'Public Option' Sticking Point For Health Insurer

Many of the nation's health insurers are opposed to a key part of the Democrats' plan to overhaul health care. Supporters call it the "public option" — which means the government would offer a health insurance plan for individuals. Dr. Sam Nussbaum is chief medical officer for WellPoint, the nation's largest health insurer. He explains to Steve Inskeep why his organization is against the public option.

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STEVE INSKEEP, host:

Next, we'll hear from a leading insurance company, one of many opposed to the so-called public option. That's the plan for a government health insurance program to compete with private insurance. We sat down with Dr. Sam Nussbaum, chief medical officer for WellPoint.

What's wrong with the public plan?

Dr. SAM NUSSBAUM (Chief Medical Officer, WellPoint): Steve, we do not endorse a government-run health plan. We absolutely want to see universal coverage for all Americans. We believe the private sector can provide innovative solutions to health care.

INSKEEP: Dr. Nussbaum influences coverage received by WellPoint's 35 million customers. It is the country's largest health benefits firm. He argues that the private sector is more efficient than the government.

Dr. NUSSBAUM: Let me give one specific example, Steve, that I think will be informative. When we look at advanced imaging, and these - this is MRI, CAT scan and PET scans - we know that as much as 30 percent of those procedures are not necessary. And we've been able, over the last several years, to have growth in imaging procedures of between 0 and 5 percent. The government under CMS has seen imaging grow 15 to 20 percent a year during the same time interval. As an example…

INSKEEP: You're talking about Medicare payments. The Medicare program.

Dr. NUSSBAUM: Yes. The Medicare program. I'm talking about the use of imaging services and the cost of imaging services. So I would argue that where the private sector has been far more effective than government programs is in limiting clinical services to those that are best meeting the needs of patients. Important as Medicare is for coverage for Americans, it has not been effective in controlling cost, in integrating care and bringing the advances in medical treatment to all Americans.

INSKEEP: There are people who would argue with you about the effectiveness of Medicare or the efficiency of Medicare. I'll take the point that you have a different perspective on that, but I would just ask if you're not undermining your own argument. If the government is lousy at providing efficient health care, why is a public health plan a threat to you? You're just being more efficient than they are and make money.

Dr. NUSSBAUM: I believe we will be far more efficient than a government program. I think that when you look today…

INSKEEP: Well, then, why worry about it? Why not just let establish it and you won't lose any customers to them?

Dr. NUSSBAUM: Here's the issue, Steve, is that we're talking about competition not on a level playing field. The government can negotiate very different for health care costs. They can basically set unit cost reimbursement. They, today, set unit cost reimbursement approximately 20 percent below that paid by the public sector.

INSKEEP: Let me just translate that. You're saying that if a hospital provides a service, it's covered by insurance, Medicare, for example, would pay 20 percent less than WellPoint would pay for a patient with the same service.

Dr. NUSSBAUM: Exactly. On average, the private sector subsidizes government programs by approximately 20 percent.

INSKEEP: Oh, when you say subsidizing, you're arguing that that hospital makes up the shortfall for Medicare by charging you a little bit more.

Dr. NUSSBAUM: Absolutely. It's the hidden tax, the hidden cost shift.

INSKEEP: Given that lots of lawmakers are insisting on a public plan of some kind, but there's still some flexibility as to what kind of plan it would be, is there any form of a public plan or a government plan that you think WellPoint can accept and live with?

Dr. NUSSBAUM: We've talked about the fact that a government plan is not necessary to achieve the insurance market reform, the delivery system reform that is so necessary for Americans. We do not believe there is any need for a government plan.

INSKEEP: But I'm asking given the political realities of the situation, if somebody says to you and says, okay, look, we know you don't like it, but tell us what you can live with. Is there anything you can live with in this department?

Dr. NUSSBAUM: I think we have to look at the plans that exist today that are viewed as being government plans. The federal employees health benefit program…

INSKEEP: Mm-hmm.

Dr. NUSSBAUM: …that's a plan that is managed, that is run, that has all of the advantages of a private health insurance plan. And we at WellPoint are proud to provide benefits for 1.3 million federal employees under that program.

INSKEEP: It sounds like you're basically saying, look, we just don't want a government run health plan. We're just not going to sign on to that.

Dr. NUSSBAUM: That's correct. However, I think the American people need to understand that even the government health plan that has been most highly regarded, the government health plan that our senators and our congressmen and our president has access to is actually a plan run by the private sector.

INSKEEP: Dr. Nussbaum, one other question. Our correspondent Mara Liasson had a report last week that focused on the language that politicians use. For example, when President Obama talks about someone who is working with him, he'll describe that person as a stakeholder, whereas if they're working against the White House's agenda, they're a special interest. I'm wondering if right now you think you're a stakeholder or a special interest.

Dr. NUSSBAUM: That's a terrific question. Steve, I'd like to believe that we are a stakeholder, that we are collaborating strongly to produce and share our knowledge to produce health reform that is sustainable, that produces high quality health care, that makes the health care experience for all Americans as terrific as the clinical science and innovation that we have in America.

INSKEEP: Dr. Sam Nussbaum is chief medical officer for WellPoint. Thanks very much for your time.

Dr. NUSSBAUM: Thank you, Steve.

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