Opt-out Public Option Gathers Steam

Josh Marshall reports on the new opt-out public option idea for health care reform on Talking Points Memo.

But just on the face of it, this sounds like a compromise reformers could embrace because I suspect many, probably most states would opt in, providing a plenty large enough pool to get to the bargaining power that is essential to make a public option work.

Part of my assumption here is that you'd have relatively few states opting out and they'd tend toward lower population states, likely clustered in the South and mountain states. So I suspect that a substantial majority of the population would be in opt-in states, providing the bargaining power that would make the public option threshold viable. And if the public option works, one would think the people in opt-out states would quickly become pretty envious of the folks in states who had the option and pressure their state governments to get in. Of course, if the public option was an abysmal failure the reverse would happen.

Ezra Klein agrees.

It also creates a neat policy experiment: We can see, over time, what happens to state insurance markets that include the national public option and compare them with those that don't. We can see whether the worst fears of conservatives are realized and private insurers are driven out and providers are forced out of business due to low payment rates, and we can see whether the hopes of liberals are right and costs come down and private insurers become leaner and more efficient. Or both, or neither. It's an opportunity to pit liberal and conservative policies against each other, rather than just pitting liberal and conservative congressmen against each other.

--Ballard Burgher