The Democratic presidential candidates who are backing a healthcare “public option” or “buy-in” that would have the government offer medical coverage to compete with private insurers are offering it as a “pragmatic” alternative to “Medicare for All” — but it, too, will be a long shot.
Recent history illustrates the difficulty of enacting the plan. The public option was in an earlier draft of Obamacare, but it was defeated in 2009 by centrist members of the party. Since then, Democrats have viewed the buy-in as unfinished business on healthcare reform. They argue that a government-offered plan would help in places that have only one private insurer selling coverage, and that competition everywhere would help lower premiums.
“This was once seen as something that was mostly supported by the progressive wing of the Democratic Party, but this time around it’s the starting point for Democrats,” said Jacob Hacker, a Yale University political science professor sometimes called the “father of the public option.”
One factor attracting Democrats to a buy-in is that it’s voluntary and avoids the political risk involved in forcing people who are getting coverage from private insurers onto a government plan, as the Medicare for All Act from Sen. Bernie Sanders, I-Vt., would do. When polled in January about the possibility of letting more people enroll in a government plan similar to Medicare or Medicaid, the Kaiser Family Foundation found that roughly three-quarters of voters liked the idea.
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But lobby groups representing private insurers, drug companies, and even doctors and hospitals are mounting an attack against all proposals to let patients leave private plans for public ones. They argue that the public option is part of a slippery slope and that many politicians backing the plan eventually want to move to a fully government-financed healthcare system.
The public option would presumably pay less than private insurers for medical services — for hospital visits, a medical checkup, or prescription drugs — which means less money for the medical industry. Hospitals that are already struggling could be forced to close or deliver less care.
“Not only would provider payment cuts under such a system threaten patients’ access to their doctors, hospitals, and treatments along with their quality of care, but its unaffordable costs would be passed on to taxpayers as this government-run insurance system became unsustainable,” said Lauren Crawford Shaver, executive director of the Partnership for America’s Health Care Future.
It’s not clear whether Democrats will be able to coalesce behind one public option idea. They already have introduced at least five bills in the Senate that reflect the logistical differences a future Democratic president and Congress would have to consider.
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Former Democratic Texas Rep. Beto O’Rourke, for example, backs the Medicare for America Act, which would automatically enroll the uninsured and people who buy their own coverage into a government plan, while letting employers offer public plans to their workers.
Another plan would let people use Obamacare subsidies to enroll in Medicare instead of in a private plan, and another would allow for buying into Medicare at age 50. Yet another approach is to let states run a public option through Medicaid, the program low-income people use, rather than the Medicare program that now enrolls most seniors.
Sen. Amy Klobuchar, D-Minn., has co-sponsored several of these bills, while Sen. Michael Bennet, D-Colo., introduced one of his own. Former Vice President Joe Biden hasn’t specified which public option he backs. Several Democratic presidential candidates have co-sponsored both public options and the Medicare for All Act, including Sens. Elizabeth Warren of Massachusetts, Kamala Harris of California, Cory Booker of New Jersey, and Kirsten Gillibrand of New York.
“Not only are there many options, but the Democratic candidates for president are keeping their options open,” Hacker said, noting that even if a Democrat who favors Medicare for All secures victory, they would have fallback plans ready at their disposal if the government-only approach proves impossible.
[Related: Democrats set aside internal feud for first Medicare for All Act hearing]
Still, winning the White House doesn’t guarantee it will be possible to expand government plans. Even liberal states have failed to get their own proposals off the ground as they run into issues of financing and logistics. Many current state proposals would need authorization from Trump administration officials, as well as more federal funding.
Washington Gov. Jay Inslee, another Democratic presidential candidate, is expected to sign a bill into law that would make a public option available in his state beginning in 2021. The plan looks different than the ones in Congress because it will use private insurers.
The Washington bill won’t be finalized until this summer as lawmakers debate funding. The timing is advantageous for Inslee, who will be able to say on the campaign trail that he’s the only candidate to get a public option passed. At the same time, the plan won’t yet have gone into effect for people to evaluate whether it delivered on its promises to provide lower-cost coverage to Washingtonians.
Alexander Shekhdar, founder of Sycamore Creek Healthcare Advisors, predicted that, as in Washington, any buy-in that advances is going to be publicly financed and privately run. This means it would look similar to Medicare Advantage or Medicaid Managed Care.
“It’s not going to be a wholesale changeover where you get rid of the insurance industry,” Shekhdar said. “That’s not politically feasible and it’s not practically feasible.”
