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Senator Jeff Merkley Confident About The Public Option

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Senator Jeff Merkley (D-OR) is author of a key amendment that's been added to the health care reform proposal recently approved by the Senate Committee on Housing, Education, Labor and Pension (the HELP Committee).

His amendment is designed to expand access to affordable health care and to provide more choices for small businesses.

Senator Merkley remains optimistic that a public option will be included in the final version of the bill to overhaul what he describes as American's profoundly broken health care system.

Kathleen Wells: I watched your video, "Solving the Health Care Puzzle," in which you compare the challenge of reforming America's health care system to the classic Rubik's Cube puzzle. How would you summarize for Huffington Post readers your position on health care reform?

Senator Jeff Merkley: Our current health care system is profoundly broken. For those who have insurance, they are in continuous straps [sic] on the possibility of losing it. If they have a job and their health care is tied to it and they lose their job, there is a terrible double whammy of losing health care and job at the same time.

Those who don't have health care are in a situation where people are worried about getting sick or if they are sick, [they worry about] how to get well. [They also worry] if their children get sick.

This is a system that touches every American's life and not in a positive manner. We can do so much better in straightening out and vastly improving insurance for those who have it. Greatly extending the reach of access to health care, improving prevention, disease management, healthy choice incentives, primary care - [there are] a tremendous number of ways in which we can improve upon our existing system.

Kathleen Wells: The general consensus seems to be that reducing the cost of health care delivery should be a major priority in the reform process. Do you think inclusion of a public option is the best way to reduce costs and insure competition?

Senator Merkley: Inclusion of the public option is essential to bending the cost curve. I often note to folks that in Oregon we have a public option in workers compensation insurance. The average per hour costs of worker's compensation insurance today is one half [of] what it was 20 years ago when we didn't have a well functioning public option. Senator [Sheldon] Whitehouse notes that when he was Insurance Commissioner, they established a public option in worker's compensation in Rhode Island and the cost of worker's compensation insurance dropped by half. By creating competition, by holding private insurers' feet to the fire, you get better service. You get lower costs. So, a public option is essential.

Kathleen Wells: You're a member of the Senate Committee on Health, Education, Labor and Pensions (HELP Committee), which approved a health care reform proposal that includes a public option. The Senate Finance Committee, however, came up with a proposal that does not include a public option. Will the bill that Congress finally passes offer Americans a public option?

Senator Merkley: I'm very optimistic. You have four out of five bills that have come out of committee (three on the House side and two on the Senate) that have a public option in them. Even when the Senate Finance Committee turned down amendments putting in a public option, a lot of the commentary was, "Well, 'cause we don't think we can get 60 votes." Well, you never give up on a battle before you've fought the battle and I believe that this is so important. If we are looking for a health care system that is affordable and accessible to every American and we only address accessibility, then the affordability will blow up in our face. That's why it's essential that we have a community health plan or public option as part of health care reform.

Kathleen Wells: How does your optimism translate into reality in terms of what politicians actually do in Washington, DC?

Senator Merkley: Right now what it means is that Senator [Harry] Reid is hosting talks with Senator [Max] Baucus and Senator [Chris] Dodd and the White House. They are working through a list of issues [because] there are differences in the bills [each of the committee approved]. They have explicitly recognized that public option is one of those differences. A number of members have really weighed in heavily, have met with Senator Reid, as I have, to really emphasize how important it [a public option] is to the success of health care reform and I think there is a very good chance that the bill Senator Reid sends to the floor will have a public option.

Kathleen Wells: The media is characterizing this as a fight between the insurance companies and the American people (a majority of whom various polls indicate want a public option). You feel optimistic that the American people will win the fight?

Senator Merkley: Yes.

Kathleen Wells: Why don't any of the bills being proposed focus on regulating the insurance companies, especially in the area of premium rates?

