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Pay no attention to the people behind the curtain

Wednesday, September 30, 2009


by folkbum

Christian Schneider, writing at WPRI, fails to prove his thesis:
At the center of the debate is the idea of a “public option:” a government-run health program that liberals say would merely compete with private plans for customers. Conservatives counter that historically, when a generous government plan is instituted, private businesses tend to scale back or even drop their health plans, so their employees can save them money by going on the public plan.
On the one hand, this seems moderately logical--employers will shirk their traditional responsibilities to let someone else do it. On the other hand, it is completely disproved by the facts. Pesky things, those facts.

Schneider uses the experience of Wisconsin and BadgerCare to "prove" that this happens. Because BadgerCare enrollment exceeds what was expected when the program was passed (in arguably unusually strong economic times) in 1997, Schneider implies, that must mean that employers have shed coverage like crazy here in Wisconsin. And, he goes on, any further reform of health care, at the national level, for example, would lead to employers doing the same.

Pesky facts! It turns out that Wisconsin has not seen a massive shift from private to public insurance since the advent of BadgerCare! Scroll down to tables 7 and 8 of this report. Table 7 notes the percentage change in coverage provided by employers in all states between 2000 (when, coincidentally, BadgerCare took effect) to 2004 (which is the year Schneider notes BadgerCare saw peak enrollment). While Wisconsin declined at a slightly higher rate that nationwide (6.5% vs, 4.6%), Wisconsin still handily beat the national average, with, in fact, the 7th highest rate of employer-provided coverage in the country in 2004.

Is it possible that some of the people who lost coverage in that period did so because employers dumped them onto BadgerCare? We can't rule that out. However, it is pretty clear from Wisconsin's continued high rates of employer-provided health insurance, even in the face of BadgerCare, that Schneider's theory of mass shifts to the "public plan" never happened. Wisconsin employers still, overwhelmingly and at a much higher rate than the national average, offer insurance coverage to their workers.

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