Healthcare & Pharmaceuticals

U.S. Healthcare Overhaul Proposals and Goals

The U.S. spends more than $2 trillion every year on healthcare. However, healthcare costs continue to grapple with higher healthcare premiums, lower benefits, and an increasing number of uninsured patients.

According to President Obama, healthcare reform is the single most important factor for the long-term fiscal health of the nation. President Obama has introduced the healthcare reform plan, which is a comprehensive healthcare plan that works on the principle of “fix what’s broken and build on what works.”

Key issues in U.S. Healthcare System at Present

• Unlike other developed countries, the U.S. does not have universal healthcare coverage
• Healthcare costs for individuals are rising dramatically
• Most Americans obtain coverage through their employers, most of which share the cost of premiums, a portion of the cost of prescriptions, and medical care
• Premiums for employer-provided programs have risen higher than wages
• Others buy insurance in the individual market, which is expensive
• Nearly 46 million Americans have no insurance, and 25 million more are underinsured. One major reason for this crisis is that many employers have stopped offering insurance to employees because of the high cost.
• There are tremendous variations in Medicare spending per enrollee across the states.

Goals of US Healthcare Overhaul

• To expand health insurance coverage to the 46 million uninsured and 25 million underinsured Americans.
• To curb rapidly rising insurance costs.
• U.S. healthcare now consumes $2.2 trillion a year, approximately $7,471 per person. This equals 16 percent of the Gross Domestic Product with a projected rise to 25% of the GDP by 2025.

Proposed Reforms (Key Points)

• All individuals would be required to obtain insurance, including children
• Create the National Health Insurance Exchange (NHIE) and public insurance program
• Reinsurance pool for catastrophic costs
• Mandate that all employers provide coverage except for startups and very small businesses
• Income-based subsidy for health premiums on coverage purchased in NHIE or new public program
• Allocation of $10 billion on an annual basis to health information technology for five years
• Create penalty for employers that do not provide coverage and parents who do not obtain coverage for children
• Other areas with respect to regulations, quality improvements, wellness programs and malpractice etc.

Amid the economic crisis and the war on terror, President Obama has pledged to take on the boldest challenge in healthcare today – universal healthcare coverage. His reform includes cost reduction, health information technology, transparency, and public health programs. However, an assurance of universal access is central to his proposals.

"The questions of who gets what, these difficult choices … really are not posed in the current health reform legislation. The challenge is us, the American people: We want the latest and the best, and we want it now,” said Drew E. Altman, President of the Kaiser Family Foundation.

(Source: The Washington Post, July 8, 2009)