One of the phrases I’m really tired of hearing is “a public option to compete with private ensurers” – with “…to compete…” thrown in thoughtlessly even by public-option supporters. No, the purpose of the public option is not to compete with anyone. It’s to provide coverage for those the insurers demonstrably do not want as customers anyway. The only danger of a public option will not be reduced competition. Rather, the danger is that it might actually encourage the cartels to act even more abusively, free from the worry that horror stories about people who were refused coverage and then died will drive further reform.

That said, I like the idea of exchanges as a primary way of reducing costs and expanding coverage. I’ve heard from multiple sources that small companies routinely pay three times as much per person as larger ones for the exact same coverage, and individuals pay even more. By allowing small companies and individuals to pool risk the way larger companies do, and also to capture the same economies of scale, one source of gross inefficiency is driven out of the system with little adverse effect on anyone except insurers who are levying a “monopoly premium” on smaller companies who have little recourse. That should address the concerns of those who think that they’ll have to fire someone so they can afford to do the right thing for the rest, though I’m sure they’ll still find some way to be dissatisfied with anything Obama proposes. Speaking of Obama, I particularly liked this part of his speech.

There may still be companies that refuse to do right by their workers by giving them coverage.

The problem is, such irresponsible behavior costs all the rest of us money. If there are affordable options and people still don’t sign up for health insurance, it means we pay for these people’s expensive emergency room visits.

If some businesses don’t provide workers health care, it forces the rest of us to pick up the tab when their workers get sick, and gives those businesses an unfair advantage over their competitors.

And unless everybody does their part, many of the insurance reforms we seek, especially requiring insurance companies to cover pre-existing conditions, just can’t be achieved.

The emergency-room and unfair-advantage points are similar to what I’ve said before. Failing to provide insurance doesn’t make health-care costs go away. In fact, it increases them when problems which are easily and inexpensively treated if caught early go untreated then, becoming much more expensive to treat later. It just shifts cost onto other premium-payers if treatment occurs after the person gets insurance elsewhere, or – even more money, more often – onto the tax-payer if they end up “indigent” in the ER. The indirect economic effects of people being forced into bankruptcy because of medical expenses, preventing other creditors from getting paid, shouldn’t be ignored either. It’s tempting to say that those who decide not to provide insurance should be held liable – both as corporations and as individuals – for employees’ unpaid medical costs, but that still wouldn’t be sufficient as long as they can take the bankruptcy route themselves. Maybe we should reserve debtors’ prisons for them, and see how many believe in their oft-avowed principles strongly enough to bet their own futures instead of somebody else’s.