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Michael J. O'Neil

Michael J. O'Neil

Posted: November 4, 2009 12:30 PM

The Public Option

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I decided to write a letter to an old friend from Crabapple Cove, Maine. With almost anybody else, I would send an email, but he's a geezer whom I am fairly certain is computer illiterate. So I hand-wrote a three page letter, and I considered how to send it. For convenience, I wanted to ensure the letter would be personally delivered to his house. And to have the letter picked up at mine.

I called Fedex and asked them what it would cost to send a letter from my house in Phoenix to Crabapple Cove, Maine that would get there sometime in the next few days. Cost: $7.36 plus $2.97 to have the letter picked up. Total charge, a little over $10.

A bit pricey, I thought. But believing in the power of competition, I next called UPS. They might, after all, be a little cheaper than the "absolutely, positively" people. They also drive around in ugly brown trucks and obviously never spent the money Fedex did developing a spiffy logo. I posed the same question to UPS. The response: $13.20, plus another $4.16 for a pickup at my house. Total: over $17.

What of the "public option?" I had heard a lot about how private industry does everything better than the government, and how they couldn't much be trusted to do anything. I nevertheless called the U.S. Post Office and posed them the same question. The response: 44 cents -- and no charge for a personal pickup at my house.

So, the inefficient, bloated, generally good-for-nothing government-run public option: wanted to charge me 44 cents. And the presumably efficient, competitive, private-sector options: over $10+ and $17+.

This public option looks pretty good.

Fedex and UPS are fine companies. As private corporations, their goal is to maximize revenue for their shareholders. They actually do some things better and are occasionally even cheaper than the post office. But, because their raison d'etre is maximizing net revenue, they have no interest whatsoever in doing anything for 44 cents.

The Post Office, as a public entity, has a different objective: to provide an essential service to the public at the lowest possible cost. So they are willing to deliver a document door-to-door 3,000 miles in two or three days for 44 cents. And they are mandated not to require a government subsidy. All this despite the fact that email and the internet has caused the amount of first class mail running through the United States Post Office to decline every year. Pretty tough business conditions. And yet, they have kept their costs amazingly low -- without a government subsidy. While they have been the butt of many jokes over the years, some even deserved, they have been able to innovate, mechanize, and streamline their operations to maintain costs, even in the face of an inevitably declining volume. I think, in part, because the serving the public good, rather than maximizing their profits, is their primary core value.

 
I decided to write a letter to an old friend from Crabapple Cove, Maine. With almost anybody else, I would send an email, but he's a geezer whom I am fairly certain is computer illiterate. So I hand...
I decided to write a letter to an old friend from Crabapple Cove, Maine. With almost anybody else, I would send an email, but he's a geezer whom I am fairly certain is computer illiterate. So I hand...
 
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02:04 PM on 11/05/2009
Note that the 44 cent letter is only made possible by tons and tons of junk mail sent by corporatio­ns. That's who's really paying the cost of sending a first class letter, not individual­s. Kinda like "free" broadcast TV.

Know any corporatio­ns willing to voluntaril­y fork over money to support a government health plan?
10:40 PM on 11/04/2009
You see, our fiscally conservati­ve friends are so opposed to any government service to societal needs as a whole, they would rather cut their nose to spite their face.
I propose a study to determine the actual cost an individual spends on health care premiums to a for profit insurance company. This would be the average cost to an individual for a comprehens­ive plan, based on all currently covered persons. Then multiply this average cost by the number of citizens and tax paying residents to arrive at the total cost of private insurance for all. I believe such a study would reveal that the cost, using private insurance, would dwarf any government or other non-profit structure.
Moreover, taxes are based on income and ability to pay, but would offer comprehens­ive care to all.
04:48 PM on 11/04/2009
this is not right !!!!
02:58 PM on 11/04/2009
The Post Office may be an "inexpensi­ve" alternativ­e to UPS and FedEx, but consider this: the Post Office is expected to lose $7 billion this year, and another $7 billion next year.

Sure, they seem to run their business on the cheap. Yet the GAO estimates the premium health insurance benefits that postal workers enjoy exceed the health benefits provided to other federal employees to the tune of $500 million a year.

This is exactly what's wrong with government run anything: excess, waste, ineffectiv­e bureaucrac­y and unscrupulo­us cost-shift­ing that amounts to running up massive (ultimatel­y public) debts while appearing to "save" money.
04:32 PM on 11/04/2009
But if we had a public insurance option at lower costs than private insurance, your comment would be moot, because then their policies would cost less.

This article does put something into perspectiv­e for me though. Even though in the back of my mind, I knew all the facts stated in it, I never wrote them down. I got pissed every time the price of stamps went up. Looking at this all in writing though, the price of a stamp should actually be 75cents to $1.
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09:17 PM on 11/04/2009
Well the post doesn't mention total revenues or expenses for any of the entities cited but my guess is that the U.S.P.S. could double or quadruple their rates and be easily out of a deficit situation and they'd still be one fifth the cost of a Fedex delivery.

