Introduction

The public option had been kicking around for a while, however, in policy-wonk circles. Giving the uninsured an opportunity to purchase coverage through a Medicare-like health plan was seen as a useful means of putting competitive pressure on private insurers to provide decent coverage at low prices.

But as the debate has progressed, the public option has become an ideological flash point, igniting fears on the right that it will be the precursor to a government-run system like Canada's and some European countries'. Which is the same reason that many on the left like the public option so much. (Karen Tumulty, "The Strange Career of the Public Option," Time, 09/09/2009)

http://www.time.com/time/magazine/article/0,9171,1933212,00.html

In a speech to Congress on September 9, 2009, President Barack Obama re-affirmed his commitment to a public health insurance option, arguing that "an additional step we can take to keep insurance companies honest is by making a not-for-profit public option available in the insurance exchange."

So, is Obama's proposal for a not-for-profit public option a good idea?

To Include in my Introduction

What is the current status of the health care debate (summary).

Timeline of Important Events in public option debate.

My own stake/position in this issue. Where i stand going in...

Obama Quotes:

it would only be an option for those who don't have insurance. No one would be forced to choose it, and it would not impact those of you who already have insurance. In fact, based on Congressional Budget Office estimates, we believe that less than 5% of Americans would sign up.

Unfortunately, in 34 states, 75% of the insurance market is controlled by five or fewer companies. In Alabama, almost 90% is controlled by just one company. Without competition, the price of insurance goes up and the quality goes down

They argue that these private companies can't fairly compete with the government. And they'd be right if taxpayers were subsidizing this public insurance option. But they won't be. I have insisted that like any private insurance company, the public insurance option would have to be self-sufficient and rely on the premiums it collects. But by avoiding some of the overhead that gets eaten up at private companies by profits, excessive administrative costs and executive salaries, it could provide a good deal for consumers. It would also keep pressure on private insurers to keep their policies affordable and treat their customers better, the same way public colleges and universities provide additional choice and competition to students without in any way inhibiting a vibrant system of private colleges and universities.