"It's quite possible," says Matt, "to imagine Congress constructing a bill that throws public-private competition overboard and then is structured so as to both increase health insurance firms' profitability and to give everyone health insurance. Again, the 2003 Medicare reform bill would be the model. Depending on the details, a bill like that might even be an improvement over the status quo (though I kind of doubt it)." I agree, that is quite possible. But I'm less worried about it than Matt. Imagine a scenario in which reform is passed, the public option is tossed under the bus, and what you're left with is a universal system in which insurers are simultaneously regulated (i.e, they have to insure everyone) and subsidized to retain current profits, or possibly even do better. That's obviously not my preferred vision for reform. But the institution of universality is actually very important here. Once everyone is in the system, that question is settled: We're not going to take health care away from anyone. The welfare state does not, in general, roll back its entitlements. But though the problems of access will be solved, cost will begin to terrorize the system. Spending growth is a real thing, and we'll have to stem it whether we want to or not. Politicians will, eventually, be left with one of two options: Cut benefits, or cut costs. And politicians really don't like to cut benefits. They pander to insurers, after all, because that gets them campaign contributions and helps them stay in office. It's an indirect way of pandering to voters, who have demonstrated a preference for candidates with large advertising budgets. But what voters hate even more than a small ad budget is anyone cutting their benefits. Put more simply, pissing off insurers creates an indirect threat, pissing off voters creates a direct one. So I'm pretty confident that such a situation pushes us towards cost control, albeit more slowly than I would like. That's not to say that reformers should accept or expect a gutted bill at the end of the process. My article on reform spends a lot of time arguing that you need a political strategy that pressures swing senators into supporting reform in order to ensure their own survival -- that's different than coming to them and giving them the power to dictate the final shape of the bill. But if that fails and a weakened reform succeeds, it's worth keeping in mind that universality changes the incentives for the whole system, and does so in almost entirely positive ways. That's why I think universality mechanisms like the mandate are so important -- it's about setting up the ground rules such that the system almost automatically improves over time.
