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Obama won't delay push on healthcare

Draws praise, while budget watchers wary

Barack Obama introduced Tom Daschle as nominee for secretary of Health and Human Services while Jeanne Lambrew, who will serve as deputy director of the new White House office of Health Reform, listened at a Chicago press conference yesterday. Barack Obama introduced Tom Daschle as nominee for secretary of Health and Human Services while Jeanne Lambrew, who will serve as deputy director of the new White House office of Health Reform, listened at a Chicago press conference yesterday. (jeff haynes/Reuters)
By Lisa Wangsness
Globe Staff / December 12, 2008
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WASHINGTON - President-elect Barack Obama said yesterday his administration would press ahead quickly on national healthcare reform despite the deep recession and soaring federal budget deficit.

The promise of immediate action drew praise from a growing number of health policy interest groups that are clamoring for immediate action on health reform, but some budget watchers raised concerns about the long-term financial consequences.

Obama said that with American businesses burdened by health costs that hurt their ability to compete globally, and millions of uninsured people unable to afford care, sweeping national health reform has become more urgent.

"Now, some may ask how at this moment of economic challenge we can afford to invest in re forming our healthcare system," he told reporters at a news conference in Chicago. "And I ask a different question: I ask, how can we afford not to?

"Right now," he said, "small businesses across America are laying off or shutting their doors for good because of rising healthcare costs. Some of the largest corporations in America, including major American carmakers, are struggling to compete with foreign companies unburdened by these costs."

Obama's vow to push hard and fast for health reform is further evidence that he sees the recession as an important opportunity: Rather than scale back his agenda, he is using the crisis as a vehicle for accomplishing it. Obama has said he wants the economic stimulus package to include major investments in jobs in clean and renewable energy industries, one of the main objectives of his energy plan. He has also pledged new aid to state and local governments for infrastructure projects to improve such things as public transportation and schools.

To carry out his health reform plans, Obama yesterday named Tom Daschle, the former Senate majority leader from South Dakota, as his choice for secretary of Health and Human Services and as director of a new White House Office of Health Care Reform. He said Daschle, who has written a book ("Critical") on how to tackle the issue, has the necessary expertise and experience in dealing with Congress, as well as an ideal temperament for achieving compromise.

"He is the original no-drama guy, known for speaking softly but leading boldly," Obama said.

Daschle, a respected 26-year House and Senate veteran, drew praise from healthcare interests yesterday. Senator Olympia J. Snowe, Republican of Maine, said that by giving Daschle the policymaking portfolio in addition to Health and Human Services, Obama is "putting a laser-like focus on it to get it done."

But some raised concerns about his work after his defeat in 2004 as a policy adviser to Alston and Bird, a powerful Washington, D.C., lobbying firm with specialities including healthcare. Daschle was not a lobbyist, but the details of his work there have not been explained by the Obama team.

As a candidate, Obama promised not to have lobbyists in his administration; his transition team has said administration officials cannot work on any issues they lobbied on within the previous two years.

David Arkush of Public Citizen, a nonpartisan, Washington-based watchdog group, said it is not clear how many conflicts of interest Daschle might have and that Daschle might have to recuse himself from some decisions.

The economic crisis has also created a sense of urgency that could help push bold but politically challenging initiatives like health reform.

"They understand that in order to win something as complex as healthcare reform you have to move quickly and aggressively, because the longer it's out there, the harder it becomes to do," said Richard Kirsch, of the left-leaning advocacy group Health Care for America Now.

Some budget watchdog groups expressed concern about the timing of a major health reform initiative, given that the annual deficit could exceed $1 trillion this fiscal year. Robert Bixby, executive director of the nonpartisan Concord Coalition in Arlington, Va., said he believes health reform would eventually be a wise investment, but not right now, when government should focus on more direct economic stimulus efforts.

"Our budget policy is already on an unsustainable path with the growth of the healthcare promises we already have in place for retiring boomers," he said. "I'm saying, let's treat the emergency and think about the investments we want to make when we get the economy back on track and when the budget is in better shape to deal with them."

Robert Reischauer, a former director of the Congressional Budget Office who is now president of the Urban Institute, said that by the time healthcare reform is actually implemented in a few years, the nation should be out of the worst of the recession. But he said excessive spending now could become a problem later on, when interest rates rise and it costs more to borrow money to pay for Obama's agenda items.

But a growing chorus of voices is calling for Obama to take on health reform now, including powerful business lobbies such as the Business Roundtable and the National Federation of Independent Business, as well as insurers and healthcare providers. Amanda Austin, a senior manager for legislative affairs for the small business lobby, said her members agree on the need to act now.

"Most small employers operate on a thin margin, and in these tough economic times, offering healthcare for employees as well as maintaining it for themselves" is growing extremely difficult, she said.

And, as many economists and politicians have noted of late, the $100 billion to $150 billion that a reform plan would cost annually seems manageable in light of the $700 billion bailout package Congress passed this fall to shore up the nation's financial institutions.

"The main impediment to health reform I think has to some extent been attenuated by being submerged in this ocean . . . this attempt to revive this economy," said Mark Pauly, a healthcare economist at the University of Pennsylvania's Wharton School, who called the $80 billion-a-year cost of a no-frills plan a "rounding error" at this point. "We might as well make a virtue out of misery."

A number of reform advocates also say investing in things like health information technology would not only improve care and over time lower healthcare costs, but also stimulate the economy in the short term.

"After all, somebody would need to develop the computer systems and operate them for thousands of American healthcare providers," the health economist Jonathan Gruber of the Massachusetts Institute of Technology wrote in a New York Times opinion piece last week.

Daschle, who has already spoken with Congressional leaders on health reform, said he would attend several meetings being held by Obama's campaign supporters across the country over the next few weeks to hear their ideas about how the nation's healthcare system could be fixed. The Obama transition team is also collecting comments on healthcare issues through its website, Change.gov. Both the local discussions and the website, Daschle said, are efforts to "make healthcare reform an open and inclusive process that goes from the grass roots up," in the spirit of Obama's presidential campaign.

Sasha Issenberg of the Globe staff contributed to this report.

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