March 7th, 2009 – On Thursday March 5th, 2009 President Barack Obama hosted the Whitehouse Forum on Health Reform. Obama’s Health Reform Forum signals that in spite of economic downturn he is serious about trying to make some meaningful changes and also that he is smart enough to learn from past mistakes by inviting all the major industry players to participate.
Health reform has been something that every President since Harry Truman has promised to address. President Obama has the advantage of history to learn from the mistakes of the past, perhaps most notably the very public implosion of Hilary Clinton’s health proposal in 1994.
The major industry players seem to understand the seriousness of the problem. Karen Ignagni, President of health insurance industry lobbying group, America’s Health Insurance Plans, said, “You have our commitment to play, to contribute and to help pass health care reform this year.”
Also at the forum was Chip Kahn, President of the Federation of American Hospital Systems. Kahn was the mastermind behind the infamous “Harry and Louise” TV ads that helped sink the Hilary Clinton’s reform efforts during her husband’s presidency.
The Obama administration has some very sharp new players leading the charge for health reform and so far they have been very open with industry participants and the public about their efforts and goals. In fact, the Obama administration just launched a new web site: http://healthreform.gov/ to share information about their plans with the public.
Wisely, Obama is also taking a hard look at cost cutting. Any reader of Colorado Health Insurance Brokers blogs knows that rising health insurance premiums are a symptom of the larger problem of the skyrocketing underlying costs of health services. If Obama is able to reform the cost drivers in the health services sector that will go a long ways to curing the disease rather than just treating the symptoms.
Not surprisingly, with the recession, public support is waning some. While 66% of Americans supported higher taxes to help more families and businesses get health insurance when Hillary took her run at reform, today just 49% of those surveyed said they would be willing to pay higher taxes. Moreover a Gallup survey from December of 2008 showed that Americans still favor the current system, 49% to 41%.
So what does this mean to you? A single payer system run by the government is not under any serious consideration as there is not enough political currency or demand from the public to push forward radical change. Americans will still likely be able to keep their current health insurance through their employer or purchased individually. There may be an expansion of subsidies to help lower middle income Americans afford to purchase health insurance coverage.
I also hold out hope for a Universal Health Care Mandate that everyone must have health insurance coverage, whether provided by an employer, purchased individually or obtained through a government program like Medicaid. This will stop cost shifting for treatment of the uninsured to the insured. Also, with an enforceable universal health care mandate, America’s Health Insurance Plans, the industry lobby group, has said the health insurance industry will support covering everyone regardless of pre-existing conditions.
If everyone can get insurance from any health insurance carrier regardless of pre-existing conditions then Americans will have true plan portability. Plan portability for consumers means that the insurance industry will have to compete more effectively on value, service and price. These basic tenants of free market dynamics can only improve the insurance industry for the betterment of consumers.
But we must not forget Obama’s primary mission: The health services sector must be reformed as well, if there is to be any hope of controlling consumer and business health costs today and in the future.
What do you think? Please leave your comments below.