APublic Option in the Healthcare Market Place
APublic Option in the Healthcare Market Place
Theissue of public option is a policy for avoiding diseases, sustaininghealth, and bettering lives through organized strategies and informeddecisions. It centers on risks facing the general public and mandatesto control rather than treat diseases. A public option does thisthrough investigations and campaigns regarding healthy behaviors.Additionally, it focuses on better ways of handling infectionswhenever they erupt (Jones, 2014). The purpose of public healthinsurance in enhancing lives through disease deterrence and treatmentcannot be disregarded. This paper clarifies the reasons that make apublic option the best program that can ever be introduced into thehealthcare market place.
Therecords of the American bureau of statistics show that 16 percent ofthe citizens are presently uncovered. Other statistics indicate thata significant amount of taxpayer’s money is used in health mattersthan in any other element that affects the public. Due to the costlynature of medical care, the United States has one of the highest percapita expenditures when it comes to public healthcare. The sad partis that almost 46.3 percent of bankruptcy cases arise from medicaldebts. The state of economic deficit, as a result of the highmedical costs, leads to the rise in the population of underinsuredand uninsured (Jones, 2014).
Besides,the U.S. has been marked as the only developed country that does notcare if the citizens have public or private health coverage. The lackof health assurance leads to an average of 17,000 deaths on an annualbasis (Jones, 2014). From these statistics, there is a highprobability that the introduction of the public health into themarket place would lead to the shift of costs to the previouslydominant private insurers. As a result, organizations would beobliged to drop the private insurance firms in favor of the publicplan. Despite the fact that the public health cover would rival withthe private insurance, there is an empirical proof that the lowerpayment rates of the public option would move costs to the side ofprivate insurers.
Howthe Public Health will benefit Employment Sector
Therehave been questions regarding whether the public option would meanthat the medical practitioners would be forced to take part in itsrealization. However, no one is yet to be affected by the program.There is no means by which the new plan will make physicians to toilfor less salary. At national levels, the increased overall healthcarespending posed by the new system is going to be beneficial since itwill create work for a majority of healthcare specialists. It willlead to increases in earnings for a majority of health careemployees, expansion in local levy proceeds, and increase in demandsfor hospital services (Jones, 2014).
Moreover,the public option premiums plans are likely going to be lower thanwhat is currently experienced in the market. The public optionoperates almost in the same manner as Medicare because it also allowseveryone, irrespective of age, to purchase health cover from thegovernment. Because the Federal government will be involved, thepublic officials would help in regulating and negotiating what thecitizens need to pay for health care (Jones, 2014). The public optionis a program that increases overall healthcare spending hence reducesthe medical care expenditures for individuals.
Asthe healthcare sector gains a larger portion of the Gross DomesticProduct, employments as well as other health related activitiesequally grow. The area of health employs more than 6 millionphysicians and technical employees and close to 3 million Americanswork as care support teams. Therefore, the health sector is anessential basis of employment for most of the Americans. The U.S.clinics account for more than $1.2 trillion in annual economicactivities. Hospitals take up 4-13 percent of the country’semployment (Jones, 2014). From this, it is apparent that whilehealthcare prices appear as a significant burden to the Americanadministration, the costs represent a major financial asset andprospective leverage for boosting wages and job growth. Important tonote is that increase in total spending leads to improvedinterpersonal transfer of capital from the young to old segmentswithin the population.
PublicOption is a good way to fix the Health Cover Marketplace
Thedeclaration that the government will have new ways of trading healthinsurance through public exchange is not a loss to the renownedAffordable Care Act. However, it is certainly good news for thecurrent administration because it safeguards the country’shealthcare laws. Being that the Obama care Act has been associatedwith substantial flaws, the public option gives Americans new hopethrough its ability to cater for everyone regardless of their agesor salaries. More than 25 million citizens are yet to have healthcoverage as a result of the new plans.
Evenafter being regulated by the High Court, the developments in Medicaidhave made it possible for many poor citizens to have easy access tohealth care. Besides, it is believed that Obama’s parting frompower may trigger more regions to adopt the public option. Despitethe challenges of the ACA in the insurance marketplace, the publichealth insurance will provide coverage to multitudes that wereinitially locked out of the indemnity market (Jones, 2014).Similarly, it will make health cover plans less costly and better.
Creatingan environment for a public option to be in operation would ensurethat the affordable cover is accessible for many states and avoidprivate institutions from exploiting the citizens. In a case thatprivate companies will avail insurance that residents have alwayswished for, then people will realize what makes public option themost attractive plan (Jones, 2014). Unfortunately, this has been thedream of many Americans for decades and may not occur any soon. Beingthat the private insurers have been unable to act according topeople’s desires, it will be possible for the public health optionto take up a larger share of the case market. It is because of thisthat the ACA will also progress.
