11 Observations on Obama's Health Care Speech

June 15, 2009— -- I believe President Obama's speech to the American Medical Association Monday was the most comprehensive statement about reform he has ever made publicly. And given the setting, some might say it was also one of his more courageous statements.

I offer the following summary -- with a few passing questions/comments thrown in:

1) He kept hammering at the fiscal disaster that awaits us if we do nothing. And I think this is the first time he used General Motors as an example: "If we do not fix our health care system, America may go the way of GM; paying more, getting less, and going broke."

2) He also kept speaking to the fear of change and was particularly harsh on the special interest groups that use fear tactics "to paint any effort to achieve reform as an attempt to socialize medicine."

3) So he also kept speaking about keeping what you have if you like it. "If you like your health care plan, you will be able to keep your health care plan. Period. No one will take it away. No matter what."

Comment: What's the "reform" about simply allowing you to keep your present plan as is?

4) Next he commented on two reforms that almost everyone agrees are necessary: electronic medical records and prevention.

Comment: At this point, he ignored the fact that there is no evidence that prevention long term saves money -- e.g., we may get so good at it that everyone lives to 90 and gets Alzheimer's.

5) Then he got to two much more sensitive -- for his AMA audience -- reform issues:

The first "is a system of incentives where the more tests and services are provided, the more money we pay... It is a model that rewards the quantity of health care rather than the quality of care... It is a model that has taken the pursuit of medicine from a profession -- a calling -- to a business.

(At this point, dead silence from the audience -- but thunderous applause erupted at the end of the next paragraph.)

"That is not why you became doctors... You did not enter this profession to be bean-counters and paper-pushers. You entered this profession to be healers -- and that's what our health care system should let you be." He then talked about improving the incentives for primary care.

The second issue, in this section, was improving information flow to doctors about what works.

"So one thing we need to do is figure out what works, and encourage rapid implementation of what works into your practices... Let me be clear: identifying what works is not about dictating what kind of care should be provided. It's about providing patients and doctors with the information they need to make the best medical decisions."

(Applause throughout this section -- and an example of where Obama very cannily spoke to physician fears about reform.)

6) He then told the doctors he will listen to them and will "pursue reform that works for you." (Applause) But when he next went to malpractice reform, he at first got major applause when he talked about their "fear of lawsuits" but some booing (the only time I think) when he said he does not support caps on malpractice awards.

7) He mentioned (as he did in his letter last week to the Senate committees) "explanding the role of a commission created by a Republican Congress called the Medicare Payment Advisory Commission..." which sounds to me very much like the "Federal Health Board" proposed by Tom Daschle.

8) He then turned to the 46 million uninsured and got major applause when he said, "We are a people who look out for one another. That is what makes this the United States of America."

He made a big pitch for a "Health Insurance Exchange" which will be like the program for federal employees where they can choose from a list of insurance plans approved by the government -- and immediately said that "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."

Comment: This is the big sticking point with Republicans and something the AMA said last week they were opposed to. However, the AMA has tried to back away from that stance a little bit and today there was moderate applause for this idea. He also threw another bone to this audience by saying the annual process for setting payments for doctors -- the Sustainable Growth Rate -- needs to be reformed.

9) But he got his biggest applause for the following paragraph: "Insurance companies have expressed support for the idea of covering the uninsured, and I welcome their willingness to engage constructively in the reform debate. But what I refuse to do is simply create a system where insurance companies have more customers on Uncle Sam's dime, but still fail to meet their responsiblities. That is why we need to end the practice of denying coverage on the basis of preexisting conduitions. The days of cherry-picking who to cover and who to deny -- those days are over."

Comment: The thunderous applause here underlined that physicians and insurance companies are mostly adversaries. So doctors like the idea of insurance reforms as long as it doesn't affect their income -- i.e., better to take from insurance companies than from us.

Obama then re-told the story of his mother fighting for insurance coverage for her cancer treatment.

10) Most of the rest of the speech detailed how he proposes to save nearly $1 trillion to pay for his reform ideas.

Comment: This was a long and complicated section that will be hotly debated by congress and policy experts. He did say that this savings would be independent of estimates by the CBO because he knows that the CBO will likely not be able to make firm estimates on savings from prevention and health information technology.

11) He then closed with a rhetorical flourish -- "That is the health care system we can build. That is the future within our reach" -- and left to generous applause.

Dr. Timothy Johnson is ABC News medical editor.