California Healthline Daily Edition

Summaries of health policy coverage from major news organizations

Experts Say Cost of Obama Health Care Plan Could Top $1.5 Trillion

President Obama's proposal to expand health insurance to all U.S. residents could cost about $1.5 trillion over the next 10 years, according to health policy experts, the AP/Seattle Post-Intelligencer reports.

According to the AP/Post-Intelligencer, administration officials have "pointedly avoided providing a ballpark estimate for Obama's fix, saying it depends on details to be worked out with Congress."

White House spokesperson Reid Cherlin said, "It's impossible to put a price tag on the plan before even the basics have been finalized," adding, "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 reforming our health care system."

Earlier this month, White House Office of Management and Budget Director Peter Orszag said that, although the reserve fund is "likely to be the majority of the cost," the amount of the cost covered by the fund "will depend on the details of whatever is finally done ... as we move through the legislative process."

John Sheils, a senior vice president of the Lewin Group, said the Obama health care reform proposal likely would cost between $1.5 trillion and $1.7 trillion over the next 10 years. In an interview, Sheils said that the cost is "a difficult hurdle to get over." He added, "I don't know where the rest of the money is going to come from."

During a health insurance industry meeting in Washington, D.C., last week, John Rother, public policy director for AARP, said, "Honestly ... we can't do it for the $634 billion the president put in the reserve fund," adding, "In all likelihood, it will be over $1 trillion," likely $1.5 trillion.

Economist Len Nichols, head of the health policy project at the New America Foundation, cited the cost at between $125 billion and $150 billion annually.

David Walker, a former U.S. comptroller general and current head of the Peter G. Peterson Foundation, said, "We are dealing with huge numbers," adding, "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" (Alonso-Zaldivar, AP/Seattle Post-Intelligencer, 3/18). This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.