So, apparently an insurance company economist has admitted that private insurance could survive a public option, (h/t Digby):

"I believe the private system is important because it brings innovation, it brings energy, it brings change, it brings ideas that are often used in the public sector system as well," said Richard Collins, senior vice president for underwriting, pricing and health care economics at UnitedHealthcare. "I think we can have both a public and private system."

Predictably, progressive bloggers want to use this to sell the public option. Fair enough.

But why aren't executives scared of a public option any more? Because the public option as written in the two bills which contain it is so weak that it will not have significant, if any, pricing power.

The public option originally proposed by Hacker would have had over 100 million people enrolled in it. The current one would have, according the Congressional Budget Office, just over 10 million. No one with an employer plan would be allowed to join, it has no pre-enrollment, reimbursement is not linked to Medicare, doctors are not required to take it if they also take Medicare, and so on.

It's not a robust public option. It is questionable if it's even a viable public option.

I'd rather not have it if I were an insurance company exec, because once it exists it could always be improved, but in its current state, I certainly wouldn't be scared of it.

The fact that at least one insurance company executive isn't scared of the public option shouldn't be a cause for celebration, it should tell you that the public option has been horribly compromised.