President Obama’s budget proposal today lays out how he will come up with the $634 billion over the next decade to begin getting all Americans much-need health coverage. And next week, he'll gather health care experts and other stakeholders to begin laying out specific proposals for a health reform plan, with recommendations expected in 30 days.

As the pundits look over the President's budget, they tend to agree that his mix of cost-cutting, quality incentives and tax increases fairly spreads the cost of paying for health care among all involved.

A good chunk of the money is expected to come from cutting the fat from private Medicare Advantage plans, a battle that has been fought for years in Congress. For the unfamiliar, Medicare Advantage plans offer seniors different coverage features than Medicare, but are run by private-insurance companies (with their need for profit margins), yet are paid with taxpayer dollars. They end up costing taxpayers about 14 percent more than Medicare would spend to care for seniors directly. No doubt that the big insurance companies will be fighting this again.

The President drew his line in the sand on cost-cutting, saying in his budget proposal:

“We also will fundamentally reform our health care system, delivering quality care to more Americans while reducing costs for us all. This will make our businesses more competitive and ease a significant and growing burden middle-class families are bearing."

" We need to put tired ideologies aside, and ask not whether our Government is too big or too small, or whether it is the problem or the solution, but whether it is working for the American people. Where it does not, we will stop spending taxpayer dollars; where it has proven to be effective, we will invest.”

Some of the more significant cost-cutting items in the budget proposal to fund health care reform include over the next decade::

• Establish competitive bidding programs for those Medicare Advantage plans, which is expected to generate about one-third of the money by eliminating government subsidies to private insurance companies: $176.6 billion.
• Cutting payments for poor care, namely to hospitals that re-admit Medicare patients. As the Washington Post reports, “experts have identified hospital readmissions -- especially for elderly patients -- as a sign of poor care and unnecessary expense. About 18 percent of Medicare patients are readmitted to the hospital within 30 days of an original visit." Many of those include patients who get infections while in the hospital. This new approach would establish flat fees for the first hospitalization and 30 days of follow-up. $8.4 billion.
• Requiring drug companies pay higher ‘rebates’ to the federal government for the medications they sell to Medicaid patients. $19.5 billion.
• Develop the guidelines to create safe, generic versions of biologic drugs – those drugs not made from chemical compounds, but from living organisms. Diabetes medications and cancer drugs are among those made from biologics. $9.2 billion.
• Require wealthier seniors to pay higher premiums for their Medicare Part D prescription drug coverage, like they do for Medicare doctor visits. $8.1 billion

Next up on the President’s health reform agenda is a summit next week focused solely on health care, with specific recommendations due out in a month. Inside Health Policy reports those will include a multi-pronged reform effort that will include both Executive Orders issued by Obama as well as legislation. " ...In other cases, it’s going to require some legislative decisions, and we’re going to collaborate closely with the relevant chairs and committees that have jurisdiction," the President said. Legislative leaders seem ready to roll-up their sleeves, with Senate heavy-hitters Kennedy and Baucus committing to reform in a joint Wall Street Journal piece.

The President’s bold moves to commit to health reform this year, develop a pot of money first before laying out a specific plan, and bringing together key stakeholders early on, is a positive sign that health reform will make significant strides in 2009.

comments (5)

YOU ALL ARE CRAZY. Do you think at a time of massive budget deficits and government total spending heading toward an abyss, we can become a nanny state and take care of everyone and everything through endless spending. Your are crazy. We are heading towards a cliff at full tilt, and you want to adjust the throttle?? If gov can't manage the budget, the economy, the oversight, cut earmarks, or regulate what they already are mandated to do, what makes you think the government can fix and run healthcare????????

This is just insane. I don't like the fact that you want us to lobby but don't allow us to say to STOP STOP STOP.

WHY WOULD ANYONE, WHO THINKS, WANT UNIVERSAL
HEALTH CARE.
1. IT LIMITS YOUR CHOICES & YOUR DOCTORS ABILITY TO TREAT YOU.
2. YOU CARE WILL DEPEND ON (HORRORS) A COMMITTEE OF GOV'T EMPLOYEES..WHO JOB IS TO LIMIT COST.
3. IF YOU ARE AN ELDER - DO NOT GET ILL OR FED'S WILL LET YOU DIE AS YOU ARE TOO EXPENSIVE.
4. PLAN BANKRUPTCED UK, CANADA & OTHER COUNTRIES THAT TRIED THIS SOCIALIST PLAN. (CITIZENS IN ENGLAND WERE TOLD "THEY HAD TO TAKE CARE OF THEMSELVES", LET PEOPLE DIE. LONG WAIT LIST IN uk & CANADA.
5. AFTER ALL THE EVIDENCE OF FAILURE, YOUR GOV'T WANTS YOU PAY MORE FOR LESS, SO "EVERYONE" ALL ALIKE ***EXCEPT** ELITES IN DC..
WAKE UP AMERICA.

I am bitterly disappointed in Consumer Union/Consumer Reports. I pay for information to be an informed independent consumer, not a member of "The Collective".
I have no desire to live in a Socialist/Communist country. You want to advocate for cheaper, better healthcare? Get the government out of it as much as possible, including Medicare. Work to allow better competition by eliminating barriers to buying insurance from out-of-state insurers. Work to ensure competition by making sure consumers can band together and get group rates easier.

Government controlled insurance has worked out so well everywhere else it's been tried, huh? Let's work to make everyone equally MISERABLE, instead of healthy.

Unless CU changes their direction, I will not renew my membership. I refuse to be part of this idiocy.

i want the same healthcare that norway has, france has, sweden has, netherland has, beligum, uk,austria..canada has
hey jeffers peterson no.1, the deficits are primarily due to our military, whether that includes independent contractors, graft buried in the budget, food concessions or out and out thievery. let us not forget the federal reserve..everytime the press heats up there goes more of our money on the interest of the paper they churn out. the value of which they set.
next up is corporate theft, let's say creative book keeping, have you seen the newest addition?..the banks have just had the laws changed, they aren't in has as bad a straights after all..the book keeping on profit verus loss has just changed, the bottom line has just transformed, their debt has mirculously disappeared due to creative book keeping. they, the banks that rigged up this mess(now which they have both the properties they lent on and whatever money the borrows could pay on a monthly bases) have billions, trillions possibly under the table, that we, you and i, have handed over to some of the wealthiest individuals on the planet.our taxes on our hard earned, as well as our grandschildren's grandchildren's hard earned money will fund and make snug the banks... our money goes to save(?) the lending institutes from disaster, cause.. well because.. ?they are too big to fail. well that's outproblem, we just aren't too big to fail..where do i sign up for too big to fail?
well rest easy, now your tax dollar does not go to your your healthcare, but rather cares for the needs of the wealthiest of the wealth vacation packages..feel better now?

I sincerely hope the (current) 38 states who are planning a lawsuit against the government will be successful in reversing this fiasco of a health bill. What makes you think the people who can't afford health care insurance now will be able to pay it when it's required by law - and then a hefty find on top of it. You'd better build lots of jails because I can't see this working, except to take away from the MAJORITY of us who don't want the stupid government running our lives!!!

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