WASHINGTON BUREAU – President Barack Obama now has listed what he says are 3 elements that must be included in any health reform legislation that he is willing to sign.
Obama says an acceptable health reform package must provide consumer protections for those with insurance; create an exchange that individuals and small businesses can use to buy affordable coverage; and establish a requirement that people who can afford insurance have insurance.
Any individual health coverage mandate should include hardship exemptions, Obama said.
Obama also called for health insurance tax credits for small businesses and for uninsured individuals; a requirement that most employers provide health coverage; and medical malpractice reforms.
Obama recommended that Congress adopt a proposal suggested by Sen. John McCain, R-Ariz., during the presidential campaign to rein in defensive medicine costs by limiting medical malpractice lawsuits. Obama said the U.S. Department of Health and Human Services should start demonstration projects in states to test new models to address medical malpractice.
Obama endorsed consideration of a mechanism that would automatically reduce the growth of Medicare if health care reform mandates failed to produce the expected amount of savings.
Obama emphasized his support for a nonprofit, government-run, “public option” health plan, but he said other approaches might be acceptable.
He cited, as an example of an alternative that might be acceptable, a proposal circulating in the Senate Finance Committee that would create a public option “trigger.” Under that approach, health reform legislation might use nonprofit health cooperatives as an alternative to the public option plan, or require creation of a public option plan program if private insurers fail to provide high-quality health coverage at affordable rates.
Obama praised a proposal developed by Sen. Max Baucus, D-Mont., chairman of the Senate Finance Committee, that would impose a fee on insurance companies that offer expensive, “Cadillac” health insurance policies.” Baucus has suggested imposing a 35% excise tax on insurers that sell policies costing more than $8,000 for an individual or $21,000 for a family. The tax would apply to the amount of premiums above the threshold.
Baucus says that, early next week, he will introduce a bill that will form the basis for a Finance Committee markup that will take place the following week. “The time has come for action and we will act,” Baucus says. “We must move forward if we are going to get this bill done by the end of the year…. This is our moment. We have spent many weeks and months on this crucial issue. Now is the time to move forward.”
The president has estimated the cost of implementing the kinds of health system changes that he and many congressional Democrats want to see adopted to be about $900 billion over 10 years.
Obama said he wants to “hold insurance companies accountable,” but he also said, “I have no interest in putting insurance companies out of business.”
Insurance companies “provide a legitimate service, and employ a lot of our friends and neighbors,” Obama said.
Washington Analysis, Washington, says the president’s speech was “not a game changer.”
Whether Congress passes a bill by regular order or through the budget reconciliation process, “the bill has to be more middle-of-the-road (and therefore more likely to be based on the proposal being developed by the Senate Finance Committee,” analysts at the firm write in a comment on the address.
The House health system bill and the other major Senate health system bill both would include a public option plan, the analysts write.