A Stealth Public Plan?

Kathryn Nix of the Heritage Foundation -- a conservative-leaning D.C. think tank -- has a blog post claiming that the Office of Personnel Management-managed health care plan in the Senate health care bill could be much more sweeping, and (depending on your perspective), dangerous than most realize.

Nix's post, and an accompanying memo from Heritage expert Ed Haislmaier, raise some interesting points about the plan. Would OPM's power to negotiate conditions with insurers -- and withdraw contracts from the ones that don't meet its standards -- crowd out private insurers? Is OPM well-positioned to be a de facto inter-state regulator for multi-state insurance plans? (Though the plans will still need to meet state regulations). Those objections were some of the main reasons why conservatives objected to the so-called public option, which would have been a government-run plan to compete with private insurers.

But their biggest worry is that one of the provision's final paragraphs -- "There is authorized to be appropriated, such sums as may be necessary to carry out this section'' -- could lead the way to government-financed health care plans, or "bail outs" of financially troubled plans. That doesn't seem to be the intent of that line -- it's in the section of the bill that deals with administration of the plan, not new entitlements, and no where in the bill does it say that OPM should pitch in to help to pay for the health care plans. But the act doesn't specifically forbid that, either.

As a counterpoint to the Heritage post, just note that the Congressional Budget Office felt the opposite way -- that, if anything, the problem with the OPM plan will be that few insurers or customers will be interested in it, and it will have a negligible effect.

For more thoughts on the OPM proposal, you can check out this forum of health care experts.