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How Will Obama’s Healthcare Changes Impact Business?

Gina-Marie Cheeseman
| Friday November 28th, 2008 | 1 Comment

Obama.jpgThe U.S. healthcare system is in sorry shape. The Commonwealth Fund Commission gave the U.S. healthcare system a score of 65 (out of 100) when compared to other industrialized countries. The overall performance of the healthcare system did not improve from 2006 to 2008, and access to healthcare decreased. The efficiency of the healthcare system continued to be low.
The U.S. spends twice the amount per capita on healthcare that other industrialized countries do, but ranks last among 19 industrialized countries. It ranked 15th last year. The rate of uninsured adults increased from 35 percent in 2003 to 42 percent in 2007. According to the Commonwealth Fund Commission, “We are headed toward $1 of every $5 of national income going toward health care.”


Under President-elect Barack Obama’s plan, people who like their health insurance plans can keep them, but their costs “will go down by as much as $2,500 per year.” However, the uninsured and people who don’t like their coverage “will have a choice of new, affordable health insurance options.”
Obama’s plan will create a National Health Insurance Exchange which provides a “range of private insurance options” and a “new public plan” similar to the one that members of Congress receive. According to his transitional website, Change.gov, “Everyone who needs it will receive a tax credit for their premiums.”
For small businesses, Obama’s plan will create a Small Business Health Tax Credit so small businesses can offer health insurance coverage. Large businesses that do not offer coverage or provide low contributions will have to contribute a portion of payroll toward the costs of healthcare coverage.
The reduction in healthcare costs would come, in part, from lowering drug costs by allowing medicines to be imported from other industrialized countries, and increasing the use of generic drugs in public programs.
The Commonwealth Fund Commission believes that Obama’s plan will reduce the amount of uninsured people by 34 million in ten years. The Urban Institute thinks it will “greatly increase health insurance coverage.” However, the Urban Institute also believes that it will leave about six percent of the non-elderly population uninsured.
John Sheils, senior vice president of the Lewin Group, characterizes the plan as “quite traditional.” Sheils analysis of the plan found that it will decrease the amount of uninsured by 26.6 million in 2010, but will cost $1.17 trillion from 2010 to 2019.
Robert Ostrander of the Daily Messenger criticizes Obama’s plan because it “relies on employers to buy most health insurance.” He points out three problems with an employer-based healthcare coverage system: the employer is the customer in such a system and not the patient, multiple payers and benefit packages do not simplify the system, and adding “regulatory bureaucracy” adds to the cost of healthcare.
A single payer system?
“Until we move to a single-payer system and get rid of the profit motive in financing of health care, we will not be able to fix the problems that we have,” said Dr. Rocky White, who is on the board of Healthcare for All Colorado and author of Health Care Meltdown: Confronting the Myths and Fixing Our Failing System.
White points out that a multi-payer system is still “for profit” healthcare coverage. “You know, this industry is a $2-trillion industry, and the profits in the for-profit insurance industry are so huge and it’s so deeply entrenched into Wall Street.”
In 2003 Rep. John Conyers (D-MI) introduced the “Medicare for All” Act or HR 676. He reintroduced the Act in 2007. The Act would extend Medicare coverage to every U.S. resident. A National Health Insurance Card and ID number would be issued, and coverage would include prescription drugs, mental health services, emergency care, primary care and prevention, and vision care.
“The goal of the legislation is to ensure that all Americans will have access, guaranteed by law, to the highest quality and most cost effective health care services regardless of their employment, income or health care status,” Conyers’ website states.
In a February 2007 poll on healthcare, 64 percent preferred a universal health insurance program, even if it meant higher taxes, and 66 percent in a poll taken last summer. Sixty-four percent of those polled in November 2007 believe it is the responsibility of the federal government to make sure all Americans have health insurance coverage.


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  • Morgan

    There appears to be alot of waste in healthcare administration. Few “non-profit” healthcare companies are transparent about their CEO salary compensation and benefits.