And why a public option is therefore compatible with free markets:
Something like televisions exist in a free market because consumers, if they don't like any of the new TVs on the market, can simply keep their old one. If they really don't like the market, they can even forgo owning one altogether; it will make you unpopular on game day, but it won't risk your life. Insurance is different. Anyone with a sense of basic self-preservation has no choice but to buy health insurance every single month. You cannot opt out, there are few options to choose from, and it's difficult to know how to price your future risk of injury. So health insurance companies have distorted incentives to innovate or provide a more cost-effective product.
A public option would, crazy as it might sound, make health insurance a free market.
If there exists a government-run plan, which by all accounts would be basic and geared towards affordability, consumers will have the ability to opt out of the private insurance market. Private providers would finally have real incentives to provide a better product and innovate by building an insurance plan stronger than public insurance. Fears that a public option might decree certain treatments "not cost-effective," which are not as outlandish as some liberals think, should delight free-market conservatives because it would be an opportunity for private insurers to step in. Worried you might develop a condition requiring $60,000 medication that no public option would ever include? Buy a blinged-out private plan that, for an increased premium, will.
Makes sense to me. Or the private sector can also compete for the best discount insurance plan - kinda like Sprint airways for your body.