June 16, 2009— -- In the longest speech of his presidency, President Obama outlined his vision for a health care plan at a gathering of the country's leading doctors group, the American Medical Association.
But the question that lingers is what health care reform being proposed by the administration means for consumers, and what hurdles it will face from the health industry.
One uncertainty is what changes, if any, will be made to malpractice awards, which could determine how many tests and referrals doctors prescribe and impact the ability of a patient to sue if something goes wrong.
Doctors say costs are spiraling up because they conduct so many unnecessary tests due to fear of malpractice lawsuits.
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"What we asked the president is that if we as physicians are willing to tackle the issue of looking at variation of care and reducing unnecessary tests, we also have to have protection in the courtroom. If we didn't order a test, that we subsequently aren't going to get sued because we didn't order that test that shouldn't have been done in the first place," AMA's incoming president James Rohack told ABC News in May.
The president was hesitant to make any promises to doctors Monday, only telling them that he would not do what they recommend when it comes to medical malpractice reform, and limiting the size of the awards juries give.
"I recognize that it will be hard to make some of these changes if doctors feel like they're constantly looking over their shoulders for fear of lawsuits. ... I understand some doctors may feel the need to order more tests and treatments to avoid being legally vulnerable. That's a real issue," Obama said.
But, to a chorus of boos, the president added, "I'm not advocating caps on malpractice awards, which I personally believe can be unfair to people who've been wrongfully harmed."
Obama said he wants to work with doctors to encourage "broader use of evidence-based guidelines" and cut back "excessive defensive medicine," but he did not provide details on how that would be done.
How to Tackle Health Care Costs
The second hurdle facing the industry and the administration is cost.
"Making health care affordable for all Americans will cost somewhere on the order of $1 trillion over the next 10 years. That's real money, even in Washington," the president said. "Failing to reform our health care system in a way that genuinely reduces cost growth will cost us trillions of dollars more in lost economic growth and lower wages."
But the question remains as to who will pay for that reform.
The president said the administration will cover costs by the $635 billion Health Reserve Fund in the budget, spending cuts and eliminating inefficiencies in Medicare. But he also said this could be paid for by increasing taxes on those who make more than $200,000 annually.
Sen. Max Baucus, D-Mont., the chair of the Senate Finance Committee, will introduce his health care reform bill this week and it's expected to include a provision to tax health insurance benefits for the first time, a provision then-Sen. Obama attacked when proposed by Sen. John McCain, R-Ariz., during last year's election.
Health and Human Services Secretary Kathleen Sebelius told ABC News that Obama opposes the Baucus proposal.
"The president continues to feel that taxing employer-based benefits may actually help to dismantle the current system, which ensures about 180 million Americans and provides the basis for our private health insurance plan. ... Having that benefit taxed may be a step backward and not a step forward," she said. "So he continues to propose alternative methods of financing."
A Congressional Budget Office report Monday estimated that the Senate Health Committee's plan, offered by Sens. Ted Kennedy, D-Mass., and Chris Dodd, D-Conn.,would cost $1 trillion over 10 years, and while a net increase of 16 million of uninsured Americans would get health insurance, tens of millions others would be left behind. Millions more would lose their employer-provided health insurance if employers opt to sign up for a competing public plan that Obama is proposing as a way to keep insurance companies "honest."
That proposal directly contradicts the president's statement yesterday.
"No matter how we reform health care, we will keep this promise to the American people: If you like your doctor, you will be able to keep your doctor, period. If you like your health care plan, you'll be able to keep your health care plan, period," the president promised.
White House officials said today the administration still needs to weed out the details with senators.
"This is not the administration's bill, and it's not even the final Senate committee bill," White House press secretary Robert Gibbs said in response to the Congressional Budget Office report. "What is clear is what will happen if we let political posturing stand in the way of reform again: exploding deficits, job loss, dwindling benefits, and millions more Americans joining the ranks of the uninsured."
Government's Public Option Plan
A third issue, and the one where the president is likely to face the most resistance from the insurance industry, is a proposal for a public health care option, in which patients would have the right to choose a government-run plan that would compete with private plans.
Obama addressed criticism of the plan, saying it would not bring about government-run health care but only provide another insurance option to Americans, especially those that may not be able to afford a private plan.
"You will have your choice of a number of plans that offer a few different packages, but every plan would offer an affordable, basic package. And one of these options needs to be a public option that will give people a broader range of choices and inject competition into the health care market that [will] force waste out of the system and keep the insurance companies honest," he said.
Critics of the public plan say many employers will drop private insurance coverage, opting for the cheaper government plan.
Outgoing AMA president Nancy Nielson has said the AMA "opposes any public plan that forces physicians to participate, expands the fiscally-challenged Medicare program or pays Medicare rates, but the AMA is willing to consider other variations. ... This includes a federally chartered co-op health plan or a level playing field option for all plans."
The president's latest pitch given to a group of skeptical doctors was mainly to urge the industry to act on reform, and cut costs.
"I need your help, doctors, because to most Americans, you are the health care system," the president said. "We listen to you, we trust you. And that's why I will listen to you and work with you to pursue reform that works for you."
The president's proponents are also taking the message directly to consumers, with a new TV ad by "Americans United for Change" supporting health care reform.