Healthcare at a Crossroads – The Problem

The growing cost of healthcare was a national problem back in 1992 when Hillary Clinton failed to come up with a workable solution. It’s an even bigger problem today, costing us 18 percent of the national GDP – a figure that’s expected to nearly double over the next 30 years, according to a report released this week by the president’s Council of Economic Advisers. That means more and more of our paycheck – and a greater share of our tax dollar – will go for healthcare.

President Obama made healthcare reform a centerpiece of his campaign. And he’s told Congress it has to get it done this year or else. Although the president is spotlighting any vague promise of future savings as proof that his campaign speeches were more than rhetoric, a lot of Beltway insiders are admitting that the likelihood we’ll see any true reform is getting slimmer and slimmer.

The president can’t blame this one on the Republicans not playing nicely with the Democrats. The truth is that the Democrats aren’t playing nicely with each other. Some congressional Democrats are holding out for all or nothing – meaning they will settle for nothing but a universal, socialized coverage plan. Others insist on a more moderate approach.

Meanwhile, the president and his economic advisers are touting as real progress a broad promise extracted at a closed “summit” last month from a coalition of healthcare providers and pharmaceutical and medical device industry groups. After the afternoon summit, the president proudly announced, without giving any details, that the coalition had promised to slow the growth of healthcare costs by 1.5 percentage points a year over the next decade for a total savings of $2 trillion.

If that savings were to occur, the typical family of four would have $2,600 more in its pocket in 2020, according to the council’s report.

But since that summit, the members of the coalition have had a chance to crunch some numbers. They released a joint letter this week listing some general steps they could take to slow the growth of healthcare costs. (Note that we aren’t talking about actually cutting costs.) And in that letter, they say they might be able to save as little as half of the $2 trillion Obama is counting on.

Yes, we need healthcare reform. But if we want true reform, we’re going to have to come up with the solution ourselves – and then sell it to Congress and the various stakeholders.

I’ll start the ball rolling tomorrow night with some ideas that could realistically – and almost painlessly – change healthcare as we know it.