Periodically, we hear elected leaders promoting what seems like a free
lunch: hand-over control of government services or government assets to
private industry and services will improve at a lower cost. Like most
promises of a free lunch, privatization of government services ”“ also
known as "contracting out" or "public-private partnerships"”“ has
rarely delivered on its promises, with most studies showing little gain
and often substantial losses for the public.
Nevada is exploring privatization
of its mental health services, citing the difficulty of finding
psychiatrists for its state-operated psychiatric hospital and a
shortage of mental health care services in rural communities. Yet,
privatization is not the easy fix it's often sold as and raises
concerns of accountability and quality inherent in contracting out
public services to private firms.
A perfect storm is brewing around the shady business practices of a private Florida insurance company that covers 2.3 million
Medicaid and Medicare beneficiaries nationwide, including a raid by
federal and state agents, allegations of fraud, a subsidiary in the
Cayman Islands, signing up dead people, and excessive profits gleaned
from government contracts. This sounds like a bad B-movie caper
directed by Dick Cheney, but it is an all-too-real account of Medicaid
and Medicare privatization going sour.
in July, the compromise legislation to reauthorize and expand the
State Children's Health Insurance Program (SCHIP) that is emerging in
Congress is more like the weaker Senate bill than the House's
broader proposal. Still, the compromise would bring
enrollment to 10 million children, up from 6.6 million and cover an
million uninsured children. SCHIP is an important state-federal program
to state efforts to ensure children have the health care they need when
they need it.
Despite claims by the Bush administration that extending SCHIP health coverage
to more kids will undermine private health coverage,
data from the Economic Policy Institute emphasizes that 86% of
SCHIP enrollees either had no coverage or lost coverage within the six months
before signing up. And even the majority of those with private coverage who
switched over to SCHIP cited the lack of affordability of that private
coverage as the need to enroll.