Skip to main content.

Obamacare needs fixing, but here's why the public option remains a long shot

Obamacare needs fixing, but here's why the public option remains a long shot

Picture of Trudy  Lieberman
Proponents of the public option didn’t prevail in 2009. They’re still unlikely to do so today. [Photo: Scott Olson/Getty Images]
Proponents of the public option didn’t prevail in 2009. They’re still unlikely to do so today. (Photo: Scott Olson/Getty Images)

Will Obamacare discontent — collapsing state insurance markets; little competition among insurers and hospitals in too many locales; sky-high premiums for millions who won’t get subsidies — be enough to resuscitate the public option?

Recall that a public option added to the Affordable Care Act would have given consumers an alternative to private insurance. During the health reform debate in 2009 it generated tons of enthusiasm among ordinary Americans and liberal Democrats. Even House Speaker Nancy Pelosi promised to include it in the final House bill. (She later reneged.) But anyone watching the opposition to the measure from the same groups that always had opposed national health insurance would have known the idea was doomed from the get-go. Opposition came from doctors, hospitals, and drug companies, which feared lower reimbursements; from the business community that feared an entrée to socialized medicine; and from insurers fretting about their profits. Many moderate Democrats listened to their pleas, and when the White House signaled the public option “was not the essential element for reform,” it was clear the going would be rough.

As health policy experts Helen Halpin and Peter Harbage wrote in Health Affairs shortly after the law passed, “It is difficult to recall a federal health policy proposal that has seen such dramatic ups and downs as the public option endured.” Still, Halpin and Harbage left the door open concluding, “the proposal could reemerge if the public becomes dissatisfied with the progress of health reform.”

Has the dissatisfaction reached a tipping point? 

The troubled marketplaces that expose the fundamental contradictions in the Affordable Care Act would give weight to that argument. So does the increasing but predictable consolidation in health care that leaves patients with fewer options for care or coverage. The relentless rise in pharmaceutical prices and rising costs of other medical services suggest a new player — the government — should enter the game and begin to seriously control costs. Then there are stirrings of a grassroots movement from a group called the Progressive Change Campaign Committee, whose partners include and Democracy for America, that has been drumming up signatures and urging members of Congress and Congressional candidates to “clearly state their support for a public option.”

Last week came an email from a Nebraska woman. She wanted me to know about her family’s $1,100 monthly premium and the $6,250 deductible that she and her husband would each have to pay. “That is $12,500 that would come out of our pocket before insurance kicks in,” she wrote. “I don’t think Obamacare has helped. Sure, everyone can get insurance but who can afford it?”

Yale political science professor Jacob Hacker argued recently in Vox, “The evidence that we need a public option has gotten much stronger. Indeed every one of the original arguments for the public option looks more valid today than it did then.” 

But are those reasons enough to tip the political scales in favor of the public option, no matter how good an idea it may be? 

I’m skeptical. Democrats are divided. They were last time, too, and moderate Democrats helped torpedo the provision. They might do that again. Montana Sen. Jon Tester told Politico the focus should be working “on a bipartisan basis to fix Obamacare.” North Dakota Sen. Heidi Heitkamp called the public option debate a “distraction” that’s preventing a discussion of higher quality care at lower costs. Missouri Sen. Claire McCaskill said she wanted to make sure “we’ve done everything to make the market work before we turn to that.” 

Do campaign contributions figure into their calculus? It’s hard to know, but a check of Open shows that Blue Cross/Blue Shield and the Council of Insurance Agents and Brokers were among Heitkamp’s top five contributors from 2011-2016. Express Scripts, the pharmacy benefits manager, was among McCaskill’s top five.  (Those organizations did not donate but their political action committees, individual employees or owners or their immediate families did.) In the political game notable contributions like those can buy access to a wavering member of Congress.  

Then there’s the sad tale of the Obamacare co-ops. In reality, the 23 nonprofit co-ops that opened for business were a sop to public option supporters, a kind of consolation prize that’s been of limited value to insurance shoppers. Only five remain. This week a sixth, Baltimore-based Evergreen Health, announced it would become a for-profit company to avert the possibility of a shutdown.

