Health policy experts estimate the price for providing universal health care to Americans could reach $1.5 trillion over the next ten years, more than double the $634 billion President Barack Obama has set aside to overhaul the U.S. healthcare system.
Some 48 million people in the United States are uninsured, and the problem is expected to worsen as the cost of coverage rises.
Nevertheless, administration officials have avoided providing a detailed cost estimate for Obama’s reform proposal, saying it would depend upon how Congress would work out the details.
“It’s impossible to put a price tag on the plan before even the basics have been finalized,” an Associated Press report quoted White House spokesman Reid Cherlin as saying.
“Here’s what we do know: The reserve fund in the President’s budget is fully paid for and provides a substantial down payment on the cost of the reforming our health care system.”
The potential for surging healthcare overhaul costs concerns some Democrats and Republicans alike, as Congress works to prepare a draft of next year’s budget.
The U.S. currently spends $2.4 trillion annually on health care, more than any other developed nation, one-third of which goes for tests and procedures rather than treatment and prevention, according to experts.
“We shouldn’t just be throwing more money on top of the present system, because the present system is so wasteful,” Senator Judd Gregg (R-NH), the ranking Republican on the Senate Budget Committee.
The health care plan Obama proposed during his presidential campaign would have cost nearly $1.2 trillion over a decade, according to an estimate last fall by the consultancy firm Lewin Group. And that proposal would not have covered all the uninsured, something most congressional Democrats seek to do.
Lewin Group senior vice president John Sheils said $1.5 -$1.7 trillion would be a plausible estimate for a plan that covers all Americans, or roughly 4 percent of the total projected health care costs over the next decade.
The cost of providing healthcare coverage to the uninsured is “a difficult hurdle to get over,” Sheils told AP.
“I don’t know where the rest of the money is going to come from,” he added.
Some of the top supporters of universal healthcare estimate the cost at roughly $1.5 trillion.
“Honestly … we can’t do it for the $634 billion the president put in the reserve fund,” said John Rother, an AARP public policy director, at an insurance industry meeting in Washington last week.
“In all likelihood, it will be over $1 trillion,” he said, estimating the cost would be about $1.5 Trillion.
Economist Len Nichols, who oversees the health policy project at the New America Foundation, told AP that universal coverage will cost $125 billion to $150 billion a year.
However, earlier this month Peter Orszag, the White House budget director, told the House Budget Committee that Obama’s $634 billion fund is “likely to be the majority of the cost.”
About half of that money would come from spending reductions, while the other half would come from increased taxes.
However, the cost “will depend on the details of whatever is finally done … as we move through the legislative process,” Orszag said.
The total costs are an important issue since the expansion of health coverage is intended to be a permanent reform, meaning future generations of Americans will fund the changes.
“We are dealing with huge numbers,” former U.S. comptroller general David Walker said, according to the Reuters report.
“We need to have a much better sense of what we are talking about doing, and whether or not it’s affordable and sustainable over time, said Walker, now head of the Peter G. Peterson Foundation, which promotes fiscal responsibility.
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