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StarBulletin.com

Health care reform shows promise


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POSTED: Wednesday, May 13, 2009

President Barack Obama has reason to be encouraged by the promise of leading health care providers to reduce the growth of national health spending, but the question of whether they will support comprehensive health care reform will be known only when the specifics emerge from Congress in the next few weeks. What the president called an “;unprecedented commitment”; could be reduced to a partisan battle that should not be allowed to shelve needed reform.

The health care providers promised to reduce costs, which had been forecast to grow by 6.2 percent a year in the next 10 years, by 1.5 percent a year. White House officials said the plan could save $2,500 a year in health expenses for a family of four in the fifth year and a total of $2 trillion nationally over the decade. If followed, it could make comprehensive health insurance coverage less expensive.

The “;voluntary effort”; by the health industry to control costs after President Jimmy Carter proposed price controls in 1977 was short-lived. Health spending also slowed when President Bill Clinton proposed comprehensive reform in 1993 and 1994 but surged a few years later.

Insurance executives have invited Congress to impose strict federal regulation of their industry. They already have agreed to end certain practices such as refusing to cover individuals with pre-existing conditions or charging women higher rates than men.

The core of the reform proposed by Obama in last year's campaign would be expansion of employer-based health insurance, pioneered in Hawaii 35 years ago and followed in many other states. Obama said he would require most companies to offer their employees health insurance or pay a payroll tax of 7 percent into a pool to finance government-sponsored insurance.

Sen. Charles Schumer, D-N.Y., a member of the Senate Finance Committee, said the industry's cost-cutting pledge was “;a good-faith gesture”; but “;does not mitigate the need for a public plan option in our health-care reform bill.”;

Senate Republican leaders have said a government-run program “;would create an unlevel playing field and inevitably doom true competition,”; resulting in an entirely government-run program similar to health care in Canada or England. Insurance companies also oppose such a program, fearing the competition would drive them out of business. Sponsors of the legislation need to include provisions that would prevent such an outcome widely unpopular among Americans.

While differences exist, Obama and the industry agree that reforms are needed. Absent is the hostility during the Clinton administration, when the same industry leaders that met with Obama this week financed successful television advertisements featuring a fictional Harry and Louise, who blasted away at health care reform over the kitchen table. Harry and Louise should be prevented from making an encore.