The New Haven Independent reports that Sen. Joe Lieberman (D – CT) is leading a coalition of “centrists” and “moderates” against a public option for healthcare—a government-run health plan that would compete with private insurers. As we recently discussed, the public option is supported by about three-quarters of the public, who, in the terms of the Congressional debate, presumably represent the “extremists” and “partisans” of the political spectrum.

We also recently pointed out how Congressional opposition to the public option seems to be coming from those who represent small states whose healthcare markets are dominated by a local monopoly.

About a month ago, Health Care for America Now and Sen. Chuck Schumer (D – NY) released a detailed report that analyzed the healthcare markets in all fifty states. The report concluded:

[E]xtreme health insurance industry consolidation has resulted in a market failure where a small number of large companies use their concentrated power to control premium levels, benefit packages, and provider payments in the markets they dominate. As a result, health insurance premiums have skyrocketed, going up more than 87% – on average – over the past six years.

How did Connecticut fare in the report’s analysis? WellPoint Inc., the state’s biggest insurer, controls 55 percent of the market, which makes it “highly concentrated” under Department of Justice guidelines. In a highly concentrated market, “an insurer could raise premiums and/or reduce the variety of plans or quality of services offered to customers with impunity.” This is perhaps why health insurance premiums in Connecticut increased 81 percent between 2000 and 2007.


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