Feature Story

June 25, 2009

Why a public health insurance option is key to saving costs

From Economic Policy Institute:

Recent estimates of the high cost of reforming the health care system leave out one critical detail: If the reform included a strong public health care option, it could actually save trillions of dollars over time, while also providing universal coverage.

The Congressional Budget Office, which has attached a massive price tag to health care reform, based its findings on incomplete proposals from the Senate Health, Education, Labor and Pension (HELP) and Finance Committees, leading many to argue that reform efforts must be abandoned or scaled back. Neither of those proposals includes the creation of a public plan.

While a public plan would indeed likely raise the level of federal government health spending, it is just as likely to reduce total national health spending. Independent research evaluating proposals produced by EPI and other sources has consistently found that a public plan would save money and result in better health outcomes by providing all Americans regular access to health care. Trying to minimize the government’s investment in health reform does nothing but erode the opportunity for true cost-savings in the American health care sector. This is almost the very definition of penny-wise, pound-foolish.

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