Orszag Defends Health Care Overhaul Plan
The Obama administration is proposing an ambitious overhaul of the health care system. White House Budget Director Peter Orszag says the transformation of the $2 trillion sector is unlikely to occur without some jostling or concerns being raised.
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MICHELE NORRIS, host:
It's ALL THINGS CONSIDERED from NPR News, I'm Michele Norris.
ROBERT SIEGEL, host:
And I'm Robert Siegel.
As President Obama pushes to overhaul the nation's health care system, doctors, hospitals and others are raising sharp concerns. One worry centers on the president's call for a government run insurance plan to compete with private plans. And we'll hear the concerns of hospitals just ahead. First, we raised a few of these issues today with Peter Orszag, the director of the Office of Management and Budget.
NORRIS: I visited Peter Orszag in his office this afternoon. It's a large ornate office in the Eisenhower Executive Office Building next to the White House. The rooms once served as the temporary office for the Secretary of War. Mr. Orszag is engaged in another kind of conflict now. I asked him how long it could take to provide health coverage for America's uninsured.
Mr. PETER ORSZAG (Director, Office Of Management And Budget): The coverage is likely to ramp up over time. It takes the time to put in place things like a health exchange, which is the way in which people who currently lack insurance would have an opportunity to purchase it. And in terms of the numbers we want to be on the path to eliminating the number of uninsured people in the United States.
NORRIS: So is it realistic to think that 46 million people who are currently without health insurance, will, within 10 years, see health care coverage?
Mr. ORSZAG: It depends. The bulk of them - yes. Depending on the plan that is adopted, it may not be possible to cover everyone. But I think the goal is to get solidly on the path and cover the bulk of them.
NORRIS: Let me ask you about the public plan as envisioned by the White House. How do you make sure that enough doctors and clinics and hospitals and health care providers participate in that plan? And how much muscle is the White House willing to use to make sure that they participate?
Mr. ORSZAG: The goal of a public plan option is to expand choice, introduce more competition, and thereby drive down premium costs for beneficiaries. Beyond that, there are lots of ways of accomplishing those goals through a public plan option and we're seeing a healthy debate about different mechanisms for doing so.
NORRIS: And how much muscle is the White House willing to use to make sure that doctors, and health care providers, hospitals participate in the plan?
Mr. ORSZAG: Well again, I think our goal here is not to force doctors and hospitals to do things that they don't want to do, but rather to create a plan that we think they'll want to participate in. And that beneficiaries will find helpful, also, in terms of having more choices available.
NORRIS: On the other side, I'm curious about how you plan to make sure that patients participate in the plan. My colleague, Robert Siegel, has been spending time examining the health care system in Howard County…
Mr. ORSZAG: Mm-hmm.
NORRIS: …not far outside Washington, D.C., in suburban Maryland. And he found there that people who have the option of participating in a relatively low cost system, $50 a month, choose not to do so for all kinds of reasons. So without a mandate - a word that's floated for all kinds of reasons - how do you make sure that the public participates in the public plan?
Mr. ORSZAG: Well, first, no one is saying the public has - that anyone has to participate in a public plan. There are proposals and the president is open to - to have some form of personal responsibility where you would have to carry insurance, just like you do, you know, when you drive a car. But you could purchase that insurance through a health exchange where the public plan would be one of many options. So that's, I'd say, the leading approach. It's also the case that, for example on retirement saving, one of the things that's been various effective at encouraging participation is to automatically enroll beneficiaries or workers in a 401(k) plan and allow them to opt out.
But I think the leading proposal that's emanating from Capitol Hill right now, is one in which you would be required to participate unless that imposed very significant hardship and there'd be a hardship exemption. But again it's not -you wouldn't be required to participate in a public plan. In fact, if anything the opposite, you would be given a wide array of choices and the public plan is intended just to expand that number of choices.
NORRIS: How do you get the hospitals on board? There are 5,700 plus hospitals in the country. They certainly do not speak with one voice. But a lot of them don't like what they're hearing from the White House. How do you bring them on board?
