In the past month or so it has become less clear if there will be a public option in healthcare reform.
Typically those on the left make a moral argument about it being socially just to make healthcare available to everyone, yada yada yada. Now, I agree with this point, but at the same time I think the humanitarian argument is old and not very thought provoking. There are many other very good arguments to be made for the public insurance option, but they are not being articulated. Here is why I think the public option is needed.
At the moment health insurance is tied to employment. Access to healthcare is an extremely important thing for most people, so if a person wants to change jobs or build their own business the risk of leaving their job with group health insurance is very high. This risk is needless, and I would argue that many more people might consider pursuing their creative ideas and starting their own small businesses if they could get individual insurance at a reasonable cost (i.e. the public option).
Additionally, the public option would allow new small businesses to put their employees on the public insurance plan, dramatically lowering the business' costs. This frees up revenue that can then be reinvested into the business and its long term strategic goals.
Ahh! Socialism! One of the main arguments coming from the opposition at the moment is that if we allow a public insurance option, then government will begin to dictate where a person can seek medical care and what doctors a person can see. This cannot be allowed because government will be overstepping its boundaries and infringing on our personal freedom. Implied behind this is that the current system allows people to have full freedom when choosing their medical provider. This is completely false.
Anyone who has ever had insurance knows that one must try their best to seek in-network doctors. You certainly have the freedom to go out-of-network, but you will face bills that could potentially cause you to go into bankruptcy. Private insurance providers already dictate what doctors a person can see. So, I do not really see a difference here.
The best thing to do for a marketplace is to increase competition. In addition to competing with the private insurers government will stimulate competition in the marketplace by lowering the healthcare barriers that are keeping people out. If you lower the risk for starting a new business, then more people are likely to pursue this route. This can only be good.