Thursday, October 8, 2009

Opting in and out

Nate Silver, political gem, explains why the clause being floated that may allow states to opt out of the public option aint all that bad. Here are his first four points:

1) If the public option is indeed popular -- and the preponderance of public polling suggests that it is -- we should expect the solid majority of states to elect to retain it. Perhaps some Republican governors or legislatures would seek to override the popular will in their states -- but they would do so at their own peril (and at Democrats' gain).

2) Behavioral economics further suggests that default preferences are extremely powerful. Making the public option the default would probably lead to much greater adaptation than requiring states to "opt in".

3) If the public option indeed reduces the costs of insurance -- and most of the evidence suggests that it will -- than the states that opt out of it will have a pretty compelling reason to opt back in. Say that Kansas opts out of the public option and Missouri keeps it. If a Kansan realizes that his friend across the border is buying the same quality health insurance for $300 less per month, he's going to vote restore the public plan in a referendum or demand that his legislator does the same in Topeka.

4) Even in states that do opt out of the public option, the fact that voters could presumably elect later to restore it creates an extremely credible threat to the private insurance industry that will itself help to create price competition.
Could we really be on the verge of making this happen?

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