White House: Health reform would curb cost growth

The White House's Council of Economic Advisers has released a report that finds health reform would slow the growth of health costs in the United States and buttress the economy.

"As the Senate heads into a critical week of health-care negotiations, the White House sought Monday to bolster the case for reform, arguing that the Senate bill would cut the soaring rate of growth in health costs by 1 percent a year over the long haul, reducing federal budget deficits and producing thousands of dollars in benefits for the average family," The Washington Post reports. The calculations "confirm that total spending on health care initially would increase under the Senate bill, as more than 30 million additional Americans obtain coverage, either through newly regulated private insurance markets or through Medicaid, the government health program for the poor. But council chair Christina Romer argued in a conference call with reporters that other provisions in the legislation -- including changes in the delivery of health care and a new tax on high-cost insurance policies -- would push the cost of care down, saving the government and individuals money 'over an extended horizon'" (Montgomery, 12/14).

The Hill: "The bill's effects on both employment and unemployment, 'at first approximation, should be zero,' Romer said, adding that the new rules in the bill would free up individuals' and business' resources to reinvest in the economy. 'That means that GDP can be higher,' she said. 'We think that by 2030, properly measured GDP would be 4 percent higher than it would have been.' Romer added that such economic growth could translate to as much as a $7,000 increase in median family income over time" (O'Brien, 12/14).

CongressDaily: The report "estimates that national healthcare spending will drop by 0.5 percent under the Senate's overhaul bill, a rosier projection than the 0.7 percent increase estimated Friday by the chief actuary at the Centers for Medicare and Medicaid Services. CEA Chairwoman Christina Romer said the Senate bill is 'the most important thing we can do for the long-run fiscal health of the country'" (12/14).

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This article was reprinted from khn.org with permission from the Henry J. Kaiser Family Foundation. Kaiser Health News, an editorially independent news service, is a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization unaffiliated with Kaiser Permanente.