Here is napkin #3 of 4 in my ongoing visual explanation of the health care debate. This napkin draws from the fundamental pieces illustrated in napkins #1 and #2 and maps out that actual legislation being proposed.
(You can download the whole sequence here on SlideShare.)
Today (with the exception of Medicare), America has a purely business-driven insurance model. Insurance companies collect premiums from us (usually through our employer), invest that money until needed, then pay the providers and keep any profit. To keep costs manageable, these insurers restrict who and what they will pay for.
The second option adds insurance "co-ops" (or exchanges) on top of the current system and legislates that all citizens must have insurance from one or the other. (No fundamental changes are demanded of the existing private insurers. These co-ops offer non-profit pools of insurance that citizens may choose to pay into instead of paying private insurers. (More on co-ops on Napkin #4.)
The third option adds a government-managed insurance option to the existing system and makes health insurance mandatory for all citizens. The government option can't make a profit by law. It does not replace today's insurers but adds another option for people who chose not to pay a private insurer but legally are still required to have insurance.
When this debate began in March 2009, most political conservatives were happy to keep the existing system in place. It was the White House that demanded reform and wanted to create the government insurer in Option 3. As the debate has gotten nasty, the White House seems to have given up on Option 3 as too politically difficult to achieve. The conservatives likewise realize that the status-quo isn't going to last, so are hoping for Option 1.
The many bills being developed and debated stretch across this spectrum. H.R. 3200 is the Democratic House bill sponsored by Rep. Dingell. It promotes Option 3. The big Democratic Senate bill sponsored by Sen. Kennedy appears to support both an Option 2 and 3. Senator Wyden's bill (also a Democrat) supports Option 1. The Republican House and Senate have been slower to propose options. It looks like both Rep. Blunt and Sen. Coburn's bills will support Option 1.
The private insurance industry does not like any of these options. All options open the insurance market up to increased competition (either private, non-profit, or public) which upsets the few remaining big private insurers who presently hold most of the market.
Of all options, the private insurers see the first as being the least threatening, so have gone to extraordinary lengths to demonize Options 2 and 3. Town hall meeting participants have picked up on several misconceptions and are out-shouting participants who want to open the debate to all options.
In the next and final napkin, we'll look at how the underlying differences in each option would impact me.