If health care dies, Obama's modest budget Plan B

[February 02, 2010]  WASHINGTON (AP) -- President Barack Obama's modest health care budget may be a harbinger of what's ahead if his overhaul plan dies in Congress.

The budget released Monday contains lots of respectable ideas to squeeze savings, expand coverage and improve quality, but no ambitious change that launches the nation on a path to health care for all.

"It doesn't change dramatically the cost trajectory or fill the coverage gap," said Health and Human Services Secretary Kathleen Sebelius.

With costs widely acknowledged to be growing at budget-busting rates, the $915 billion health spending plan for 2011 would hire more fraud detectives to root out waste and outright thievery in Medicare and Medicaid, the two giant insurance programs for seniors and the poor. The budget would increase spending in one major anti-fraud area by 80 percent, part of a strategy the administration estimates could save taxpayers about $10 billion over 10 years.

As unemployment remains high and people continue to lose jobs with health insurance, the budget provides an emergency infusion of $25.5 billion to help state Medicaid programs cope with swelling enrollment in a period of slack revenues. It would also pump another $290 million to community health centers, frontline medical providers for many of the nearly 50 million uninsured.

As for quality improvements, the budget would start a host of experiments on how to improve care for seniors with multiple chronic health problems, who account for a disproportionate share of what Medicare spends annually. It also would provide a funding boost for a new field of research that aims to determine which medical treatments are most effective for the costliest conditions. Speeding the adoption of computerized medical records is another priority.

All in all, Sebelius called the budget "a platform" -- a beginning, not an end. She said she hopes lawmakers will revive the health care bills sidelined after Democrats lost their 60-seat majority in the Senate, and undisputed control of the congressional agenda. "I think we need both," she said.

The health care overhaul legislation would provide coverage to more than 30 million now uninsured. It wouldn't add to the federal deficit, but it would increase health care spending as people used their new coverage. However, in the long run, some of the cost control measures would slow the pace of annual increases, offering the promise of savings.

As a technical matter -- an asterisk -- Obama's budget assumes the health care remake will pass Congress, generating $150 billion in savings over 10 years.

Most of the government's health care spending in any given year -- nearly $832 billion of the total for 2011 -- is on autopilot, allocated to Medicare and Medicaid. Congressional Democrats tapped Medicare to finance much of their proposed overhaul legislation, and the deficit-reduction commission Obama is promising in his budget is sure to see it as a source for revenue.

Beyond the big areas of costs and coverage, Obama's budget provides targeted increases for research, public health and prevention.

The National Institutes of Health would get an additional $1 billion for research into such fields as genetic medicine that could produce breakthrough drugs and treatments. Administration priorities include cancer and autism research.

The Food and Drug Administration's budget for food safety -- cut under President George W. Bush -- gets a 30 percent, $327 million boost.

And revenues from a tobacco tax hike that Obama signed into law last year will be pumped into a campaign to prevent teens from taking up the habit.

Finally, there's also a $383-million health care hit in the budget. Obama is proposing to eliminate congressional earmarks for building hospitals and other facilities, including $10 million for Alaska and $35 million for Mississippi.

[Associated Press; By RICARDO ALONSO-ZALDIVAR]

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