Obama Offers Health Care Details

WASHINGTON (AP) - President Barack Obama, providing the first
real details on how he wants to reshape the nation's health care
system, urged Congress on Wednesday toward a sweeping overhaul that would allow Americans to buy into a government insurance plan.

In a letter to two senators leading the health care debate,
Obama also moved toward accepting a requirement for every American
to buy health insurance, as long as the plan provides a "hardship
waiver" to exempt poor people from having to pay.

Obama opposed such an individual mandate during his campaign,
but Congress increasingly is moving to embrace the idea.

Obama set out the goals in a letter to Sens. Edward Kennedy,
D-Mass., and Max Baucus, D-Mont., chairmen of the two committees
writing health care bills. It followed a meeting he held Tuesday
with members of their committees, and amounted to a road map to
keep Congress aligned with his goals.

"The plans you are discussing embody my core belief that
Americans should have better choices for health insurance, building
on the principle that if they like the coverage they have now, they
can keep it, while seeing their costs lowered as our reforms take
hold," Obama wrote.

Obama has asked the House and Senate each to finish legislation
by early August, so that the two chambers can combine their bills
in time for him to sign a single, sweeping measure in October. In a
statement Baucus welcomed the assignment.

"I will stop at nothing to deliver a health reform bill that
works for families and businesses to the president this year,"
Baucus said.

Covering 50 million uninsured Americans could cost as much as
$1.5 trillion over a decade, and cost is emerging as a major
sticking point. Obama didn't offer new solutions to that problem in
his letter Wednesday but did say he'd like to squeeze an additional
$200 billion to $300 billion over 10 years from the Medicare and
Medicaid government insurance programs for the elderly, disabled
and poor.

He said he'd do it through such measures as better managing
chronic diseases and avoiding unnecessary tests and hospital
readmissions. Savings from such measures are uncertain.

Medicare benefits cost the federal government about $450 billion
a year and Medicaid about $200 billion. Obama already has targeted
the programs for some $300 billion in cuts over 10 years in the
2010 budget he released in February.

He also said he's open to congressional proposals to let an
independent commission identify cuts to Medicare which would take
effect unless Congress rejected them all at once, similar to how
military base closures are handled.

The president said he supports a new health insurance exchange
that Congress is crafting, a sort of marketplace that would allow
Americans to shop for different plans and compare prices.

All of the plans should offer a basic affordable package, and
none should be allowed to deny coverage to people with pre-existing
conditions, Obama said - big changes from how private insurance
companies operate today.

"I strongly believe that Americans should have the choice of a
public health insurance option operating alongside private plans,"
Obama wrote, weighing in firmly on one of the most controversial
issues in the debate. "This will give them a better range of
choices, make the health care market more competitive and keep
insurance companies honest."

Republicans strongly oppose a public plan, as do private
insurers, who contend it would drive them out of business.

"A government-run plan would set artificially-low prices that
private insurers would have no way of competing with," Senate
Minority Leader Mitch McConnell said Wednesday on the Senate floor.

The idea of what Obama called a "hardship waiver" for
individual Americans too poor to buy care splits the difference
between where he was during the presidential campaign and where
Congress appears to be heading.

In the campaign, Obama did not support requiring everyone to buy
insurance, putting him at odds with then Democratic rival Hillary
Rodham Clinton. Congress is looking at doing so. The hardship
waiver idea is under consideration by the Senate Finance Committee,
which also is considering giving tax credits to certain individuals
so they can afford health care. Kennedy and House Democrats are
looking at giving subsidies to the poor to help them buy coverage.

The letter didn't address the issue of taxing health care
benefits. Obama opposed that during his campaign but Congress is
now considering it, and Obama hasn't shut the door on it.

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