US PRESIDENT Barack Obama has moved to revive his stalled healthcare overhaul with a new plan to make insurance more affordable and bolster federal authority to regulate premium hikes. Obama's proposal gives the Health and Human Services Department new authority to keep escalating healthcare costs under control. The overhaul plan, expected to cost $950bn over 10 years, is Obama's attempt to bridge the gap between stalled healthcare legislation passed by the House and Senate last year. The proposal would cover 31-million uninsured Americans. It also adds $10bn in industry fees to help close the so-called doughnut hole in drug coverage for elderly Medicare patients and bans deals in which pharmaceutical companies pay makers of generic medicines to keep cheaper copies of brand-name drugs off the market. The move is a reversal after months of the White House leaving details of the largest US medical overhaul in more than four decades up to congressional Democrats. Obama had invited Republican leaders and top congressional committee members to a meeting last week, calling on them to release a "comprehensive bill" of their own that would cover millions of uninsured Americans and reduce rising medical care costs. He urged legislators to attend in "good faith" as he decried "jaw-dropping" insurance rate increases he said underscore the need for remedies. Obama has this month singled out several companies for high premium increases, including a subsidiary of WellPoint, the biggest US insurer of individuals and small businesses. In his weekly radio address on Saturday, he said customers of Anthem Blue Cross of California recently "opened up their mailboxes to find a letter" containing news that it wanted to raise premiums "by an average of 25%, with about a quarter of folks likely to see their rates go up anywhere from 35% to 39%". His plan includes the creation of a government panel to set rules for reasonable rate increases. The proposal, first advanced in legislation introduced by Democrat Senator Dianne Feinstein, would create a seven-member health insurance rate authority to make recommendations on rate reviews and approvals. It would include consumer representatives, an insurance industry representative, a doctor, and experts in health economics, actuarial science and related fields. It would publish an annual report on insurance market behaviour, the official said. Under the proposal, the Health Secretary could also delegate enforcement to a state insurance regulator to block the premium hike or order its modification. Obama's legislative proposal on healthcare comes after legislation that would require all Americans to have insurance stalled in Congress amid Republican opposition. Republicans have criticised the Democratic legislation, saying it is too expensive at about $1-trillion over 10 years, that it unfairly forces people to obtain insurance, and that it would lead to a government takeover of healthcare. To sidestep Republican opposition, the Democrats may use a procedure called reconciliation, which would require just 51 Senate votes to pass. That may pose a problem because Senate rules require reconciliation to deal only with revenue and spending, which would mean the bill may have to be stripped down. House and Senate legislators were days away from overcoming differences when the January 19 special Senate election in Massachusetts deprived Democrats of the 60th vote they needed to get the new compromise through that chamber. Now, legislators are looking to Obama to finish the job.
Bloomberg, Reuters via Business Day, 23 February 2010
