Serving the Medical-Industrial Complex

By Robert Parry
June 22, 2009
Consortium News

The usual knock on government programs is that they’re not as efficient as the private sector, which we’re told can provide the same product for less money and with higher quality. Thus, it should be no big deal when the public and private collide because the private sector should prevail.


However, in providing health insurance, those rules clearly don’t apply, which is why congressional Republicans and so-called “centrist” Democrats are going to such lengths to deny the American people access to a public option on health insurance.

Indeed, if a public option were to be piggybacked onto the existing Medicare bureaucracy, the chances for savings could be impressive for average Americans and the overall American economy.

Insurance middlemen could be eliminated; investigators who ferret out “preexisting conditions” wouldn’t be needed; doctors could save on administrative costs; the burden on U.S. industry providing health benefits could be reduced; and more money could be freed to cover the nearly 50 million uninsured or for actual doctoring.

For a nation facing multiple fiscal crises – all complicated by the costs of health care – one might think that the most sure thing in the health care debate would be to allow a cost-saving public option, which as President Barack Obama says would help keep private health insurers “honest” regarding their promises to trim waste and control premiums.

According to a New York Times/CBS poll, that point is obvious to 72 percent of the American people who favor “offering everyone a government administered health insurance plan like Medicare that would compete with private health insurance plans.”

It’s also reflected in a study cited by Sen. Chuck Grassley, R-Iowa, and other insurance industry defenders saying that 119 million Americans would bolt from their private insurers to the public option if they were given the chance.

To put that figure in perspective, it is about two-thirds of Americans who have private insurance through their employers or as individuals. In other words, the industry's defenders say two of every three customers want out.

Though some analysts doubt the defection rate would reach 119 million, Grassley’s argument is that Americans would so prefer a government-run plan that it would destroy the private insurance industry – and that therefore the public option simply can’t be permitted.

Grassley’s fear of 119 million Americans voting with their pocketbooks against private health insurance represents a remarkable admission of failure by the industry and its backers. It says, in effect, that the industry’s treatment of its customers has been so highhanded over the decades that the industry can only survive if Americans are left with the unappetizing choice of private coverage or no coverage.

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