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Life Health > Health Insurance > Health Insurance

Employer Group: Why Bother With The Public Option?

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The American Benefits Council says the country ought to focus on setting up a new health insurance distribution exchange system without taking on the added challenge of creating a government-run health plan.

The American Benefits Council, Washington, a group that represents the interests of large employers, has expressed that concern in a list of its members’ “priority issues” in connection with H.R. 3590, the Senate’s Patient Protection and Affordable Care Act bill.

The council also has created a chart that compares H.R. 3590 with the main House health bill, H.R. 3962, the Affordable Health Care for America Act.

James Klein, the council of the president, has written all senators to tell them what the council likes about the bill and what the council would like to see changed.

The council would like, for example, to see the Senate guard against adverse selection by rejecting a proposal developed by Sen. Ron Wyden, D-Ore., that would help some workers opt out of employer-sponsored health plans and buy coverage on their own.

The council also is urging the Senate to protect the Employee Retirement Income Security Act federal preemption of state benefits mandates; leave temporary and seasonal employees out of the “full-time employee” category; impose tough penalties on individuals who refuse to buy adequate health coverage; create a lower-cost, no-frills plan option, to ensure that individuals really can afford to buy coverage; and increase a proposed $2,500 cap on flexible spending account contributions and index the cap for inflation.

In a section on a proposed government-run “public option” alternative to health plans sold by private insurers, the council contends that setting up the proposed health exchange system would be ambitious enough.

“Transitioning from the market rules in place today to a reformed market with new insurance exchanges available in every state is a dramatic and positive change in current practices,” the council says in the list of priority issues. “Achieving a reformed and well regulated private market is essential and should be a central focus of health care reform. This core element of health reform will be challenging enough without attempting to introduce public plan options that risk destabilizing the insurance market at the same time it will be undergoing significant change and meeting demanding new standards.”

If the public plan operates under a special set of rules, it will clearly have an unfair advantage, and, if it does not, “then it is not needed at all, especially when the government will have many other responsibilities to ensure that health reform is implemented appropriately,” the council says.

“We continue to believe that fundamental health reform is essential,” Klein writes. “But it must be done right.”


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