Many co-ops did provide significant competition to the big carriers offering low premiums and wide provider networks. But they were undercapitalized, attracted lots of older and sicker people, had no claims data on which to base premiums, and without a substantial customer base, they had no clout to bargain for good provider discounts. Perhaps even more important, Congress tied their hands from the beginning. Initial funding was too low, and there were other restrictions that had the effect of shielding the big carriers from the competition the co-ops were meant to provide. The big boys won.

Will a public burned by the demise of the co-ops be willing to trust the government with a public option that could offer similarly low premiums but perhaps operate with so many restrictions that its marketplace power is weakened? Such restrictions would likely be part of any potential compromise on the public option.

It will take extraordinary political leadership to overcome the obstacles and lingering public distrust. It will require much more than the political speak on Hillary Clinton’s campaign fact sheet that says she “will pursue efforts to give Americans in every state in the country the choice of a public option insurance plan.” And it will take more than half-baked support like that from President Obama, who wrote in JAMA earlier this year that Congress should revisit a public plan “to compete alongside private insurers in areas of the country where competition is limited” In other words, a public option only for some! Really? 

But before anyone can talk about the nitty-gritty of what a public option would look like, the public must be on board, and its support is by no means assured. Too many people feel deceived by the president’s broken promise in 2008 of a $2,500 yearly cut in insurance premiums for a typical family and the false pledge of “affordable quality health care,” the sales pitch for Obamacare.  The opposite has happened. Those typical families are angry.

Last week came an email from a Nebraska woman. She wanted me to know about her family’s $1,100 monthly premium and the $6,250 deductible that she and her husband would each have to pay. “That is $12,500 that would come out of our pocket before insurance kicks in,” she wrote. “I don’t think Obamacare has helped. Sure, everyone can GET insurance but WHO CAN AFFORD IT?” And why, the woman asked, did she have to carry maternity coverage and vision and dental coverage for those under age 19? No one in her household needed those services.

Her questions point to the kind of revisions likely to be on the table. They won’t include a discussion of national health insurance based on the ideas of social solidarity and pooling health risks over a lifetime, central features of many foreign health care systems. In the next few years, there will be policy efforts to address the affordability problem affecting the Nebraska woman and thousands of others. If I were a betting person, I’d wager that the most likely changes will not include the public option.

I might bet that Congress will make it easier for middle income people to qualify for larger subsidies or that more people could become eligible for them. Maybe they would fix the family glitch. I’d place a bet on new insurance options that eliminate some of the ACA’s required benefits like maternity care that could lower premiums — a so-called “copper plan” with fewer benefits and maybe more cost sharing that could resemble the old individual market policies sold before reform. Lower limits for deductibles and out-of-pocket maximums might be in the cards. But unless the politics shift dramatically, or there’s a groundswell of public anger, I’d bet much of Obamacare will remain in tact leaving the world safe for health care’s biggest stakeholders.

Veteran health care journalist Trudy Lieberman is Contributing Editor of the Center for Health Journalism Digital and a regular contributor to the Remaking Health Care blog.

Leave A Comment


Domestic violence affects tens of millions of Americans every year. Yet media outlets mostly treat incidents as "cops" items, if they cover them at all, as opposed to treating domestic violence as a public health problem. Our free two-day symposium will help journalists understand the root causes and promising prevention, intervention and treatment approaches.  Plus participants will be able to apply for grants to report California-focused projects.

The pandemic has unleashed a tsunami of misinformation, lies and half-truths capable of proliferating faster than the virus itself. In our next webinar, we’ll delve into what one of our speakers has termed “the natural ecology of bullshit” — how to spot it, how it spreads, who is most impacted, and how to counter it. And we’ll discuss reporting examples, strategies and story ideas that incorporate these insights and effectively communicate to diverse audiences. Sign-up here!

Are you passionate about helping journalists understand and illuminate the social factors that contribute to health and health disparities at a time when COVID-19 has highlighted the costs of such inequities? Looking to play a big role in shaping journalism today in the United States? The USC Center for Health Journalism seeks an enterprising and experienced journalism leader for our new position of “Manager of Projects.” 



Follow Us



CHJ Icon