Opinion
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Switch to Public Option attracts Pelosi-backed businesses
By: David Freddoso
Commentary Staff Writer
07/18/09 9:24 AM EDT
Three companies in which House Speaker Nancy Pelosi, D-Calif., and her husband are heavily invested say they might switch their employees to a government-run Public Option plan if President Obama's health care reform passes Congress.
The Public Option is a proposed government-run insurance company that Obama, Pelosi, and most Democrats want to create as part of health care reform. It would receive a large start-up investment from taxpayers and likely pay low Medicare rates to doctors and hospitals, allowing it to undercut private insurers with low premiums. A Lewin Group study found that as many as 131 million Americans would move or be shifted involuntarily into such a plan if it is offered, possibly killing off the private health insurance industry.
Obama has promised repeatedly that Americans will be able keep their present health insurance if they want to, and a Pew poll found that 89 percent of insured Americans are happy with their existing coverage. But most health insurance plans are selected by employers, not employees, so the latter will have very little say if Obama's plan prompts employers to change it.
The Examiner contacted three businesses in which the Pelosis are heavily invested, according to her congressional disclosure forms. All three said that they would certainly consider switching employees to the Public Option plan, and in some cases would probably do so, provided that it is cheaper and offers roughly comparable coverage on paper.
The Public Option is a proposed government-run insurance company that Obama, Pelosi, and most Democrats want to create as part of health care reform. It would receive a large start-up investment from taxpayers and likely pay low Medicare rates to doctors and hospitals, allowing it to undercut private insurers with low premiums. A Lewin Group study found that as many as 131 million Americans would move or be shifted involuntarily into such a plan if it is offered, possibly killing off the private health insurance industry.
Obama has promised repeatedly that Americans will be able keep their present health insurance if they want to, and a Pew poll found that 89 percent of insured Americans are happy with their existing coverage. But most health insurance plans are selected by employers, not employees, so the latter will have very little say if Obama's plan prompts employers to change it.
The Examiner contacted three businesses in which the Pelosis are heavily invested, according to her congressional disclosure forms. All three said that they would certainly consider switching employees to the Public Option plan, and in some cases would probably do so, provided that it is cheaper and offers roughly comparable coverage on paper.
The Pelosis have an investment greater than $250,000 in The El Dorado Hotel in Sonoma, California. The hotel's general manager, Jen Hoj, said the company would be likely to switch its employees' insurance plan to a government option if it is cheaper, provided that the coverage appears to be comparable. "If it was less expensive, I imagine they would, yes," he said.
The Pelosis invested more than half a million dollars in the Massachusetts-based car company, City Car Services. Its CEO, Chris Wolfington, said that it would not be a hard decision to switch his employees over to a cheaper government plan.
Wolfington, whose firm employs about 250 people, described his company's present health care benefit as a "recruiting tool," noting that it attracts more "professional and mature" employees than those who would take a job without health care. "We didn't have it as recently as two years ago," he said.
"I think we'd have to wait for the details of the plan to emerge," said Heidi Darling, spokeswoman for the Piatti Restaurant, in which the Pelosis have a stake greater than $1 million. Piatti currently offers health coverage to all of its employees who work at least 24 hours per week. "We'd look at the details, weigh the options, and consider it."
"I think we'd have to wait for the details of the plan to emerge," said Heidi Darling, spokeswoman for the Piatti Restaurant, in which the Pelosis have a stake greater than $1 million. Piatti currently offers health coverage to all of its employees who work at least 24 hours per week. "We'd look at the details, weigh the options, and consider it."
Experience suggests that there are potential drawbacks to a public option plan, even if it is cheaper at first. For example, it could begin with generous benefits which are later scaled back when the plan is discovered to be fiscally unsustainable. It could begin with low premiums which are later hiked dramatically, after private insurance options have disappeared. This is exactly what has happened with Maine's public option health insurance plan, DirigoChoice.
But aside from the question of the public option's merits, if these Pelosi-invested companies provide a representative sample, employees should be prepared to have their health insurance change -- whether they want it to or not.
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