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Sunday, August 16, 2009

The Next Angry Mob

If you are looking for the next angry mob in the health care debate they are easy to find, head over to BenGoshi's page at DailyKos. With word coming out that Team Obama might be ready to dump the public option, the netroots are moving back to nutroots mode rather quickly.

Folks from Obama's team were all over the Sunday talk shows doing damage control on the President's signature domestic program. Since I've had a lot of damage control training in my life, I could tell by the efforts that they are at the stage of either save the ship soon, or abandon it. Right now I'd still give abandonment a 50/50 chance.

The folks at Kos are livid, taking the public option off the table and having them replaced by the Co-Ops the Senate has suggested makes getting to single payer a longer road. In fact, the Co-Ops might be the death knell for single payer.

Once the public see's that Co-Ops, operating under the rules the administration would like, are lead zeppelins that can't stay aloft they'll wonder how the government would make single payer work and not bankrupt us.

So what is the Co-Op that the left fears so much? It's basically an insurance pool, where groups or individuals can buy insurance, but with their combined buying power. They work great in many other areas of the economy, like agriculture, where farmers combine to buy seed, fuel and other commodities with group buying power. You can even look at Wal-Mart as a co-op, since the combined buying power of their thousands of stores gets the company lower prices than if they negotiated prices for each store.

Co-Ops can work, and the idea of funding them with a few billion to get them off the ground is a good idea. The problem will come if they are hamstrung with the pre-existing rules, instant coverage rules, etc. that Democrats would like to impose on all insurers. Under those rules they won't be able to break even, and keep premiums lower than buying individual policies.

The plus side to them is they do become a large insurance pool, helping to offset some of those loses by giving smaller employers and individuals the option of being in a group. But they can't offset all of the loses if they use the New York and Massachusetts rules.

How can they help the uninsured? Easy, use a refundable tax credit, based on adjusted gross income level, to help people pay their premium to the co-op if they don't get employer based insurance. Or, if employers wish to provide coverage to their employees through the co-op they would get the same tax write off that other employers do for what they pay for insurance.

Watch the blogs in the next few days, and get your laughs watching the left have fits over the idea of co-ops,

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