Raising Women’s Voices

Public Plan vs. Taxing Benefits

Posted in Affordability, Health Reform Policy Proposals by raisingwomensvoices on March 19, 2009

Witnesses at a March 17th House Panel debated the merits of a public plan option and elimination of the tax exclusion for empolyer-provided health benefits.public-health1

Some congressional Republicans claim that creating a public plan will create an unfair advantage over private insurers, while some witnesses feel it will promote competition.

Judy Feder, a senior fellow at the Center for American Progress Action Fund, said “We’re talking about choice. And the importance of that choice is actually to set a model. Insurance companies are no model for running this system efficiently.”

According to Sally C. Pipes, who runs Pacific Research Institute, a non-profit free market think tank from San Francisco, the costs of the mandates for both public and private plans will only drive up prices, but keep the public plan’s lower, ultimately moving our health system to a “Medicaid for All” system. Instead, she claims that we should remove the tax exclusion on employer-sponsored coverage, reduce state mandates, allow the purchase of insurance across state lines, and enact medical malpractice reform.

But others feel that tax exclusion will create more problems with affordability which, today, is the bottom line for many Americans.

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