The Final State of the Union
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The President held a forum at the White House yesterday, where he discussed the pressing need for health care reform, and fielded questions and concerns from some of the 164 audience members. The audience represented a diverse array of health care stakeholders – including doctors, nurses, insurance company executives, small business owners, as well as patients from across the country. If you weren’t able to watch it last night, you can go to ABC’s website to watch "Prescription for America" in its entirety.
The President tackled a variety of questions, talking at length about costs, choice, and effective treatment. Health care reform is a complex problem – people have been talking about it since Harry Truman – with no simple solution. The President called for a "uniquely American" solution that will allow us to control costs and provide quality care while preserving choice. The President emphasized that this reform is needed now because the status quo is unacceptable, and a show of hands from the audience showed unanimous agreement with him:
Understand that the status quo is untenable, which is why you saw, even though we've got Republicans, Democrats, independents, people from all parts of the health care sector represented here, everybody understands we can't keep doing what we're doing. It is bankrupting families. I get letters every single day from people who've worked hard and don't have health insurance. It is bankrupting businesses who are frustrated that they can't provide the same kind of insurance that they used to provide to their employees. And it's bankrupting our government at the state and federal levels
Nobody disputes that costs are unsustainable, and the President explained they will only continue to rise without reform:
The average family has seen their premiums double in the last nine years. Costs for families are going up three times faster than wages. So if you're happy with your health care right now – and many people are happy with their health care right now – the problem is, 10 years from now, you're not going to be happy because it's going to cost twice as much or three times as much as it does right now. Out-of-pocket expenses have gone up 62 percent. Businesses increasingly are having to cut back on health care or – if you talk to ordinary workers, they're seeing this all the time – employers even if they don't want to are having to pass on costs to others.
So unfortunately whatever it is that we're doing right now isn't working, Diane. What we see is great examples of outstanding care, businesses that are working with their employees on prevention, but it's not spreading through the system. And unfortunately government, whether you like it or not, is going to already be involved. We pay for Medicare, we pay for Medicaid. There are a whole host of rules, both at the state and federal level, governing how health care is administered.
And so the key is for us to try to figure out how do we take that involvement not to completely replace what we have but to build on what works and stop doing what doesn't work. And I think that we can do that through a serious health care reform initiative.
The President underscored the need to identify best practices – he used the Mayo Clinic as an example. The Mayo Clinic has top quality care and is one-third less expensive than average, while some of the most expensive places have worse health outcomes. By duplicating these best practices across the system, we can achieve the best possible care while controlling costs. The President explained that driving down costs is essential to being able to expand coverage:
Now, what I've said is that if we are smart, we should be able to design a system in which people still have choices of doctors and choices of plans that make sure that the necessary treatment is provided, but we don't have a huge amount of waste in the system, that we are providing adequate coverage for all people, and that we are driving down costs over the long term.
If we don't drive down costs then we're not going to be able to achieve all those other things. And I think that on the issue that's already been raised by the two doctors, the issue of evidence-based care, I have great confidence that doctors are going to always want to do the right thing for their patients if they've got good information and if their payment incentives are not such that it actually costs them money to provide the appropriate care.
And right now what we have is a situation because doctors are paid fee-for-service and there are all sorts of rules governing how they operate; as a consequence oftentimes it is harder for them, more expensive for them to do what is appropriate. And we should change those incentive structures.
The President pointed out that a reform plan must also work with insurance companies to modify policies and curb costs:
So if you're happy with your plan, as I said, you keep it. Now, there are some restrictions we want to place on insurers. Pre-existing conditions is a tool that has prevented a lot of people from either not being able to get insurance or, if they lose their job, they can't find insurance. We think those policies should end. So there are going to be some areas where we want to regulate the insurers a little more.
Now, in exchange, they're going to have a bigger customer pool. And so we think that they may not make as much profit on every single person that they provide coverage to. On the other hand, overall, I think they can still be profitable.
In terms of cost, understand that the system is already out of whack in terms of costs as it is. So if we do nothing, costs are going to keep on going up 6, 7, 8 percent per year, and government, businesses, and families are all going to find themselves either losing their health care or paying a lot more out of pocket. That's going to happen if we do nothing.
What I've said is, let's change the system so that our overall cost curve starts going down by investing in a range of things – prevention, health IT, et cetera. We will have some upfront costs and the estimates, as Charlie said, have been anywhere from a trillion to $2 trillion. But what we've said is, what my administration has said, what I've said, is that whatever it is that we do, we pay for. So it doesn't add to our deficit.
He again emphasized how a public option can work while maintaining, and improving, a competitive private insurance market:
But what we've said is that we can set up a public option in which they're collecting premiums just like any private insurer, that doctors are reimbursed at a fair rate, but because administrative costs are lower, we are able to keep private insurers honest in terms of the growth of costs of premiums and deductibles and so forth.
Now, you'll always hear folks say that the free market can do it better; government can't run anything. And what I say is, well, if that's the case, nobody is going to choose the public option. So the private insurers, who I think are very confident that they're providing a good service and a good product to their customers, should feel confident that they can compete with just one other option.
A lot of the objection to the public option idea is not practical, it's ideological. People don't like the idea of government being involved. But keep in mind that the two areas where government is involved – are involved in health care – Medicare and the VA – actually, there's pretty high satisfaction among the people who participate.
For the President, there is no issue for which change is more urgent and necessary, and despite decades of frustrated attempts at reform, the President made clear he believes the time is now:
But the one thing I'm absolutely confident about is that whenever this country has met a significant challenge to our long-term well-being, that we ultimately rise up and meet it. And this is one of those moments where the stars are aligned. We've got insurers who are interested, doctors who are interested, nurses, patients, AARP is here and they've seen some of the potential benefits, we're actually going to be filling the "doughnut hole," drug companies have said that they'd be willing to reduce the costs for seniors for prescription drugs as part of health care reform.
But we have to have the courage and the willingness to cooperate and compromise in order to make this happen. And if we do, it's not going to be a completely smooth ride, there are going to be times over the next couple months where we think health care is dead, it's not going to happen. But if we keep our eye on the prize, and we recognize that America has always been up to these big challenges, and we can't afford not to act, then I'm absolutely convinced that we can get it done this time.
