· No profit requirement
· No need for marketing
· Elimination of Underwriting
· Low Administrative overhead
· Elimination of competitive pressures
Essentially, because a national Medicare system has no need for many of the most costly activities associated with being an insurance company--administrative overhead goes way, way down.
Single payer is summary execution for the medical insurance industry. Here today—gone tomorrow. A hot bullet to the head.
Public Option
Public option is different. This is NOT single payer. It is the establishment of a federal health insurance company. Think Federal Reserve or FDIC.
Public Option represents death to the medical insurance industry—but it is a much slower death. Due to the slower death it may be politically doable where single payer is not.
Public option has a lot of the benefits of single payer, but is a corporate/government half breed. It will be much, much easier to render the public option weak and unattractive. Note: It would take another article to detail all the ways that Public Option could be diluted, co-opted, bankrupted etc.
Public option, like single payer, creates a huge risk pool. It should, since it will be a hybrid public/private non-profit with either very low or no underwriting standards, and should have many of the cost advantages of single payer.
It will not, however, be funded through payroll taxes. The individual or company (some of these details are not set yet) would sign up with this Public Option insurance company and directly pay for it with either payroll deduction or directly from their bank accounts. Both methods of payment are likely. Those that couldn’t cover the cost would have to get government subsidies.
Since this quasi-government entity is non-profit and should acquire a huge risk pool--administrative costs will be very low in comparison to private insurers.
(Note: You can view every article as one long page if you sign up as an Advocate Member, or higher).
1
1
1