Senator Merkley: Currently, we have a system of 50 states, each providing different forms of insurance regulation. We do have great regulation in Oregon. The bills that are on the exchange -- the marketplace that is created would have to meet the state standards. It is interesting that we have really put our efforts into the side of competition, i.e., creating more competition through the marketplace and the exchange and enhancing that competition further with a community health plan. It is the hope that those factors will, as they have in worker's compensation, really drive down costs.

Kathleen Wells: The HELP Committee passed an amendment you introduced which increases the number of small businesses that can purchase insurance via a gateway. Is the gateway concept similar to the exchange concept?

Senator Merkley: Yes, exact same item. I often call it a marketplace. Opponents of reform like to draw a very complicated chart and say look how complicated this is. But, really, health care reform comes down to a very simple chart.

Envision a box which is your computer and a box which is you. You go to your computer, you look at the list of health care options and you select one. Those who provide health coverage know that they can put themselves before millions of eyes [so] they have a real incentive to be on that list, which means you get a lot more competitors. They know that if you are not happy with their service, every year you have a chance to change providers. It creates a real incentive to keep people happy and that's very different than when you have a single provider in a market that basically has control of you because you do not have any alternatives to go to.

Kathleen Wells: Will these gateways, these exchanges be cost prohibitive if they don't include a pubic option?

Senator Merkley: Certainly, you will have more competition with a gateway than without, but you are going to get a lot better competition if you add a community health option.
What my amendment did is it said this marketplace or this exchange or gateway should be open to every business in America. We raised the cap from 10 employees to 50 and then said states can lift it completely. Some states may want to phase that in because they want to make sure that, initially, the marketplace isn't overwhelmed by so many customers that it doesn't run smoothly, if you will. But I think in very short order you are going to find that most states will want to provide every business access to the exchange because the more folks in the pool, the higher the competition, the lower price, the better off for the companies in your state.

Kathleen Wells: That means federal government control would be relinquished in favor of state control. Will it become too cumbersome?

Senator Merkley: No, I don't think so. Here is the thing: to provide a health care plan, you have to set up contracts with the providers. So, someone who can do so by [the year] 2012 in Rhode Island, might not be able to do so by 2012 in California. You are going to want to have the ability to offer plans to people that actually provide health care choices within that state. If you have a health care card, but there are no providers in your area, you don't really have access to health care.

But you will find that folks who have provided -- let's say, they operate in Washington state, knowing that they can access customers in Oregon, they [insurance providers] are going to have a real incentive to go ahead and set up contacts with providers in Oregon. That's why we expect to see more competition.

Here's the way it's set to work in the bill that came out of the HELP Committee: An employer would say, "You know what? I'm going to provide gold level insurance to my employees or silver level insurance." When the employees go to the exchange they get to pick from all the gold level plans, all the silver level plans. Instead of saying, for example, Blue Cross is the best plan for everyone in the company, everyone gets to sort out for their family what is the best plan.

Kathleen Wells: You and the President cite the paradigm used by the Mayo Clinic as an example for health care that the entire nation should adopt. Do you see any difficulty in implementing the Mayo Clinic approach on a national scale?

Senator Merkley: The Mayo Clinic uses integrated health care where they have doctors on salary. The doctors have no financial stake in the tests that are conducted and, therefore, doctors are free to exercise their craft without the issue of profit or loss ever passing through their head. That is an ideal setting because their complete focus is on "How do I get this patient well? How do I provide prevention? How do I increase general quality of life?" That is exactly the way health care should be everywhere.

It is hard to simply say to the bulk of the health care world, you must offer it like Mayo. But we are looking at how do we create incentives to encourage health care plans to operate like Mayo; to have integrated health care, so you don't have someone in the hospital [for a] very expensive procedure and send them home without proper support and then they are back in the hospital a month later and it's very expensive again.

It makes much more sense to have an integrated view of your patient and to have the focus of the health care professionals be on healing. So, I think we have a great deal to learn from Mayo and Cleveland Clinic and Puget Sound. These are wonderfully run and this is the sort of competition that we could bring through an exchange. We'd hopefully see those models outperform and people will vote with their feet and join those models when they are offered and will migrate in that direction.