WHAT IT IS: A health insurance program run by the government. Individuals or employers would buy the insurance -- just as they might buy private insurance -- and use it to pay for care by their own doctors, or for services in hospitals, clinics, labs. The plan would cover the same package of services that private insurance plans would be required to cover in most of the bills being considered now.
The opportunity to participate in the public insurance option will expand during the first few years of health reform. In 2013, the public plan and other plans in the health insurance exchange would be open to all individuals without insurance and to small employers with fewer than 25 employees. The next year, employers with up to 50 employees can particpate, and the following year, employers with 100 employees can participate. After that, participation can be opened up to all sizes of employers, placing the public insurance option access on a level playing field with private insurers.
WHAT IT ISN'T: It isn't a government health care system, like the Veteran's Administration or the system in Britain. It isn't a public clinic. It has nothing to do with government-employed doctors or government-run hospitals; the care is provided through all the usual providers. The public insurance option just handles the finances.
It also isn't "free" or government-paid health care. Premiums would be sold to participants, the same as premiums for private health insurance. In the House bill, the public plan is required to become self-sufficient; it will be required to pay back a $2 billion start-up fund, and is prohibited from receiving any bail-outs.
FCNL'S POSITION: FCNL strongly favors a public option. A strong public option could offer a reasonably priced choice to people who have not been able to afford private health insurance. By being in the marketplace, the public option would compete favorably with private insurance plans, which would encourage improvements in both price and quality of service in all insurance plans.
OPPOSITION: The insurance companies have opposed the public option, claiming that it would drive them out of business. They are probably correct that a successful public option would dampen their profits; but the companies who offer a quality product at a reasonable price, and compete well on the basis of customer service and innovation, will always have customers. In addition, by requiring all employers to offer health care, and requiring all individuals to buy health care, the government will massively expand the potential customer base for all insurance companies.
