Hospitals Would Get Paid 32% Less in Public Plan Compared to Private Insurers

The Lewin analysis examined two scenarios that would result from decisions by Commissioner of Health Choices, who would determine (as proposed under the House bill) who is eligible to participate under the health exchange with a public plan option. In the first scenario, the commissioner would limit eligibility to individuals and employers with fewer than 20 workers. In the alternative scenario, the commissioner would permit all individuals and employers to enroll.

"Our independent study shows how the decision whether or not to include all employers in the public option will have a profound impact on the costs of this legislation on government, employers and families," said John Sheils, vice president of The Lewin Group, in a statement.

According to the report's predictions:

• Public plan enrollment would be 33.6 million if the exchange was open only to small firms, and 103.4 million if the exchange was open to all. (This would be a 48.4% reduction in the number of people with private insurance, which is currently 172.5 million people, the report noted.)


• Private plan enrollment would decrease by 34.9 million if the exchange was open only to small firms, and decrease by 83.4 million if the exchange was open to all.

Family health spending would tend to increase under the House bill for the uninsured, the report said. Those families with one or more uninsured members would see their health spending increase by an average of $1,272 per family--assuming all workers have access to the public plan through the exchange.