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Obama’s health care goal faces big obstacles
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Fighting the skeptics
This month, Mr. Obama’s health advisers tried to recast the debate so that the questioning of any one number would not undermine the plan’s broader credibility. They enlisted eight health policy experts to sign a letter that, without endorsing the math behind any single initiative, proclaimed it was “not only possible, but likely” that Mr. Obama could save $200 billion annually. They did not say by when.
Mr. Cutler, who helped collect the signatures, said he and his colleagues had decided “that our attempt to lay out one plausible scenario for the savings had created more problems than it had solved.” He added: “Putting the debate where this message puts it — do you believe we can save 8 percent of health spending through a major series of public and private reforms — asks the question in a way that is much more productive than the issue of ‘Do you believe a single estimate among many, many studies?’ ”
Mr. Obama’s economic policy director, Jason Furman, said the campaign’s estimates were conservative and asserted that much of the savings would come quickly. “We think we could get to $2,500 in savings by the end of the first term, or be very close to it,” Mr. Furman said.
Other gains
The campaign won additional backing this week from Kenneth E. Thorpe of Emory University, an authority on health care costs who helped formulate Bill Clinton’s failed plan in 1993. In an assessment that he initiated in coordination with the campaign, Mr. Thorpe wrote that if all of Mr. Obama’s proposals were enacted they would reduce health spending by between $203 billion and $273 billion by 2012. He calculated that half of the savings would accrue to the federal government.
The Obama advisers said that while not all of the savings would translate into lower premiums, consumers would gain in other ways. The savings to employers would be passed along as higher wages, they predicted, and the savings to government would eventually mean either lower taxes or added benefits.
‘There is no easy money’
But whether employers and governments respond that way cannot be guaranteed, particularly in a difficult economy. And a number of health policy experts have questioned whether the $2,500 projection is either fiscally or politically realistic. Reducing health care costs, they emphasized, means taking money from someone’s pocket and rationing care that Americans have come to expect, a recipe for stiff resistance.
“There is no easy money because, as the saying goes, one person’s fraud and abuse is another person’s income,” said Joseph R. Antos of the American Enterprise Institute. “I wouldn’t think that four years or eight years or probably 10 years will be enough to see numbers of that sort.”
The Commonwealth Fund, a health research group in New York, published a study in December projecting that a robust overhaul consisting of 15 broad initiatives would generate savings of only 6 percent after 10 years. “Doing it by the end of a first term is ambitious and would require tough policies,” said Karen Davis, the group’s president.
Jonathan B. Oberlander, who teaches health policy at the University of North Carolina at Chapel Hill, called it wishful thinking. “Do they have the potential to generate significant savings in the long run?” Dr. Oberlander asked. “Yes. Do I believe they will produce substantial savings in the short run that can be used to finance Obama’s plan? No.”
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