Mr. ORSZAG: The American Hospital Association was part of the group that came to meet with the president and agreed that we could wring more efficiencies out of the existing health care system. Now, it may well be that, as specific ideas are put on the table, this group or that group have objections that are part of the process. That makes - we're not going to transform a two trillion dollar sector of the economy without some jostling occurring and some objections being raised, or concerns being raised - that's natural.
NORRIS: Let me address one of their principal concerns. They're saying the proposed - and I want to make sure I get the figure right, I believe it is $200 billion in cuts in federal payments to the hospital system - the proposed cuts to the hospital system will have the biggest impact on the people who need the health care system the most. That it will hit the infirmed, the elderly, the poor. Why are they wrong?
Mr. ORSZAG: Well, I think they're wrong. Let's take for example, the so-called disproportionate share hospital payment proposal. Currently under both Medicare and Medicaid, the federal government provides funding to hospitals to help - in large part to help meet the cost of the currently uninsured. Our argument is, as the number of uninsured goes down, the hospitals in a sense would be being double paid, if the number of uninsured people decline significantly and they were still receiving payments to meet the cost of the uninsured. So we scale those back and we also would target those payments more efficiently towards the hospitals that are disproportionately serving the remaining uninsured.
NORRIS: Mr. Orszag, thank you very much.
Mr. ORSZAG: Thank you.
NORRIS: That was Peter Orszag, the White House Budget Director.
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Orszag Defends Health Care Plans Amid Criticism
President Obama is pushing to overhaul the nation's health care system, but doctors, hospital officials and others are raising sharp concerns over his call for a government-run insurance plan to compete with private plans.
Peter Orszag, director of the White House's Office of Management and Budget, defends the plan, telling NPR's Michele Norris that it will put the U.S. "on a path to eliminating the number of uninsured people in the United States."
Orszag says evidence suggests that many insurance markets lack adequate competition, and the goal of the public plan is to expand choice, introduce more competition and drive down premium costs.
"Our goal here is not to force doctors and hospitals to do things that they don't want to do, but rather to create a plan that we think that they'll want to participate in, and that beneficiaries will find helpful also in terms of having more choices available," he says.
One challenge the administration faces, however, is that in areas such as Howard County, Md., which offers relatively low-cost health coverage to its residents, many don't enroll. Orszag says no one would be required to participate in a public plan, but "there are proposals that the president is open to — to have some sort of personal responsibility where you have to carry insurance just like you do when you drive a car. But you could purchase that insurance through a health exchange where the public plan would be one of many options."
Concerns From Hospitals
One aspect of the proposal that has come under fire is a proposed $200 billion cut in federal payments to hospitals. Hospital officials say that will result in cuts in services to the people who need it most.
But Orszag says that, for example, under the reimbursement system known as disproportionate share payments, government funding is provided to hospitals in large part to help meet the cost of caring for the uninsured.
"Our argument is that as the number of uninsured goes down ... the hospitals would in a sense be double-paid if the number of uninsured people declines significantly and they were still receiving payments to meet the cost of the uninsured," he says. "So we scale those back, and we would also target those payments more efficiently toward the hospitals that are disproportionately serving the remaining uninsured."
Rich Umbdenstock, president and CEO of the American Hospital Association, tells NPR's Robert Siegel that the hospitals have accepted "in principle" that reimbursements from Washington will decline as the number of insured patients rise at those institutions. But, he says, too many questions remain.
"How soon will that coverage kick in? At what payment levels? Across what proportion of the uninsured population?" he asks. "Even by the best estimates, right now, people are saying that it looks like some of the plans that are out there can cover maybe a third, maybe, at the high end, two-thirds of the population. That still leaves a lot of people uncovered. It still leaves a lot of people on the Medicaid program, and it still leaves a lot of people who are undocumented immigrants and so on. That need's not going to go away overnight."
Orszag says opposition to the health care overhaul is inevitable. "We're not going to transform a $2 trillion sector of the economy without some jostling occurring and without some objections being raised or some concerns being raised," he says. "That's natural."
And Umbdenstock says all the stakeholders in the health care system have to examine what they can do now to cut costs.
"You have to look at cuts in the context of a complete plan for reform. And our elements in reform include the important element of affordability," Umbdenstock says. "But also we have to think about coverage. We have to think about quality."
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