"Essential benefits package" provision is the real government takeover

One of the primary elements of both the House and Senate plan is this concept of the "essential benefits package". In order for an insurance plan to qualify to be sold on the newly created health insurance exchange, the government will require that the insurance plan provide certain minimum benefits. A "benefits committee", known as the Health Benefits Advisory Council will be headed by the Surgeon General and made up "experts" appointed by the President from both inside and outside the government. The committee will make recommendations on the services that must be covered and included in the essential benefits package.

The first and most obvious comment is that if someone has a plan that does not currently include all of the benefits that the government deems essential, then the insurance provider will be forced to change the plan to provide them. This clearly violates the President's promise that no one will be required to change their existing plan.

Second of all, how in the world are costs supposed to go down if the government is requiring insurance companies to offer even more benefits? The best path toward lowering costs is to reduce the role of insurance in the health care industry and promote (or at least put on equal footing) insurance plans that have fewer benefits, but this plan does the exact opposite.

And most importantly, this element of the plan, along with guaranteed issue and community rating, is just as problematic if not more so than the "public option". The government doesn't need its own insurance company in order to control the entire industry. The "essential benefits package" mandates will represent the real government takeover.

Maybe one of the strategies all along was to put the public option out there, divert attention away from the real government takeover, and at the last minute take out the public option to get the bill passed. Then what will happen? The new mandates, along with guaranteed issue and community rating requirements, will cause premiums to skyrocket. The President will then come back to the public and say, "We gave the insurance companies a chance, but it's now clear the only way to keep them honest is with a public option". Perhaps they are not that clever, but it could end up working out that way.

[Update]

Here is an interesting white paper from the Center on Budget and Policy Priorities on the need to design minimum benefit standards. The paper recommends "limits" on both the "degree of variation in different benefit designs" and on the "number of different plan choices". Doesn't sound very competitive, does it. It also states that:

Although minimum coverage standards are critical, it is neither necessary nor desirable to try to write the particulars of those standards into legislation. The legislation need only establish the broad parameters of the benefit standards and charge the exchange or some other federal standard-setting entity with developing the specifics. This will simplify the passage of legislation and allow the benefit standards to be updated or modified over time in accordance with advances in medical research and practice.

So, don't be specific about the "essential benefits", just give the government the power to control what must be covered so that the bill can more easily pass. Scary stuff.