Price of health care plan is a doozy
President Obama is proposing to set aside $634 billion for health care reform over the next 10 years by raising taxes on the wealthy and cutting Medicare costs. Janet Babin reports.
President Barack Obama makes comments on the Fiscal Year 2010 budget in the Eisenhower Executive Office Building min Washington, D.C. (Jim Watson/AFP/Getty Images)
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KAI RYSSDAL: There is a certain element of "you've got to spend money to save money" in the president's budget plan. He's promising a major overhaul of the health care system, with universal coverage in a decade. But the price tag of that is a doozy: $684 billion over those 10 years as a downpayment.
From North Carolina Public Radio, Marketplace's Janet Babin reports now on how he's going to get there.
JANET BABIN: Some $600 billion sounds like a lot for universal health care. But analyst Steve Brozak at WBB Securities argues we don't understand how expensive our health care is right now:
Steve Brozak: Most people have a better idea of the real cost to get an oil change on their car than what it really costs to get a Cat scan. That's pretty ridiculous.
In fact, the government says the U.S. spends more than $2 trillion a year on health care now. And millions of people don't even get coverage.
The new plan pays for the reforms in two ways: taxes and spending cuts. The Obama administration would phase out tax cuts enacted during the Bush administration, for people who make more than $250,000 a year.
And the new plan would shrink payments to Medicare by $316 billion. That's the system that funds health care to the elderly and disabled.
Miller Tabak analyst Les Funtleyder wrote the book "Healthcare Investing." He says without reform the economy suffers:
Les Funtleyder: America is at a disadvantage to other places in the world who have single-payer systems. It does put a burden on our companies. I mean, even China has said they wanted to do a universal health care program.
Some Republicans complained today that the president's proposal is too expensive. They don't want to see breadwinners taxed more during a recession.
But Len Nichols with the non partisan New America Foundation says lawmakers may be closer to compromise than they let on.
Len Nichols: I know there is far more bipartisan conversation going on -- at least on the Senate side -- than is perhaps evident in public.
That behind-the-scenes wrangling will probably continue for a few more weeks. More details about the plan are expected to emerge in April.
I'm Janet Babin for Marketplace.
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From Renton, WA, 02/28/2009
Truly, I have to suppress giggling when I hear about how U.S. companies are at a disadvantage compared to companies in foreign countries that have government-organized health care. It is as though people believe the myth that government has money of its own to spend and that, therefore, it will be something for nothing. It doesn't and it isn't. It spends the taxpayers' money. I'm sure that individuals elsewhere pay higher taxes and I'd like to know what sort of corporate taxes are involved in supporting such programs. Corporations here hope that some of the burden will be transferred to somebody else. There are valid arguments for considering single-payer health care, such as my understanding that we pay more per person than any other modern country, but don't have the best results, but I don't see corporate competitiveness as such an argument.
From LA, CA, 02/28/2009
The only people that will benefit with national insurance are the insurance companies and drug companies. Why do you think they are for it? Right now your health care is analagous to a mom and pop,make way for the DMV to take over. The large ins. co. are happy to lower their prices as long as the masses come in, therefor more money overall. They will hire docs for almost nothing and push them to see as many patients as possible, regardless of quality. Your care will suck and their is nothing your doc can do for you. Its sad how naive everyone is when a few lofty words are thrown around. Health care is not hamburgers, docs can only see so many patients a day. Get ready for them to quit. Low salary providing poor care is not what they dreamed of while shelling out all the cash and time in school.People dont appreciate what they go through and blame them for the mess created by the third party insurance co. Obama's solution, give them all of the power. The HMO mess already has a lot of docs ready to quit.
From Winston-Salem, NC, 02/26/2009
634 billion over 10 years?
You've got to be kidding. When has any govt. agency ever provided a realistic estimate of the cost? The cost is at least triple.
From Toronto, ON, 02/26/2009
From what I hear, Pres. Obama wants to achieve healthcare cost savings through electronic health records. Heathcare IT can engender waste as well as savings. Clinicians can be stubborn about adopting electronic charts. They often work in a few places, each may have a different system, and the charts take a while to get used to. Don't get me wrong - I am for electronic charts, just not for cost savings. That said, the area of opportunity is in "practice management" software - i.e. the business of healthcare - and using the deep CMS pockets to drive standardzation. Here's an example of such a win that few know about - Universal Provider Identifier (UPI). Prior to UPI, one doctor could have as many ID numbers as the count of different insurance companies her patients used. When CMS required UPI about 18 months back, all the insurance companies were on board within 6 months!I believe the result was a reduction in billing errors, contested claims, and the need for administrative time to support that.
My position on this comes from advanced education (M.S.) in Health Informatics and 10 years in Healthcare IT work, including revenue analysis in the U.S. (Academic Health Center - Univ. of Minnesota), and cost analysis in Canada (Hospital for Sick Children - Toronto).
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