Igor Volsky writes about on a new report from the Urban Institute, which concludes that a trigger of a "strong" public option would work better than the current public option provisions in either bill. Igor:
The report says that the Senate and House’s public option provisions (which require the public plan to independently negotiate rates with providers) would have little hope of lowering costs in areas of the country with high provider concentration. In areas where hospitals have "too strong a market presence to be excluded from insurer networks," hospitals could dictate prices, stripping the public plan of its ability to negotiate cheaper rates, the report warns. According to a 2006 study, 86% "of large metropolitan areas were considered to have highly concentrated hospital markets."
Policy makers can overcome the political challenges of enacting strong public option — one which compels Medicare providers to participate and establishes Medicare-like reimbursement rates — by placing the plan behind a trigger mechanism which "would allow private insurers the opportunity to show that they can provide affordable coverage under the new health reform rules."
The report recognizes that "many proponents of a strong public option oppose a compromise relying on triggers because they believe that triggers would never be pulled" and suggests that structuring the trigger around overall growth in national health spending — rather than affordability — would make it more likely that a public plan would be established in the absence of meaningful cost containment.
The policy angle of this argument has been demonstrated. In fact, the robust public option that the Urban Institute is arguing is what the House progressives argued for because it would have resulted in the strongest reform.
What's baffling is that anyone could imagine that a trigger would be enough to mollify the opponents of a robust public option, particularly a trigger that was designed to actually work. The opponents of the public option want just don't want competition for the private insurance industry. Period. They don't want a public option that would work, and a trigger that might actually be pulled could allow that.
The Urban Institute might be right on the policy question here, but they are seriously misreading the politics of it. If there was the political will for a triggered robust public option, the robust public option would have survived in the House.