The Alan Katz Health Care Reform Blog

Health Care Reform From One Person's Perspective

Senator Conrad’s Public Health Plan Compromise

Posted by Alan on June 10, 2009


For many Democrats, the benefits of a government-run health plan competing with private carriers in the individual and small group health insurance markets is simple: provide more choice to consumers and keep health insurance companies honest. Republicans and some moderate Democrats see the idea as the first giant step toward a government takeover of health care coverage fearing that a public plan would have an unfair advantage that would soon drive private carriers out of business. Both sides are gearing up for a tough and bruising battle over the issue. There will be many differences that will be hard to bridge during the health care reform debate. Whether the government should participate in the health insurance marketplace is, for now at least, the leading candidate to derail comprehensive reform.

Senate Kent Conrad, a Democrat from North Dakota, is seeking to prevent that from happening. According to the Associated Press, Senator Conrad is floating a compromise that would allow residents and small businesses in an area to crate non-profit health care cooperatives to offer health insurance. The idea is designed to appeal to Democrats based on the assumption that the co-ops would increase consumer choice and keep carriers honest. Because the co-ops would need to be self-supporting (the only government funding would be seed money designed to get them up and running) they would not have the unfair advantage against private health plans Republicans (and the insurance industry) fear.

The idea is getting a warm reception on Capital Hill. Senator Max Baucus, Chair of the Senate Finance Committee, said “the idea could be key to a bipartisan health bill,” according to the Associated Press. The AP quoted the ranking Republican on the Senate Finance Committee, Senator Charles Grassley, as saying “It’s got possibilities.”

Details concerning Senator Conrad’s compromise still need to be worked out. As those details emerge the proposal may serve as common ground for lawmakers working toward a bipartisan reform package. But those details have to satisfy some wary legislators. Reuters, for example, notes Senator Grassley’s insistence that “”any federal money used to set up what likely would be state and regional health cooperatives would have to be in the form of loans and that the government should have no role in their operation.” Meanwhile CNN describes the initial concern of Democratic Senator Charles Schumer that “co-ops might struggle to compete with big health-insurance companies and therefore would not help drive down costs.” However, Senator Schumer also said “he would see if they could craft a workable plan.”

Similar cooperatives have been set up to provide electrical services in rural areas. Would the concept would nationally for health insurance? That’s uncertain. Would health insurance co-ops serve the needs of Democrats without fulfilling the fears of Republicans?  Also uncertain.

In getting both sides to consider a middle way, however, Senator Conrad has made an important contribution to the health care reform effort.

4 Responses to “Senator Conrad’s Public Health Plan Compromise”

  1. Steven Gold said

    I have practice family medicine over a 30 year period about equally on both sides of the US Canada border. In addition, I have trained and served in the field of public or community health.

    The diseases are the same on both sides of the border. The cultures are similar. Only the delivery systems are different. Both suffer from the decoupling of the medical care system from the public health system. In bygone years, such decoupling did not exist. The local physicians were also the public health physicians. Upon evidence of epidemics of diarrhoeal disease in their communities, they petitioned the powers that be for sanitary water supplies. In the midst of our epidemic of nutritional disease, we have little such coupling at the local or “regional” level.

    What is missing in this debate is that the flattening of the projected curve of health care costs will require cultural change as well as intensified efforts at secondary and tertiary disease prevention. I suspect the French may have the # 1 health care system in the world not entirely due to the delivery system but also due to the fact the French culture is inherently more health promoting than the North American culture.

    The appeal of Senator Conrad’s plan is the local and independent nature of the “Regional Health Cooperative” entity. Much culture is local not national. There are a different set of buttons required to alter cultural patterns in Puget Sound, Washington than in the Foothills of North Carolina. The long term interest of the United States – the renaissance of this country, will depend on good stewardship of population health.

    Steven A Gold MD, MPH

  2. William said

    Dear Senator Conrad,

    Let’s be relaistic here. The Republicans are not going to support any solution that the Democrats propose. You have 59 votes and should be able to muster a majority. A republican filibuster over health care is not going to happen. Forget the compromise and get it done.

    Here are some other facts. The insurance companies fear the public option because they fear competition. The insurance companies have a cozy little antitrust exemption that allows them not to compete like other businesses. Lets be honest about, either we have a public option or the insurance companies give up their price fixing allowed by the McCarran Ferguson Act.

    The “shocking costs” of 1 trillion over 10 years should not shock anyone. As a Senator be honest about it. The Congress gave AIG – an Insurance Company – 200 BILLION DOLLARS in a period of THREE MONTHS! The Iraq War has cost well over a trillion dollars in five years and the People (other than defense contractors and Bush lackeys) have not benefitted at aall.

    Get off the fence! Stand with your Democratic President and Unify the Democratic Senators! Re-read JFK’s “Profiles in Courage.” Forget the compromise and go to war for the citizens who elected you rather than the few fat cat insurers that pay for the campaigns and parties and junkets!

  3. Ron Stone said

    While I’m not a fan of the government having its fingers in any private pie, we need to fix our health care system. Maybe a simpler idea would be to offer a double (2.5x the expense) deduction for companies offering health insurance to employees and cover the unemployed temporarily under some government sponsored plan. Sorry, I guess something this simple would never work.

  4. Alison said

    A wolf in sheeps clothing ?

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