Business community divided over public option in health care reform

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(Host) Vermont’s business community is divided over the creation of a new public plan that could be part of a federal health care reform bill.

But there’s little disagreement about the need to sharply control health care costs.

VPRs Bob Kinzel reports.

(Kinzel) Many Democrats in Congress say it’s critical to include a new public plan, modeled after Medicare, in the final draft of any federal health care reform legislation.

Under this approach, low and middle income people would receive subsidies to purchase either the public plan or a private health insurance policy.

Critics of the public plan, like Governor Jim Douglas, argue it will increase the government’s role in health care and might drive private insurance companies out of business.

Don Mayer is the public policy chairman of Vermont Businesses for Social Responsibility.

Speaking on VPR’s Vermont Edition, Mayer said he supports the public plan because it will provide much needed competition to the private insurance market:

(Mayer) "If the government can’t run anything efficiently then they’re not going to be very competitive in competing with the private insurance companies. So if they’re going to drive them out of business, it’s because the government is operating the health care system much more efficiently than the private insurance companies. And I think that’s what we need in our system is efficiency cost control and better outcomes for the people seeking health care in our state."

(Kinzel) Craig Fuller is the director of the Employers Health Alliance, a group that represents several dozen Vermont companies on health care issues.

He opposes a new public plan because he says government operated programs, such as Medicare and Medicaid, have been able to remain solvent only by cutting reimbursement rates to doctors:

(Fuller) "The only way those public plans have survived so far is by underpaying providers and shifting costs to the private sector. So it’s hard to see how another public plan will control costs when the two that we’ve got have been unable to do that.  I think it’s unfortunate that the public plan seems to have captured the debate and that’s the way the left and the right are bench marking success, when the real goal of reform has to be affordable care for everyone and that means controlling costs."

(Kinzel) Both Fuller and Mayer agree that the current fee for service payment system needs to be changed because it encourages an over-utilization of health care resources.

For VPR News I’m Bob Kinzel in Montpelier.

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