How to Save $85 Billion

Want to save $85 billion in health care costs? Enact a public option as part of health care reform. So says the CBO:

The public plan saves money because it pushes down premium prices. Lower premium prices across the country would mean the government would have to pay less in subsidies to low-income people who buy insurance through the exchange, according to CBO. Medicare rates are typically lower than those paid by private insurers, so using that formula would allow the public plan to charge considerably lower premiums to stay solvent. If the government has to negotiate the same way insurance companies do, public plan premiums likely won't be as low -- hence less savings.

Economist Duncan Black sticks his tongue in cheek and says, "I look forward to the Villagers pressing the fiscally responsible 'centrists' on why they'd rather waste money."

If he's waiting for the dead tree press and D.C. establishment, he'll wait a long time. The fact that a public option is cheaper than paying 40 percent more to pharmaceutical and health care corporations does not fit into their predetermined narrative, so it will be ignored.