Availingthe public option makes sense irrespective of the country’sturbulent economy. It is the case because this form of indemnitywould ensure that an effective public insurance becomes available tomany individuals. Essentially, it would, to some extent, indirectlyreinforce health exchange programs by the coverage packages that aremodern and better. Advocates for a public option hold that it willmake insurance more reasonably priced. In turn, people will buybetter health care packages for lesser funds. The group believes thatgovernmental expenditures, for matters such as advertising,promotion, and retention, would be reduced through a public option(Jones, 2014).
Supportersof this plan also note that its charges are considerably less thanthe ones for Medicare. To some extent, this difference is because thepublic proposal would generate revenues for stakeholders just thesame way it occurs in private insurance. A cost comparison betweenthe public option and private insurance indicates that the former hasthe potential to save much money than the later. Such evaluationindicates that if a low-income grown-up citizen with public optionshifts to private health coverage for twelve months, the insurancewould cost an additional 25% for such individual (Jones, 2014). Thedifference may be as a result of several factors, such as higherdirect costs in private programs and increased rates of payment toMedicaid.
Apublic option would also offer an additional opportunity for clients,most of whom may have a preference for civic than a private cover. Amajority of Medicare recipients tend to be more content with publicinsurance than private coverage. Most citizens with the company-basedcover or private insurances report issues with medical bills. Thenumber of complaints in this category doubles that of Medicareconsumers. Close to one-half of Medicare clients go without thenecessary care due to high costs. Because of its connection withMedicare, the public option encourages payment in a morenon-exploitative way to the local health care markets and hospitals.Even if the members in public option are insignificant, the providersmay still find it meaningful to treat them as patients who benefitfrom the program. This, in turn, will remove limits on the consumers’choice to buy their insurance from the public option.
Mostproviders do not desire to admit Medicare patients because theprogram has many ailing individuals and they use health services morefrequently. In a case where Medicare orders that the providers whoagree to take ACA beneficiaries will equally be allowed to treatpatients with public health insurance, then it is evident that theywill handle patients more passionately. Through this, the publicoption may become more appealing to the consumers (Jones, 2014).Accordingly, coverage rates will be increased while and the actualpremiums will go down. It will lower fiscal supports and elevate thetax base.
Ensuringthat the public option becomes widely accessible would radicallyincrease the rate of its adoption. The prices in private markets andgroups will decrease due to reduced proceeds for both insurers andproviders. In the course of time, the disparity between privateinsurance and Medicare rates would be anticipated to drop. Therefore,the transition from private to public insurance would be noticeablybigger. On the same note, the private market may experiencecompetitive forces when it attempts to regulate prices. Thereductions in premiums in the individual markets would be smallerthan what would be realized in public option. As such, the costsaving for the governments will arise from increases in the tax baseand lower health care prices will indicate higher salaries (Jones,2014). As a result, the country will have more taxable incomes.
Throughregulating the providers, it is expected that the new policy willhelp to reduce costs by maintaining low prices. If integrated intoMedicare, a public option will be available to everyone who obtainsinsurance through the controlled marketplace. Medicare has alreadyestablished a scheme through which clinics will be compensated on thebasis of client’s first diagnosis, instead of for every servicedelivered. The approach is seen as a way that will make people toprefer a public option over the private insurers. It will lead theprivate sectors to understand how they can create improved healthcover (Jones, 2014). Through this, there may be an introduction of aprivate option for American citizens.
Noindividual ever wishes to have many health insurers at the same time.In this case, since a public option comes as a single coverage thatoffers lots of services, many American residents may find it easy toadopt and apply its strategies. Even insurers who extort patients byregistering healthy citizens or imposing devious charges may not soonsucceed in the health care marketplace. The public option willultimately rescue the old citizens who are forcefully signed up forcover on the basis of their ages (Jones, 2014). Also, it willreassure clients that they do not have to depend on the privatebrokers, hence set standards for how a good basic insurance policyneeds to be.
Withits sense of cost advantage, the policy will possibly force privateinsurers out of the ACA exchange. In fact, even if the public optionsets prices to equalize what the private insurers charge, it willstill not contradict the aspect of citizen choice. It will mean thatcitizens have a better option which is nonprofit and legitimatelyadministered (Jones, 2014). As a result, it is possible that the planwill ultimately be the only opportunity for everyone to have goodhealth.