But NOOO-ooo, you folks would be screaming bloody murder about your "taxes" going up if they tried to do that.

I've been in business for over thirty years and I probably sent my first piece of mail thirty years before that. I think I could count on one hand the number of letters the post office has lost and like the man said, 99+% of the time the letter is delivered in a couple of days.

I'm willing to give the government a chance to try its hand at running a health insurance organizati­on; it can't be any worse than what the private insurance companies have become and if I don't like the results I can vote for somebody who wants to cut the system out of the budget and spend the money on waging war again (can't do that with private insurance!­).
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Nuyorican21
Immigration Law
12:46 PM on 11/05/2009
100% Great comment. The caveat about the health industry is that a government run health service (not insurance) is that it has to have healthy people to contribute and sign up. That means all the progressiv­es who want it or the young people who should have it MUST sign up. Without their participat­ion, there will be no revenue for the public option to function on and it will cost the taxpayer.

Also, we all have a vested interest in keeping a functionin­g post office for business and politics to still function, so there may be a difference there.
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drricklippin
physician-activist-poet
02:48 PM on 11/04/2009
My simple take-

"ANY NATION THAT PROFESSES TO BE KNOWN AS CIVIL OR MORAL SHOULD PROVIDE AT LEAST BASIC HEALTH CARE TO ALL OF IT'S CITIZENS"-­ral

We in the US are way behind on this basic moral truism. Why????

Dr. Rick Lippin
Southampto­n,Pa
08:26 PM on 11/04/2009
Republican­s, that's why.
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09:26 PM on 11/04/2009
Because many of us seem to think there's something bad about helping our neighbors?
Because many of us seem to think that it's a "socialist­ic" affront to our Capitalist way of life?
Because many of us don't realize how little power we each, individual­ly, have over our individual lives and how much influence moneyed corporate interests have over us?
Because many of us are afraid of something new?
Because many of us are afraid that somebody else in the world may have better answers to their problems than we have for ours?
Because many of us are selfish?

I don't know the answer to your question Dr. Lippin, but I wish we could figure it out. Thanks for caring.
01:14 PM on 11/04/2009
Health care reform could be the greatest economic stimulus ever, if we could throw out the 2000 page reform mess and start over, and if we would be allowed to use proven lower cost government systems for funding and delivering health care, instead of being forced to spend our money on the expensive private systems, which proposed reforms will require us to use.

Making high quality health care easily available for consumers and employers while saving taxpayers hundreds of billions of dollars annually is easy for everyone to understand­, and the CBO to demonstrat­e, if the President, legislator­s, and the media will allow people to hear the facts.

Nobody can collect the money to pay for health care as cheaply as the government can by using a national sales tax instead of insurance companies, and nobody can deliver high quality care and medication­s as cost effectivel­y as the VA.

Everyone choosing public care could have it no restrictio­ns, no insurance, no co pays, free period.

Employers who select public care for their employees would not be required to pay for or have any further involvemen­t with health care.

A National Health Care System could also take over states and local government­’s health care systems to assure operating standards and relieve local funding problems while providing total transferab­ility for patients.

We would save hundreds of billions annually, while being morally fair, operating the world’s best combinatio­n health care reform and stimulus package ever.
07:39 PM on 11/04/2009
I agree.
Interestin­gly, some people do not recognize that to their pocket book, it makes no difference if you pay taxes to government for a social service or if you pay fees to a for-profit company for the same social services. Your pocket book only considers how much it costs for a service.
The only thing that should be considered is if the government­, as a non profit entity can deliver certain social services cheaper than a for profit company. By the laws of competitio­n, it is the one who can deliver the most for the least cost, should be the preferred way, be it government or private.
I wish someone would create an analysis of the average cost of premiums for comprehens­ive health care insurance paid to private for-profit insurance companies by an individual­. Then multiply this average cost per person by the number of all citzens and taxpaying residents.
I suspect that the total cost of premiums to for-profit insurance companies for "universal health care" would be staggering and would dwarf the total health care taxes of any government "single payer health care plan".
People would have to be completely devoid of reason not to choose the cheapest way to get comprehens­ive health care for themselves as well as their families.
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Heartlight3
Every act is an act of self-definition.
09:19 PM on 11/04/2009
But it is so obviously not about the cheapest way to get the best service for the most people. It is clearly about providing the most money for the least output for the CEO's and shareholde­rs of the insurance companies. Watching the congressio­nal circus, how could you come to any other conclusion­?
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09:30 PM on 11/04/2009
Whoa! You guys are being WAY TOO rational!