Unemployment quickly morphs to uninsurance as those who lose jobs that could access health benefits under COBRA do not opt in as the cost of the program eats up a major portion (sometimes 100% or more) of the monthly unemployment benefit. Even with the stimulus package’s provisions to subsidize COBRA at 65%, there will continue to be those consumers who do not perceive an ability to afford the health benefit.
This will be an integral issue in the discussions for a public program’s inclusion in health reform in the U.S. Some argue that a public program will have lower administrative costs and be an important competitive foil vis-à-vis private insurers. The opposing view is that once a public program peeks its nose into the competitive arena, it will drive all private programs out of the market. There is some historical truth to this latter argument.
In this day and age, will Americans trust a private program? Will they trust a public program? As we listen to the wrath in Congressional talks this week on AIG bonuses and bailout, the program to revive the banking industry, ad nauseum, it is hard to pick where American citizens will identify trust — except in each other, as seen in the continued bonding of citizens involved in countless, varied and resilient social networks.