Here’s a very good piece by Maggie Mahar of Health Beat titled The Public Option: It’s Not About Politics; It’s About the Economics of Reform. Mahar has remained optimistic that a public plan will make it into the final reform legislation — even when many liberal observers, myself included, considered the public option essentially dead. (Admittedly, the odds do seem better now that Senate Majority Leader Reid has come out in support). But even though Mahar and I may have disagreed on the odds of a public plan surviving this round of legislation, we both agree that a public plan is inevitable at some point because of the economics of healthcare. To quote Bogart as Rick, “Maybe not today, maybe not tomorrow, but someday soon and for the rest of your life.” My view — as I’ve stated before (see prior post)– is that eventually the U.S. will move to a highly regulated public-private insurance market or single-payer healthcare. Btw, Mahar is thoughtful, logical and thorough in her reporting on healthcare; be sure to put Health Beat on your favorites list.
Addition (Oct. 28, 2009; 3:31 p.m.): I just remembered, Paul Krugman makes a similar point in a post titled The Facts Have a Liberal Health-care Bias.
Serious students of health care have known for a long time that the magic of the marketplace doesn’t work in health care; the United States has the most privatized health-care system in the advanced world, and also the least efficient. The pale reflection of this reality in the current discussion is that reform with a strong public option is cheaper than reform without — which means that as we get closer to really doing something, rhetoric about socialism fades out, and that $100 billion or so in projected savings starts to look awfully attractive….It has also been clear from international evidence that universality is cheaper than leaving a few people expensively without care. That’s reflected now in the projected savings from a strong employer mandate. The point is that reality is pushing for a more progressive reform than the Baucus bill. Truly, the facts have a liberal bias.
Subscribe in RSS Reader
Corporate Research Group's Weblog 
The real question in reform is not how much is paid but who pays it. Pera WSJ analysis published earlier this week, the US actually spends fewer per capita pblic dollars on healthcare than the OECD average. Health reform will change that, probably with or without a public option due to Medicaid expansion, subsidies for private coverage etc. So what health reform is in reality is a massive cost shift from the private sector to the public sector at taxpayer expense. Since money is power, it follows that this is a massive power shift to the federal government, and a massive shift of political power to the left (vote for me or the conservatives will take your healthcare away).
Arguably the benefit is increased access, but for a relatively small sliver of the population. The fact is almost anyone who wants insurance can get it now–even the “uninsurable” can get insurance through state CHIP programs.
The alleged cost savings are likely to be chimerical. Powerful medical lobbies will see to that. The beneficiaries of the constant supplication will be politicians in the form of political contributions and other offerings to the new medical paymasters.