Tuesday, June 23, 2009

Obama using political wealth for health reform

Business Times - 24 Jun 2009


Obama using political wealth for health reform

The President is intent on getting the healthcare legislation passed by Congress this year

By LEON HADAR
WASHINGTON CORRESPONDENT

IT'S beginning to feel as though the American political system is reverting to an election campaign mode. Is President Barack Obama running for re-election?

That was at least the impression of journalists who were covering Mr Obama's announcement on Monday that he was going to use all the weapons in his political arsenal to win the coming fight in Congress and around the country over his plan to reform the nation's ailing healthcare system.

It was clearly one of the major opening shots in what are expected to be long and costly political and legislative battles over health care.

'Yes we can,' Mr Obama told reporters at the White House as he discussed the decision by the drug companies to put a price ceiling on prescription drug coverage for the elderly that is offered through the federal government programme Medicare.

'We are going to get this done,' he said, referring to his healthcare programme, suggesting that the agreement by the pharmaceutical companies could serve as a model for similar cooperation between government and the medical industry on reducing healthcare costs.

'This is a significant breakthrough on the road to healthcare reform,' Mr Obama said, 'one that will make a difference in the lives of many older Americans.'

The launch of the White House's campaign for healthcare reform is taking place at a time when Mr Obama is beginning to slip in the public opinion polls and as both Democrats and the media are becoming more sceptical of his policies.

While most opinion polls suggest that Mr Obama continues to enjoy wide public backing for his leadership, Americans seem to be much less supportive of his key policy initiatives, including the effort to save General Motors and Chrysler, and are worried about the increasing fiscal costs of his programmes to fix the American economy. Hence concerns over the growing budget deficit seem to be rising to the top of the public's agenda.

In that context, while most Americans are in favour of ensuring that every citizen has access to health care, they are much less enthusiastic about the notion that reforming the system could require new and huge government spending.

In fact, leading Democratic lawmakers on Capitol Hill are worried that Mr Obama may not be able to win approval on Capitol Hill despite the fact that his party now controls both the House of Representatives and the Senate.

'To be candid with you, I don't know that he has the votes right now,' Democratic Senator Dianne Feinstein of California said on CNN on Sunday. 'I think there's a lot of concern in the Democratic caucus.'

Which explains why Mr Obama is trying to revive some of the passion exhibited by his supporters during the presidential campaign which helped get him elected last November.

Mr Obama explained during the 2008 election campaign that, taking into consideration the strong political opposition, he would not propose a single-payer system like the one that operates across the border in Canada.

In fact, the Obama administration has not put forward a very specific healthcare plan. Instead, it is proposing a general direction for reform and leaving the details of the plan up to Congress where debate over the issue is expected to begin this week.

According to the broad parameters of Mr Obama's plan, the current private insurance programme will continue to exist with the government exerting more regulation over their operations by imposing practice guidelines on providers.

Coverage would be mandated for employers and individuals and a government-run plan would be set up in competition with private insurers.

Americans would be able to choose either private insurance or the public plan, but the private insurance would face a host of new regulations that are expected, among other things, to prohibit pricing premiums on the basis of risk.

And on the top of all of that, the government would offer financial aid to low-income people to purchase insurance.

Most experts agree that the rising cost of health care in the United States poses a long-term threat to the country's fiscal health. And critics of Mr Obama's ideas for reform argue that it will not bring down the cost of health care and, if anything, could end up costing more than US$1 trillion over the next 10 years (according to estimates by the non-partisan Congressional Budget Office).

This burden will probably fall mostly on the middle class through direct and indirect taxes.

Moreover, many lawmakers are worried that the government-backed healthcare programme would force private insurers to raise their premiums and make them less competitive.

Mr Obama and his aides have indicated that they are ready to work together with Congress to reach a compromise on the healthcare legislation.

But as Mr Obama made it clear on Monday, he was intent on getting the legislation this year when the White House still has quite a lot of political capital to spend and before Washington starts getting ready for the midterm Congressional elections next year when the incumbent party could start losing Congressional seats, making it even less likely that Congress would support reforming health care.

Mr Obama was clearly encouraged by data in a New York Times report that showed strong public support for a government-run insurance plan that would compete against today's private plans.

Similarly, a Wall Street Journal-NBC poll found that more than half of respondents support the Obama approach and 62 per cent said they would support a requirement that every American have insurance.

Indeed, aides to the President insist that he is ready to take advantage of his personal popularity and to use the Internet and other new media to go directly to the American people - in the same way he did during the election campaign - and ask them to press the reluctant Republicans and Democrats on Capitol Hill to pass a healthcare reform bill.

Who knows? We may start seeing the cool Obama losing his temper for a change.



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