Undaunted by the economy, Obama presses ahead on healthcare reform
| Washington
President Barack Obama is pressing forward this week with plans to recast American healthcare despite the nation鈥檚 worsening economic condition, ignoring criticism that he is taking on too much.
On Monday, President Obama introduced his new nominee for secretary of health and human services, Kansas Gov. Kathleen Sebelius (D), who will play a central role in the reform effort. On Thursday, the White House will hold a major policy summit about runaway healthcare costs.
Since unveiling his proposed budget last week, which includes $634 billion toward universal health coverage, critics have said reform should wait until the economy improves. But Obama insists he was elected to provide 鈥渟weeping change,鈥� and budget analysts say healthcare spending is a key factor in the nation鈥檚 chronic deficits.
鈥淭he high rate of growth of healthcare costs is at the root of the nation鈥檚 long-term fiscal problem,鈥� writes Robert Greenstein, executive director of the Center on Budget and Policy Priorities in Washington, in a statement on the center鈥檚 website.
The costs of public healthcare programs are increasing at a rate well above overall inflation, consuming more of the federal budget.
Thursday鈥檚 healthcare summit will bring together members of Congress from both parties as well as stakeholders and advocacy groups in the healthcare industry.
鈥淭hey鈥檒l be testing the waters鈥� at Thursday鈥檚 healthcare summit, says Maggie Mahar, a healthcare fellow at the Century Foundation in New York. 鈥淥bama will take whatever he can get from it.鈥�
鈥淗e knows that if a Republican stands up and says something reasonable, [budget director Peter] Orszag will say, 鈥業鈥檓 glad to hear someone say this, it鈥檚 a brilliant idea,鈥� she adds.
The beginnings of Obama鈥檚 effort at healthcare reform come in marked contrast to the failed effort by the Clinton administration 16 years ago, when then-first lady Hillary Clinton led a task force that conducted its business behind closed doors and issued a 1,000-plus page plan that sank under its own weight. In his budget outline, Obama signaled his intentions by setting up a reserve fund of $634 billion 鈥� more than half the $1 trillion needed over the next decade to put reforms into practice. Half the $634 billion would come from tax increases. The other half from program changes, including efficiencies to Medicare and Medicaid, the government鈥檚 health programs for the elderly and the poor, and higher discounts from pharmaceutical companies for Medicare drugs.
The nomination Monday of Governor Sebelius for the Health and Human Services job helps Obama move beyond the withdrawal of his first choice, former Sen. Tom Daschle of South Dakota. Mr. Daschle, one of Obama鈥檚 closest confidants during the campaign, dropped out a month ago when it came out that he owed $128,000 in back taxes. The withdrawal deprived Obama of a key player in his health reform effort, especially given Daschle鈥檚 background as onetime Senate majority leader.
As a two-term Democratic governor in a Republican state, Sebelius brings her ability to work across the aisle. In addition, Sebelius was Kansas鈥檚 insurance commissioner for eight years. Her knowledge of how the healthcare system works at the state level, which is critical to any federal reform, would also help her in Washington. Some conservatives pledged to drum up opposition over her support of abortion rights despite her Catholic faith, but she is expected to be confirmed.
Sebelius is not expected, however, to be appointed White House 鈥渉ealth czar,鈥� a second hat Daschle was to wear. Instead, Obama has named Nancy-Ann DeParle to serve as counselor to the president and director of the White House Office for Health Reform. The White House describes her as 鈥渙ne of the nation鈥檚 leading experts on healthcare and regulatory issues.鈥� But she will not play the high-profile role that Daschle would have, or that Mr. Orszag, the budget director, already is playing on healthcare.
鈥淗ealthcare is the key to our fiscal future,鈥� Orszag said Sunday on ABC鈥檚 鈥淭his Week.鈥� 鈥淲e are going to make sure that it is ... self-financing over the next 5 to 10 years, which means if that revenue stream isn鈥檛 available, something else will have to be. And in addition, those reforms to healthcare, making the system more efficient, will help ... vastly improve our long-term fiscal future.鈥�
Not all budget watchdogs believe it is possible to reform the healthcare system and bring down its runaway costs at the same time. David Walker, the former comptroller general of the United States, believes Obama should focus on cost-cutting first, then reform.
鈥淏efore we expand coverage, which we know is going to cost a lot of money, we need to be able to demonstrate 鈥� not based on theory, but based upon actual practice 鈥� that we can reduce the rate of increase of healthcare costs,鈥� says Mr. Walker, now president and CEO of the Peter G. Peterson Foundation. 鈥淎nd we need to make a significant down payment on our tens of trillions of dollars of unfunded healthcare obligations right now.鈥�
He adds: 鈥淚t鈥檚 all too easy to expand coverage and say we鈥檙e paying for it based on some theoretical savings that we hope we will end up achieving through various reforms.鈥�
