supposed to compete with products offered by private insurance companies which would force the latter to clamp down on their share of profit taking. Also, insurance coverage will be available with less or no restrictions like the dreaded pre-existing condition. That's why a healthcare reform without the public option will not have much value. The government's intervention in the healthcare insurance market can tilt things in favor of government options and can eliminate healthcare insurance market in the private sector eventually. But that is a good thing. We are already doing that in areas of education, public transport, healthcare for seniors (Medicare),public security aka police, fire-force etc. and then why don't we implement that in healthcare sector which is another essential service for citizens.

I believe in the working of free market and its ability to bring good things for the consumers, but the market needs to regulated and government needs to be present in areas where essential services are offered to citizens. In other words, there are certain areas that should not be only defined by market variables, but the social factors and preferences should take precedence.

America is the only industrialized nation in the world that leaves so many of its citizens (about 50 million) without any kind of health coverage, and that is shameful for a country that has vast resources and bargaining power at its disposal, and it has no qualms in squandering that fortune in places like Iraq and Afghanistan. But, when it comes to protecting its own sick, the law makers simply squabble, conveniently forgetting the fact that their self-awarded health coverage is paid for by these same citizens whom they are supposed serve.


  1. I think healthcare reform is a topic in Us for last 15 something years(when Hilary came up with Universal Health care plan). I heard about it first through "SiCKO" by Micheal Moore.

    If you can put more pointers to discussions it will be lot more helpful.

  2. In a free market system, the consumer should have a choice, a bargaining power. Where is the bargaining power in health insurance in US? Just like I dont tie my car insurance to my job why should any insurance be? I dont like big Govts either, but I dont like big Insurance companies too breathing down my neck!

    Why is that gas costs 3$ and a copay for a simple antibiotic costs me $15?

    Why is that for the same premium of 300$ per month, the guy next door gets a poor insurance just cos my employer has more employees or is bigger? Where is the consumer justice in this?