Sen. Kaine says Medicare X could cure health exchanges

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WASHINGTON (Gray DC) - Sen. Tim Kaine says health care designed for retirees could be a solution for working-age Americans with no choice in the insurance market.

Twelve-million Americans are expected to get coverage through an Obamacare online marketplace rather than work next year. Of those, about one in five will find only one company selling insurance where they live according to the Kaiser Family Foundation.

“If you live in one of those counties, you’re not getting a great rate because essentially there’s a monopoly,” said Sen. Tim Kaine (D-Va.).

Kaine said those without a choice between insurers should be able to buy into a public option he calls Medicare X. He and Sen. Michael Bennet (D-Colo.) are sponsoring a bill to create the new insurance program modeled on the federal program for those 65 and older.

Medicare can afford to charge seniors relatively low rates for a few big reasons.
- The program takes in tax dollars from companies and employees
- It’s exempt from tax
- And, it pays care providers less than private insurance does

Kaine said tax-payer cash wouldn’t be used to fund his proposed insurance plan. So, those buying-in would pay more for Medicare X than seniors pay for Medicare. But, the Virginia senator said Medicare X would offer a cheaper alternative for individuals, and drive down costs for others in the private market.

“It will increase competition, it will bring down costs,” said Kaine.

He said Medicare X would force competing insurers to drop their prices, and individuals buying in would benefit from its lower administrative costs. The plan would be open to those outside a competitive insurance market by 2020, be listed on every individual marketplace by 2023, and open to small businesses in 2024.

Moderate democrats in Congress sunk hopes for a public option in the debate over Obamacare seven years ago. Bennet pushed for it at the time, Kaine was leading the Democratic National Committee.

Now, moderate democrats are the group pushing the idea. Conservatives said their concerns have not changed. “The reality is, the purpose of the public option is to destroy competition, it is to eliminate private plans,” said Bob Moffit, a senior fellow at the conservative-leaning Heritage Foundation.

Moffit said a public option is simply a transition to running all insurance through the government in disguise. He argues private insurance can’t compete with government coverage that benefits from major legal and tax advantages.

Moffit said consumer choice would reappear if D.C. returned rule-writing power to states. “The answer to the problem is to basically deregulate the health insurance markets,” he said.

The lack of choice isn’t expected to get better on its own. Forecasts from earlier this year suggest 45 percent of counties across the U.S. could have one or fewer insurers in 2018.

While the cost of insurance for next year has gone up, signups for Affordable Care Act coverage have as well.

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