The Obama budget and health care reform

As has been widely reported, the Obama administration’s newly unveiled budget creates a $634 billion fund over the next ten years to promote affordable access to health care and control the cost of skyrocketing prescription drug prices. The budget does not create or promote a model for health care reform, however. Administration officials have hinted that they would like to leave those details to Congress and the legislative process.

In a teleconference with reporters, Deputy Director of the White House Office of Management and Budget (OMB) Rob Nabors said that the administration plans to work with Congress on the details of the budget’s proposed health care reforms. ‘I see this process being a very collaborative effort with Congress,’ he said. ‘It’s the beginning of a conversation with Congress.’

‘What we’re talking about is a significant down payment on the single biggest issue that affects the fiscal future of this country,’ Nabors said. This fund will not cover the whole cost of health care reforms, he added, but it is ‘a significant start.’

According to the , the savings created by curbing Medicare overpayments ($176 billion) created under the Bush Medicare privatization plan, eliminating the Bush tax cuts for the wealthiest Americans and corporate tax loopholes ($300-$400 billion) will be shifted to the health care fund. More money will be found by capping Social Security benefits for the wealthy ($8 billion) and by eliminating tax breaks for major oil companies ($50 billion) implemented by the Bush administration.

According to the Alliance for Retired Americans (ARA), privatized Medicare Advantage plans, which the Obama budget targets for streamlining, cost between 12 percent and 19 percent more than traditional Medicare for the same services, draining the Medicare Trust Fund and hiking out-of-pocket expenses for retirees.

“The President declared unambiguously today that Medicare’s top priority should be the health of our nation’s seniors, not the big drug and insurance companies. This is a refreshing change for our country,” ARA President Barbara Easterling said in a press statement.

AFL-CIO President John Sweeney added, ‘It is a real health care reform approach with real money to start things rolling.’

A statement released by the Center for American Progress welcomed the announcement of the health care fund, but added, ‘The budget must be followed by comprehensive reform legislation that, in addition to making affordable care available to all, will help reorient the health care system so it offers quality care geared towards prevention and wellness, not just treating us when we are sick.’