The mail delivery and heath care industries couldn't be more different, right? Dissimilar as they are in form, they are both public services. So we've been geting a taste what a public-private health system would look like in the mail transport industry. It's not the ugliest thing in the world, but it's not pretty.
In the mail delivery, there are three main agents; the U.S. Post Office, United Parcel service (NYSE:UPS), and the third, entrepreneurial one, the misnamed Federal Express (a private company despite its name). Of the three, the not-for profit Post Office is the least efficient; as a government agency, it has the equivalent of "union rules." The next is UPS, favored by the government, particularly the Obama Administration, because it is unionized. Fedex is non-union, therefore the fastest and most efficient of all.
The government has given its "favorite son," UPS, a lift in the recent tough times. Nevertheless, UPS was unable to maintain its AAA rating (and which "A Modern Approach to Graham and Dodd Investing" opined that they never really had). Fedex, on the other hand, has been taking it on the chin without government help. It is certaintly capable of competing, but doesn't have the market share it would normally command without government interference.
Obama's health care plan would probably work much the same way. Government-sponsored Medicaid and Medicare would expand greatly in scope. In addition, ther would be a government-favored "private sector" (mainly union run). Finally, there would be a true private sector that would be the most efficient, but inaccesible to people who can't pay their own way because of the absence of government subsidies that would apply to the other health programs. As such, it would be tolerated, but not allowed to thrive.