TheCapacity of the Public Option to Generate Savings
Supportersbelieve that the public option stands a chance of generating savingsin many ways. For example, a more comprehensive public plan canenable the citizens to have greater power for bargaining with medicsand clinics. Also, a public option can show costly insurers how theyneed to offer good cover at reasonable charges with consistency andtransparency. Most public option savings originate from increases intax base or reduction in funding. Through a public option, thegovernment and its capacity to negotiate repayment rates would helplower the cost of health cover. By providing coverage at reducedcharges, the public health insurance would bring about greaterrivalry into the care sector and in that way lower the dividends ofthe private health insurers (Jones, 2014).
Becausethe administration would be supporting health cover, lower premiumswould translate to reduced overall governmental healthcareexpenditures. The strategy for lowering economic expenditures is whatleads to subsidy discount. For the public option to be in a positionto lessen exchange grants or change the tax bases, it has to bestructured in a way that it may be able to rival with all the privateinsurers. For this to be a success, the public option has appealed toproviders and enrollees, all of whom are essential to the success ofthe health care market. The American health sector has design defectsand requires a public option that is strong enough to attract asignificant population of providers and consumers.
Throughits robust nature, the planned public program will allow civicparticipation and lead to considerable economic reserves. A steadypublic insurance plan would propel rivalry within the exchangeprogram, and this would result in decrease in the premiums of mostinsurers. The anticipated outcome is likely to look somehow like ahybrid of private and public insurance. What may be seen in theAmerican health system will resemble the model of the Americanuniversity where rivalry from public colleges dictates the costscharged by private institutions (Jones, 2014). Nonetheless, unlikecolleges, the public healthcare may not be provided with the netgovernment subsidies.
Thepublic option will present favorable rates to Medicare providers suchas those formerly suggested by the Congress. Currently, the rates ofMedicare providers are much below those of private insurers. Lowpercentages are seen to have the capacity to popularize the publicoption and make it known to the consumers. On the other hand, lowrates of repayment may make the public option fairly detested by theproviders, including the physicians and hospitals (Jones, 2014). Itis only when patient populations will be high that providers willhave the motivation to agree with the public health option.
Theconsumers are yet to be enticed by the public option because it isable to appeal to and maintain tolerable networks of providers. Apublic option balances its costs with the rate of consumersettlement. As a result, the net impact of high or low rates on theproviders is easy to calculate since it is influenced by theeffectiveness of the market in which insurers do business (Jones,2014). The public option has high provider and individual rate ofenrollment and this makes it regulate potential pressures on cost. Itcharges moderately below the premiums in the market and paysparticipants better to avoid pressures on the private health caremarket.
Relevanceof the Public Option on the National Labor Force
Thepublic option has the potential to influence firms’ disposition tohire and the readiness of people to work. On the other hand, it canpromote labor supply and demand. Such effects on labor can in turncause an impact on the governmental revenues. Proofs show that laborforce rises when earnings are good. The scenario is commonlyexperienced at the extreme sides of the labor market where womenoccupy the largest tiers. However, the proposed public option standsa chance of counter-balancing this kind of labor aspect (Jones,2014). Both the single and married women, who do not have employmenttype of insurance, miss out on employment opportunities because ofthe fear of losing ACA.
Ifthe affordable health insurance can be made readily accessible to theuninsured employees through the public option, there could be anincrease in labor force particularly in the low-salary side of thecountry’s labor market. Moreover, the degree by which this occursrelies on the affordability of the public option. Even if low-costhealth cover does not spur the participation of labor force among thelow-wage employees, there would be significant economic benefits. Itwill happen because low salary employees do not pay levies but ratherreceive incentives through the EITC payments. An increased payment bythe EITC can possibly put out of place the well-being costs throughthe TANF program (Jones, 2014). Nonetheless, the average funds to thepublic sectors will likely be small.
Apublic option can cause a more significant effect for firms on theissue of labor demands. Job creation process may become inexpensiveif the charges associated with health insurance become low-priced. Atpresent, the United States uses more than 16 cents per dollar tocater for health care. Undoubtedly, if the cost of healthcare isreduced through the public option, companies would shift fromspending on employee health care to paying them better wages. Moreimportantly, a decrease in the costs of healthcare may obviously makeit easy for firms to employ. In turn, there will be a stimulation ofemployment (Jones, 2014). However, the impact of public healthinsurance may be lower in the course of normal times when premiumsoffered by the private insurers resemble that in the governmentalsectors.
