Inslee gives public option first test in Washington state

Washington Gov. Jay Inslee (D), a long-shot presidential candidate, signed a law this week that will make his state the first in the nation to offer a public option health plan to compete with private companies, renewing debate over an approach that first gained prominence a decade ago.

The new health care plans — which will cover standard services and be available to all state residents by 2021 — are expected to be up to 10 percent cheaper than private insurance.

{mosads}When signing the bill into law, Inslee tied in his presidential ambitions, calling the public option a “template” for the U.S. Several states, including Colorado and Minnesota, are also exploring public option insurance.

“Washington does offer a chance to test that on a smaller scale,” said Jennifer Tolbert, director of state health reform at the Kaiser Family Foundation. “As Washington moves forward, it will help provide a test case for how a broader initiative could play out.”

State governments have often been the proving ground for health care reform in the U.S. But attempts to reshape health insurance at the state level have led to very different results over the years.

Massachusetts was successful in its implementation of RomneyCare, a precursor to ObamaCare with similar features, while a single-payer system in Vermont was never implemented because of high costs, making it an oft-cited example of “Medicare for All” opponents.

Washington’s new law is similar to the public option that was included in early drafts of the 2010 Affordable Care Act but stripped out because of opposition from moderate Democrats on Capitol Hill.

In all, six states are considering a public option in some capacity.

{mossecondads}The measure signed into law by Inslee, whose presidential campaign has focused mostly on climate change, would have been viewed as progressive 10 years ago. But now it is considered more moderate than some of the health care proposals from White House contenders, such as Sen. Bernie Sanders’s (I-Vt.) Medicare for All, which would shift everyone in the U.S. into a single plan run by the government.

Inslee’s plan may face some difficulties on the implementation front.

Participation in the plans will be voluntary for insurers and health care providers, which are necessary for the public option to work. Hospitals have longed complained that other public plans such as Medicare and Medicaid don’t pay high enough rates.

“It could be that state examples show this kind of policy would be more effective at the national level,” said Chiquita Brooks-LaSure, a managing director at Manatt Health.

The federal government has more levers it can pull to make a public option work, such as control of the Medicare program, she said.

The stroke of the governor’s pen comes as Democratic candidates in an ever-growing field of White House hopefuls are staking out their positions on health care reform, with Inslee and Sen. Amy Klobuchar (D-Minn.) being among those who prefer a national public option.

“I think it’s good that he’s trying to put this in his campaign because while climate change is an important issue to Democratic primary voters, it’s not the most important. They’re more concerned with health care than any other single issue,” said Democratic strategist Brad Bannon.

Democrats won back the House in the 2018 midterms by focusing largely on health care, and polls consistently show voters see the issue as the most important one heading into the 2020 elections.

Inslee faces a long climb to the top tier of the growing Democratic field of presidential candidates. Polling aggregators put him at about 1 percent support among voters, a threshold that qualifies him to participate in next month’s Democratic debates.

He also faces the challenge of distinguishing himself from two other governors of Western states who have entered the race: former Colo. Gov. John Hickenlooper (D) and Montana Gov. Steve Bullock (D), both of whom have said they support public options as an alternative to Medicare for All.

Unlike Hickenlooper and Bullock, Inslee can say he got his plan passed through the state legislature. 

But with a half-dozen states considering the public option, Inslee might soon find himself joined by other governors.

“This is a real attempt to look for options and solutions to address some of the problems we’re seeing in the marketplaces, primarily the costs and lack of affordable options for many consumers,” Tolbert said.