Government & Politics

Resurrecting ObamaCare's 'Public Option'

The law is failing by design. Now Democrats are pushing for more.

Allyne Caan · Jul. 14, 2016

Remember the early days of the ObamaCare debate, when many of us warned the Democrats’ health care overhaul was the first step toward a single-payer system? Just as we predicted, leftists, including presumptive Democrat presidential nominee Hillary Clinton, once again have taken up the banner of the so-called “public option,” which is little more than a Trojan horse for single-payer health care. As predictable as each sunrise, Democrats always aim to expand government.

The Journal of the American Medical Association (JAMA) recently published an article bylined Barack Obama, in which he revives the call for a public option: “[B]ased on experience with the ACA, I think Congress should revisit a public plan to compete alongside private insurers in areas of the country where competition is limited. Adding a public plan in such areas would strengthen the Marketplace approach, giving consumers more affordable options while also creating savings for the federal government.”

Clearly, JAMA’s peer-review standards have plummeted, as this statement was obviously written by either a professional prevaricator or a stand-up comedian.

For starters, Obama all but admits his signature health care law is a flop, as “based on experience” he now claims we need a public option. As Reason’s Peter Suderman notes, “[T]he article … serves as a tacit admission that the law is not working as intended. … Naturally, it proposes further government intervention in the health care sector.”

Point taken, though we’d argue the law is working exactly as intended. Democrats just lied about their intentions.

Another howler is Obama’s punchline about how the public option would “compete alongside” private insurance, as if the government is just another capitalist enterprise in a free market. “Consumers do better when there is choice and competition,” Obama sagaciously explained. “That’s how the market works.” As if he’s the greatest free-market economist since Milton Freidman.

One of ObamaCare’s many lies was that it would improve competition in the individual insurance market. To sell this point, Obama pointed to the 34 states in which “75% of the insurance market is controlled by five or fewer companies.”

Insurance exchanges were supposed to be the grand savior of competition. They proved quite the opposite, as insurers have continued to pull out of exchanges. Suderman explains, “What this means is that in many rural areas, Obamacare’s exchanges will be served by one and only one insurer.” Wasn’t this one of the problems Obama promised to solve?

But never fear, statists have a plan to fix their failed government program. Another government program! If only we had a public option, Obama opines, it could “compete alongside private insurers” in places where competition is limited.

Of course, the government already tried a quasi-public option that, predictably, flopped. When the full-scale public option was rejected during the original ObamaCare debates, lawmakers set up pilot-program public options, or “co-ops.” These co-ops received billions of federal tax dollars and were supposed to operate just like regular insurance companies, compete alongside private insurers, and become self-sufficient. Yet of the 23 co-ops created, 16 have closed. As Americans for Tax Reform explains, “Co-ops across the country have struggled to operate in Obamacare exchanges, losing millions despite receiving enormous government subsidies.”

This makes even more ludicrous Obama’s claim that a public option would “create savings for the federal government.” Again, as Suderman notes, given the co-ops failures, “[t]here is little reason to believe that a full-fledged public option, entirely run by the government, would fare any better.” Instead, he correctly argues, it would be “much harder to shut down, and much more likely to be propped up by additional federal funding if it failed to completely cover its expenses on its own.”

And as for competition, even pretending that’s a goal is absurd. As The Wall Street Journal observes, “Mr. Obama is re-endorsing what he had hoped in 2010 would be a way station for government-run single payer that would gradually wipe out anything resembling private insurance. Insurers can’t outbid a ‘free’ program that is open to all or most and has the unlimited access to the Treasury that Medicare enjoys. A market exodus would be inevitable.”

A single-payer system was the goal all along. ObamaCare was never about health care; it was always about control. And Obama’s obsession with fundamentally transforming America won’t be satisfied as long as any semblance of Liberty or constitutionally limited government remains.

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