Althoughthe provision of care may initially be costly, the public healthprogram can lead to profits in the long run. For example, the publicoption can become a vehicle for the majority of the presentlyuninsured to attain coverage. Through this, it can save money andeventually support lives. The enrollees may also evade becoming sickconstantly because of the lack of medicinal care. Instead of waitingfor the moment when they may suffer and turn to expensive emergencyclinics for treatment, the Americans who are covered by the publicoption will benefit from immediate therapies (Jones, 2014).
Itis a fact that a public option would lead to competition against theindividual firms hence make prices remain affordable for everyone. Inthis view, the private cover firms would encounter difficulty inchallenging the public health insurance option. The new plan is lesscostly and may eventually force private firms out of the industry. Intheory, the public plan remains prominent because it influencesphysicians or hospitals to take payments that are below what ischarged by the private insurance plans. Analysis of the bill suggeststhat only a negligible percentage of the U.S. citizens would avoidthe public health coverage plan (Jones, 2014). In this perspective,it is now unfortunate for the country that the Legislature has optedto ditch the public option a plan that most residents may readilyadopt.
Whatthe Future Holds for the Public Option
Itwould be important for the House to continue structuring the bill tocome up with a public option version that has slightly lower premiumsthan those charged by the private insurers. Such a plan would ensurethat the health care providers are paid at agreed rates which arealso not lower than those of Medicare. Through these, the programwould have better ways of attracting more of the less healthyAmerican residents. Important to note is that the public option wouldnot be readily available to every citizen during the first year.However, by the second and the third years of the act’simplementation, the public insurance scheme would become available toanyone who is able to buy cover on an individual basis (Jones, 2014).Also, companies will find it easy to satisfy their employees whentheir health needs are catered for and salaries will be paidwholesomely.
Mostindividuals and businesses would be qualified to acquire coveragethrough insurance exchange programs which would entail a series ofprivate plans together with the public option. Bigger businesseswould become entitled to pay for the public health cover throughexchange programs. After a public option is completely introduced inthe nation’s health care market and becomes accessible to everyone,it is projected to have the capacity to invite more than 20 millionpeople. 12 million among these individuals presently belong toprivate insurance (Jones, 2014).
Thepublic option differs from the private health cover plan. It isbecause, under the new system, each citizen in the nation must havehealth cover offered by the government. In this case, the privateinsurance firms would stop to exist. Similar to the case of Medicaid,the state would play the role of insurer. It will mean that hospitalsand physicians will begin to operate independently and receivepayments from the public capitals under state-owned health indemnitysystem (Jones, 2014). Supporters of the single-payer pattern complainthat they have generally been excluded from the Congress debates onhealth care.
However,a public option is a flexible strategy because it can be used as aform of a collective treaty that every member rules. The only issueis that a public option does not have any impact on what the privateinsurance companies offer (Jones, 2014). Because the plan has tocontest in the same market that the private plans operate, there isthe need for it to be outstanding in terms of attractiveness.
Theonly way that the government will realize higher premiums will bethrough the provision of a public option. Most insurance analystsview that this proposed bill could be the best way to make citizenscomprehend the results of the Affordable Care Act. Some lawmakers arealready sensitizing the public officials so that they can have goodinsight about a public option. Moreover, as a factor of competition,private insurers may soon begin to sensitize their clients regardingthe consequences of a public coverage option (Jones, 2014). However,if the federal government decides to pass the legislations, it isprobable that patients from private institutions may have anopportunity to participate better in the Affordable Care and thehealth exchanges.
Introducinga public option in the nation’s health insurance marketplace hasthe capacity to both promote coverage and lower tax rates. Equally,this new strategy can have positive effects on labor and saveemployers from exploitative private insurers. The scope and structureof a public option have positive impacts on health care costs. Itwill be an effective strategy for discussing the issue of reducedcosts per unit. The lower premiums of a public plan imply thathospitals will start charging more pocket friendly medical bills.Even though there has been an enactment of wide-ranging health carereforms, the most potential way to make the sector comprehensive isimplementation of the national-level public option. States havefreedom to institute the policy at any moment, and there is no reasonto make a region regress from it. Compared with most of the country’shealth systems, a public option seems like a costly program. However,likened with the commonly known private insurers, it is the mostefficient. The charges are rational and lower. The public option’sper-enrollee payments will grow substantially slower than that of theprivate insurers.
Jones,D. K,. (2014). Pascal`s Wager: Health Insurance Exchanges, Obamacare,and the Republican Dilemma. Journal of Health Politics, Policy andLaw, 39(1), 97-137.