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White House Adviser Romer Tells AlterNet She Is "Personally Persuaded" On Value of Public Option

When asked to explain her qualified endorsement of the public option in a health-care speech, Obama's economic adviser says it can work to contain costs.
 
 
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In a speech to journalists and policy-makers, Christina Romer, PhD, chair of the White House Council of Economic Advisers, offered a list of provisions in the various health-care reform bills currently before Congress that will help to contain costs and reduce the deficit over the long run. Included on her list the tax on high-priced plans proposed by Sen. John Kerry, D-Mass., (a provision opposed by the AFL-CIO), payment reforms in Medicare and last but not least, kinda, sorta maybe a public health insurance plan.

In her prepared remarks, Romer cited a public option as a "potentially important source of cost containment." Why the modifier, AlterNet asked her during the Q & A. Sounds like a bit of a hedge at a moment where the public option is a major issue in the progressive community.

"I was certainly planning to present all three of these [proposals] as important," Romer said. But the broader agreement among economists, she said, was for "something like the Kerry proposal."

"I have been personally quite persuaded," Romer continued, "that the public option certainly can be an important source of cost-growth containment."

As an example, Romer cited research done by her senior economist, Mark Duggan, on California counties with a dual plan structure, in which Medicaid patients are enrolled in one of two competing plans. In counties where all the Medicaid care was contracted to two competing, privately-run plans, costs grew more rapidly, Romer said, than in counties where a private plan was forced to compete against a public plan.

"It's a small sample...," Romer said, adding that whether or not the same results would hold throughout the country remained a question. But, she said, it's "one of the things that is giving me a sense that it could be something that could genuinely slow the growth rate of costs."

So, if that's the case, why doesn't the administration make the case, and start twisting a few arms?

Adele M. Stan is AlterNet's Washington bureau chief.