Gino DiCaro

Fed Update: Health care reform

By Gino DiCaro, VP, Communications

Capitol Update, Oct. 29, 2009 Share this on FacebookTweet thisEmail this to a friend

The U.S. Congressional health care debate took a troubling turn for employers this week when Senate Majority Leader Harry Reid announced he would include a “public option” in the legislation he plans to send to the Senate floor.

The National Association of Manufacturers (NAM) strongly supports health care reform that lowers costs and improves the quality of care. But a government-run, taxpayer-subsidized health care plan goes in the opposite direction, threatening the private coverage that manufacturers offer to their employees.
 
Whatever its flaws, the U.S. health care system is known for its high quality, innovative care – attributes a public option will undermine. Some have made unflattering comparisons to other government programs, calling the public option “the DMV for health care.” It’s certainly hard to see how adding even more government mandates and regulations would improve health care quality.
 
The likelihood of cost-shifting is also very disturbing. Premiums will increase because more people will be in plans that pay doctors and hospitals at lower, government rates, causing a shift in costs to private insurance payers. This cost-shifting means that manufacturers who continue to offer private insurance will face even higher premiums.
 
Subsidized by the taxpayers, a public option would either force private competitors to lower costs by cutting coverage or drive them out of the marketplace completely. It’s unlikely that you, as an employer, will be able to offer the same benefits you do now. In the end, it is employees who would feel the impact.
 

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