Market forces, investors, for-profit corporations, and entrepreneurs are now at the center of the U.S. system, and generation of income is a dominant consideration for most private providers of health care - including those that are not investor owned." (Not-for-profits must adopt the same perverse behaviors of the for-profits to remain competitive with them.)

The health insurance industry spends a significant amount of it on administrative services designed to ensure that they can keep as much of that money as possible. There has been little incentive to digitize the keeping of medical records - on-line access to records, smart cards, etc., because Wall Street wants these companies to make money not spend it.

With the introduction of a public option, investors in private companies will be running for the door.

As for adverse selection, the government already takes care of those citizens with the greatest need -- seniors.. Expect Medicare and Medicaid to be more properly funded. Also look to see most people, as well as those with preconditions, opt for the public option as businesses will vote their own interests and opt for the public option to cover their employees.

The private companies that survive will be non-profit..  Perhaps they will offer boutique service to wealthier clients forming a two tier system. 

Assuming the plan proposed by the House becomes law and is successful, there will still be greater savings to be found in a Single Payer system and far less monied opposition to it.

In this version of the bill, they buy it directly, like Medicare.  It would have its own administration through HHS.

It doesn't have a number yet, as it is still classified as a "draft."

You can download the full bill here:

http://edlabor.house.gov/documents/111/pdf/publications/DraftHealthCareReform-BillText.pdf

It doesn't have a bill number yet because it hasn't gone through the CBO yet, but the draft is on the Education and Labor Committee's web site. Don't know if this link will go thru:

http://edlabor.house.gov/blog/2009/06/health-care-reform-house-dems.shtml

Medicare For All would certainly be a massive savings. Even if we funded it lavishly like the French and Japanese do (and got their results, which are amongst the best in the world with no waiting lists and ready access to the latest medical technology), we would still save at least 5% of GDP on health care costs due to lower administrative costs and ease of controlling costs w/the massive bargaining power of a client pool consisting of the entire population of the USA. And Medicare For All would not require an 850 page bill to guarantee universal medical care for all Americans. However, Democrats in their Presidential primary voted against the only candidate proposing Medicare For All and instead voted for the candidate proposing the weakest medical plan of all the Democratic candidates. Obama is just giving us what he promised (actually a little better than he promised). If you're a Democrat and you voted for Obama in the primaries, congratulations -- this is what you voted for.

In the meantime, this is what the President promised, what the President wants, and it's a bill I can live with -- literally, since I'm approaching my 50's and right now health insurance is basically unobtainium and as a single male I do not qualify for Medicaid under current law. I would leave off a couple of "very" in the title but if this bill makes it through largely as-is without being gutted, it would be a very fine bill indeed. Not perfect, but little is when it comes to politics...

I hate to nitpick, but I think both of the following are acutally important points that get to the central paradox of health care reform:

*  France and Japan actually spend way, way, way less per person than we do.  The whole point is that they do not spend lavishly, but achieve much better results all the same.  In 2006 dollars per person, we spent $6,401, France spent $3,374 and Japan spent $2,358.  If we had French levels of spending, we would spend $1 trillion less on health care than we currently do.  If that doesn't convince you our system is riddled with fat, I don't know what will.

*  Japan doesn't have Medicare for All or even single-payer.  Primarily they use nonprofit employer-based insurance.  Which is important to the extent that there is no one perfect solution -- Japan's works for them but would we'd have a tougher time implementing it here than we would Medicare for All.  It also frankly puts the lie to the notion that private insurance needs the bizarrely high administrative costs of American insurance -- Japan has more private insurance companies than we do, and Switzerland and France nearly as many.  They seem to be doing just fine without crossing the line from amoral business practices to immoral.

Previous posts on Japan:

http://healthcare.change.org/blog/view/turning_japanese_we_could_do_a_lot_worse

And France:

http://healthcare.change.org/blog/view/5_questions_about_french_health_care

... for those so inclined.

I should perhaps have made it clear that I was talking about lavish funding *compared to other single-payer systems*. The current US system is so ridiculously ludicrously expensive that even if you over-funded a single-payer system to replace it by a ludicrous amount, you'd still save over $600B/year on our annual $2.3T health care costs. 

BTW, I am aware of your absolute dollar costs but I prefer to use the percentage of GDP as a more accurate measure of the national affordability of a health system. France spends half as much as the US in absolute dollar amounts, but around 10.5% of their GDP vs. around 15.5% for the US so in terms of affordability they are at about 2/3rds the cost of the US. The US economy is much larger in absolute per-capita terms so if we funded a single-payer system at 10.5% of GDP we would still be funding much more lavishly than the French.

My main concern with the House plan is that it is nowhere near as efficient as Medicare For All at solving the affordability problem. But as I noted, it's a plan I can live with -- literally.

[And yes, I had a brain fart on the Japan thing, I knew better :} ]