Fact Sheet #29

Debunking the Myths

Lower Costs? It's a shell game. A government plan always looks cheaper, but the reality is that the true costs are hidden. Costs are passed on to providers in administrative costs and lower reimbursements, resulting in a huge cost-shift to private payers to make up the difference.
Quality Care? One only needs to look at current government health plans. Medicare has huge gaps in coverage. And Medicaid's quality is notoriously bad. The record is clear: They offer substandard care compared to private health insurance, especially in the areas of cancer and cardiac care. These persistent quality deficiencies are routinely overlooked in discussions of a government health plan.
Increased Competition? With a public plan, the federal government would create the rules for the "game" in which it plans to compete. But the government would not just be a neutral umpire in the game. It would also own one of the competing teams, namely the public plan.
The Public Plan Won't Crowd Out Private Insurance? It's impossible to believe that Congress and the Administration could resist setting rules—and interpreting those rules—in favor of their own public plan. Independent estimates show that as many as 119 million Americans would no longer be in private coverage.
The End Goal Is Not Single-Payer? As Congresswoman Schakowsky will tell you, the end goal is definitely a single-payer system. That's why many supporters of a single-payer system, where the government runs the whole health system, are suddenly converts to choice and private competition as long as there is a public plan.

Don't Drink the Complimentary Kool-Aid

Using Free Market Language Doesn't Make It a Free Market: Proponents of a public health care plan use descriptive language like "competition," "choice," and "level playing field" to give a false impression that their policies are consistent with market principles. In reality, these policies are the very opposite of a free market.
The President Will Never Have Enough to Pay for It: President Obama would like the American public to believe that he can pay for his plan. These promises are more hopeful than real, whether it's voluntary cost-saving by the health care community, savings from a new global warming tax, or "sin" taxes on soda and potato chips. What next?

An Alternative Prescription

Take Bold Steps, Give States the Power: Instead of expanding Washington's control of the health care system, allow states to develop solutions that will transfer direct control of health care dollars and personal health care decisions back to individuals and families.
Give Consumers a Real Choice: Give Americans a true consumer-choice system modeled after the one available to Members of Congress, not a façade for government-run health care.
Be Imaginative: Instead of typical liberal tax hikes combined with technocratic tinkering of administrative payments, Congress should reform existing health care spending, where value is secured for "payers," not patients.

For more information, please visit: http://blog.heritage.org/2009/05/21/the-public-health-care-plan-what-seems-to-be-the-problem/