Biography
Jason Wahlman is currently pursuing a Master of Public Health degree in Public Health Administration and Policy at the University of Minnesota School of Public Health. His research interests include universal health insurance and Medicaid pharmacy policy. In addition to pursuing his degree, Jason works for Mercer’s Government Human Services Consulting practice, where he provides policy analysis and program evaluation for state Medicaid agencies’ behavioral health and pharmacy programs. He completed his undergraduate education at Brown University with a degree in sociology and business economics.

During his campaign, President Obama argued for health care reform by saying that health care is a right. [1] The framework for reforming health care that President Obama outlined during his campaign includes three primary elements: providing affordable health insurance for all Americans, lowering health care costs, and promoting public health. [2] While all three elements are essential in reforming America’s health care system to provide higher quality care at lower cost, providing health insurance for all Americans should be prioritized given the effect the current economic crisis has on the number of uninsured Americans. Although this element of President Obama’s framework should be prioritized, it will also be the most challenging to implement, since universal health care coverage represents a dramatic shift from current health care policy and will require substantial increases in government spending.

Providing health insurance for all Americans should be President Obama’s priority in the current economic crisis because many Americans will lose their private health insurance coverage as they become unemployed. At the end of January 2009, the unemployment rate in the United States was 7.6 percent, and some economists predict that the unemployment rate may reach as high as 12 percent before the economy begins to improve. [3] One estimate of the relationship between the unemployment rate and the number of uninsured is that each percentage point increase in the unemployment rate leads to 1.1 million more adults not being insured. [4] Thus, between now and the end of the economic crisis, approximately five million adults could lose their private insurance coverage.

President Obama should be concerned about the large number of uninsured Americans because of the negative health outcomes and reduced economic productivity associated with being uninsured. According to the Institute of Medicine, the uninsured tend to have poorer health quality and die prematurely compared to people with insurance, and the economy suffers due to reduced productivity from the millions of uninsured Americans who have poor health or who are prematurely disabled. [5]

While providing health insurance for all Americans is the most important element of President Obama’s health care reform framework, it will also be the most challenging element to implement due to political opposition and high costs. Universal health care coverage represents a fundamental shift in health care policy in the United States and does not have widespread support among Republican members of Congress. Moreover, unlike President Obama’s health care reform element of reducing health care costs, universal health care coverage will require large increases in spending from the federal government, likely necessitating higher taxes. President Obama’s proposal to provide coverage for the 47 million Americans who were uninsured as of January 2008 is estimated to cost $102 billion per year. [6] As the number of uninsured Americans continues to increase, so does the cost of providing universal coverage.

Some cost savings initiatives in President Obama’s health care reform framework will also be challenging to implement, since they will be strongly opposed by the health care industry and some members of Congress. President Obama’s framework for reforming health care contains many initiatives aimed at lowering health care costs, including regulating health plan loss ratios and increasing the use of generic drugs. [7] The insurance industry will oppose President Obama’s proposal to regulate health plan loss ratios because it will reduce industry profits. Congress has passed legislation regulating loss ratios before (for Medigap policies), and there is evidence that it did result in higher loss ratios and lower profits for insurers. [8] The pharmaceutical industry will oppose President Obama’s proposals to increase regulation of the industry, expedite generic drug development and approval, and import drugs from other developed countries because these proposals would reduce the profitability of the pharmaceutical industry. Since President Obama’s health care reform proposal involves significantly more regulation of the insurance and pharmaceuticals industries, he is also likely to face opposition from many Republicans in Congress.

While some of President Obama’s cost savings initiatives will be strongly opposed, other cost savings initiatives are likely to garner support given the current economic crisis. President Obama’s health care reform framework contains several costs savings initiatives that are not as controversial, including spending $50 billion to improve health care information technology and improving the management of chronic medical conditions. [9] These two initiatives will provide increased quality and cost savings in the future, although they will require upfront investments. Despite the upfront costs, these two initiatives will likely garner support from Congress and the health care industry because they reflect an investment in health care that does not significantly affect the profitability of the health care industry and because the total cost of these initiatives is far less than the cost of universal health care coverage.

President Obama’s health care reform framework element of promoting public health is also likely to garner some support due to its relatively low cost and negligible impact on the profitability of the health care industry; however, it is unclear how this element will be implemented and what effect it will have on the cost and quality of health care. Thus, while President Obama may believe this is an important element of health care reform, it is less likely to gain support than his pursuit of universal coverage.

President Obama’s health care reform framework is ambitious and represents a dramatic change in health care policy for the United States. When he originally proposed the plan during the campaign, he did not anticipate the current economic crisis. Yet, the economic crisis has made it even more important for President Obama to address the availability of insurance for all Americans, as the economic crisis has left millions more uninsured than just one year ago. President Obama will need to overcome significant political and health care industry opposition to achieve his goal of health insurance for all Americans, but if he accomplishes this goal it will result in better health for millions of Americans and a health care system that will treat health care as a right.