Healthcare: Obama presses ahead

Its reform is integral to reviving the economy, he signals, with his pick of Daschle as point man.

By , Staff writer

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    Thomas Daschle: President-elect Obama has tapped the former senator as Health and Human Services secretary. Mr. Daschle has already reached out to healthcare players and organized community discussions.
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President-elect Obama’s announcement that Thomas Daschle will be his point man on healthcare reform signals that the issue remains at the top of the agenda, despite the economic meltdown and the mounting deficit.

Throughout the campaign, candidate Obama repeatedly called reform of the US healthcare system a high priority. As the economy began to unravel, however, the steep cost of reform – estimated at between $50 billion and $65 billion a year – prompted many pundits and policymakers to predict that it would have to be put on a back burner.

But in designating the former South Dakota senator to head the Health and Human Services Department, as well as the overall effort to reform healthcare, Mr. Obama made it clear he sees the reform as integral to his efforts to resuscitate the economy.

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“The news is that healthcare is still on the agenda, and nobody really expected it to be,” says Drew Altman, president of the Kaiser Family Foundation, a leading healthcare-research nonprofit organization, whose headquarters are in Menlo Park, Calif. “It has been redefined really from a healthcare issue [alone] to a piece of the larger economic issue.”

Mr. Daschle has spent the past few weeks reaching out to major healthcare players, organizing nationwide community discussions on reforms, and working with leaders in Congress. They’ve signaled they’d like to have a healthcare bill ready for debate as early as January.

“The time is now to solve this problem. I met too many families during the course of the campaign before the economic downturn that are desperate,” Obama said Thursday. “This has to be intimately woven into our overall economic recovery plan: It’s not something that we can put off because we’re in an emergency. This is part of the emergency, and we have to make sure our strategy reflects that.”

The announcement about Daschle was not unexpected. Many in the healthcare community have praised his extensive understanding of the sector’s complexities, as well as his political expertise. But some conservatives have criticized the appointment, saying it signals that the next administration favors too much government involvement in the healthcare industry.

That ideological split – between those who believe the government has a role in healthcare regulation and those who favor free-market reforms – has stymied significant progress on reform during the past eight years. During that time, however, a consensus has also emerged among political and healthcare-industry leaders, as well as in the business community, that something must be done about the estimated 47 million uninsured Americans. Their number has ticked steadily upward as health costs have also continued to spiral upward.

For years, the high cost of covering the uninsured, which could exceed $100 billion annually by some estimates, kept Congress from acting. But now, as the increasing unemployment rate adds still more to the ranks of the uninsured, a new sense of urgency is rising.

“There’s a strong consensus emerging that the cost of not acting now exceeds the cost of bringing everyone into the system,” says Phil Blando, a healthcare consultant in Washington. “That’s the sense I get from my clients who represent insurers, large employers, and drug-benefit managers.”

In 1993, the last time Congress attempted a major overhaul of the healthcare system, reform had broad public support. But it failed due to a combination of factors, from the way the Clinton administration designed its program in secret and didn’t bring the major stakeholders into the process to a major advertising campaign by the insurance industry, which opposed the Clinton package. Since then, America’s healthcare system has continued to deteriorate.

This time around, most of the major stakeholders – even old opponents in the debate – have been working together for several years to find consensus on how to cover the uninsured.

“The last time healthcare reform was an issue, we spent our time reacting to others’ proposals. This time, our industry is taking a drastically different approach,” says Robert Zirkelbach, spokesman for America’s Health Insurance Plans, which represents US healthcare insurers. “Our board of directors believes we have a responsibility, as an integral part of the delivery system, to offer constructive proposals to help advance reform.”

There’s no shortage of such goodwill on all sides. But the real debate will begin when the details of various reform proposals are put on the table, particularly how to pay for them and how to rein in costs.

“Healthcare is very, very complicated, and it’s extremely difficult to make broad, deep changes, and so I don’t think we should rush to get it completed, says Dr. Irwin Redlener, a leading healthcare expert. “But we should view it as a very urgent and high priority because the healthcare challenges, economically and otherwise, are so pervasive that we can’t definitely fix the economy without also addressing it.”

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