Trigger Unhappy

by Jacob S. Hacker | October 22, 2009

Jacob S. Hacker is the Stanley B. Resor Professor of Political Science at Yale University. An expert on the politics of U.S. health and social policy, he is author, coauthor, or editor of numerous books and articles, both scholarly and popular, including The Great Risk Shift: The New Economic Insecurity and the Decline of the American Dream (2006; paperback, January 2008) and Health At Risk: America’s Ailing Health System and How to Heal It (2008).

As closed-door discussions continue in the Senate, the idea of triggering the public health insurance option is once again on the table. Advocates of the trigger cast it as a compromise that will attract the support of the small number of conservative Democrats who have expressed reservations about the public option, as well as Republican Olympia Snowe, who has proposed a trigger. But to be a compromise between public plan skeptics and the majority of Senators who support a public plan because it is central to ensuring affordable coverage while limiting the budgetary costs of reform, a trigger must have some prospect of working—and a trigger inserted into the two Senate bills now being merged would not.

A workable trigger would, at a minimum, need to achieve three goals: (1) establish a reasonable and measurable standard for private plan performance that sets out clear affordability and cost-containment goals for a specifically defined package of benefits, (2) assess this standard in a timely fashion with information available to policymakers after reform legislation passes, and (3) if this standard were met, quickly create a public health insurance plan that would effectively remedy the situation. 

The modifier “quickly” in the third goal is crucial: Runaway health costs are a grave and growing threat to federal and state budgets and to the health security of workers, their families, and their employers. Waiting longer than absolutely necessary for affordable coverage is certain to cause great harm. Indeed, it might actually compound the current crisis. Without an imminent threat of public plan competition, private insurers are likely to raise premiums in anticipation of the implementation of reform—as suggested by AHIP’s recent prediction of big premium increases if reform passes. Delaying a public plan may also jeopardize the cause of reform itself, because requiring Americans to buy unaffordable coverage has the potential to provoke a political backlash. (Polls show that Americans are more supportive of a mandate when they know they will have the choice of a public plan.)

In short, we cannot wait for a public plan—and one of the biggest problems with a trigger is that it virtually guarantees we will have to. 

The problems, however, do not end there. Consider just a few of the other serious difficulties:

All this is not surprising in light of the history of trigger proposals in health care and other policy areas: As is well recognized, triggers are generally designed to create political cover, not effective policy. 

Less well understood is that some of the key difficulties with triggers are intrinsic to central characteristics of the Senate health bills. In particular, the Senate bills, unlike their House counterparts, leave an enormous amount of responsibility for the regulation of private insurance to the states—which for the most part have not had the wherewithal or will to take on large private insurers. The Senate bills also have much weaker regulations of private insurance plans outside of the exchange—the plans on which most Americans will rely after reform. At the same time, the Senate bills lack strong requirements on private insurers to provide data that could be used to assess whether a trigger should be pulled. Ironically, these characteristics make a public plan without a trigger especially vital in the Senate, where, of course, the public plan has also been more controversial.  

Added to the Senate bills, a trigger would represent a backdoor way of killing the public health insurance option that a majority of Americans (and U.S. Senators) support. It is way past time to trigger real competition for private plans that have failed to ensure affordability or cost restraint for decades.

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