Unbundling Health-Care Derivatives

With a goal of passing legislation by June, Congress is getting serious about health care reform, and advocates of change are more nervous about their allies than about lobbyists defending the current failed system.

"More than 70 House Democrats," the Washington Post reports, "recently warned party leaders that they will not support a broad health reform bill that does not offer consumers a government-sponsored policy, and two unions withdrew from a high-profile health coalition because it would not endorse a public plan."

Their action was prompted by suggestions that the Obama Administration may be willing to compromise on that aspect of providing universal coverage.

The health-care crisis, like the home-mortgage meltdown, has no simple solution but there are similarities in their origins--the greedy intervention of third parties to profit from what used to be transactions between buyers and sellers.

Like the derivatives that wrecked the housing market, profit-seeking insurers have created a convoluted system that siphons off one out of every three health-care dollars for themselves, giving Americans less care for more money than any place else in the developed world.

In reform legislation, it's crucial to include what has been called a Medicare-for-All option that would give consumers a chance to buy care directly and pressure private insurers to improve what they offer.

Without such a choice, health-care "reform" could turn out to be like Wall Street bailouts that shovel money to Citibank, Bank of America and AIG and leave all the decisions about spending it to their discretion.