1. 08:37 3rd Nov 2009

    comments:

    reblogged from: marc

    A public plan is likely to damage competition. A government insurer has some big advantages over a private one; its financing costs would be lower because the government can borrow cheaply; it would not have to worry too much about future liabilities since it could never go bust; and its economies of scale would be larger than those of the competition. Those using the public plan would benefit in the short term, but the scheme might very well squeeze private insurers out of business, which would be bad news for the other half of Americans that have them—and, according to opinion polls, are generally happy about that.
    — 

    American health reform: Back from the dead | The Economist (via marc)

    I call bullshit. In most states, private health insurance companies have no competition significant enough to keep prices down (particularly in the South). And if you are saying that, because the public plan costs will be so low that private insurers will go out of business, then you are also saying that everyone will have lower insurance costs because they will all switch to the public option or to new upstart businesses that can succeed at lower costs. That sounds like A Good Thing to me.

     
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