Sunday, August 16, 2009

Republican Pressure

Today, Associated Press (AP) published an Article with the title White House Appears Ready to Drop 'Public Option'. Here is the first paragraph of the article:

"Bowing to Republican pressure, President Barack Obama's administration signaled on Sunday it is ready to abandon the idea of giving Americans the option of government-run insurance as part of a new health care system."

So it's Republican pressure, not pressure from some Democrats? The Democrats have a 60-40 majority in the Senate; they have an overwhelming majority in the House of Representatives. Republicans are powerless in Washington right now. Yet the first four words of the AP article, "Bowing to Republican pressure" makes it sounds like Republicans can stop the legislation. They can't.

So anyway, apparently they are going to do this instead:

Health and Human Services Secretary Kathleen Sebelius said that government alternative to private health insurance is "not the essential element" of the administration's health care overhaul. The White House would be open to co-ops, she said, a sign that Democrats want a compromise so they can declare a victory.

Under a proposal by Sen. Kent Conrad, D-N.D., consumer-owned nonprofit cooperatives would sell insurance in competition with private industry, not unlike the way electric and agriculture co-ops operate, especially in rural states such as his own.

With $3 billion to $4 billion in initial support from the government, the co-ops would operate under a national structure with state affiliates, but independent of the government. They would be required to maintain the type of financial reserves that private companies are required to keep in case of unexpectedly high claims.

"I think there will be a competitor to private insurers," Sebelius said. "That's really the essential part, is you don't turn over the whole new marketplace to private insurance companies and trust them to do the right thing."

So I guess these private coöperatives are never going to need a bailout, right? Seriously, if these coöperatives do run into problems (and you can almost bet on that happening), what's going to happen? Who is going to rescue them?

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