Heritage Foundation Leadership for America

The President's Budget

• The Actual Cost: The $634 billion in the President's budget is only a "down payment" on health care reform. Experts believe that the actual cost of Obama's health care plan could reach $1.6 trillion over 10 years. This is in addition to the trillions of dollars Obama has already spent on health care this year through the stimulus and SCHIP.
• Details, Please: On such an important piece of the President's budget and agenda, there is little detail on what the Administration expects to spend with the $634 billion down payment. American taxpayers deserve the right to know the key elements of this massive budget proposal.
• Tax Hikes, Again: President Obama's plan depends on raising taxes on charitable giving and cutting home mortgage deductions to pay for health care. Some in Congress are suggesting using carbon taxes to pay for it. America spends over $2 trillion (or close to 17% of GDP) on health care. When is it enough, and when are taxes not the answer?
• Family Planning: The President's budget isn't timid in expressing its goal to expand Medicaid family planning funding. These provisions undermine parental authority by allowing children of any income level to qualify for family planning benefits without parental approval.

The Down Payment

• A Familiar Pattern: The actual costs of the President's health care proposals are invariably higher than the original government projections. The Obama budget document affirms as much: "The Budget calls for an effort beyond this down payment, to put the Nation on a path to health insurance coverage for all Americans. However, additional funding will be needed."
• Unproven and Misdirected Savings: The budget depends on technical tinkering of administrative payments in Medicare and Medicaid to produce savings. Dependence on many of these so-called delivery reforms are unproven and will likely result in the typical ratcheting down of provider payments.
• Entitlement Reform: Moreover, President Obama said he supported entitlement reform. Shouldn't Medicare and Medicaid savings be redirected to shore up these fiscally bankrupt programs?

Alternative Health Care Policies

• Be Imaginative: Instead of employing old-fashioned, populist "soak the rich" tax hikes combined with technocratic tinkering of administrative and software programs, the President should fix America's flawed public and private third-party payment system, in which value is secured for "payers," not individual patients.
• Direct Control: If the President wants to effect real change--and secure value for individual patients rather than third-party payers--he should take concrete steps to transfer direct control over health care dollars and decisions to individuals and families.
• Consumer Choice: Give Americans a true consumer-choice system modeled after the one available to Members of Congress, not a façade for government-run health care.
• Take Bold Steps, Give States the Power: Allow states to experiment with better ways of reaching the nation's health coverage goals rather than imposing a national plan on states and families.

For more information, please visit:http://blog.heritage.org/2009/04/02/the-obama-health-care-budget-a-trillion-dollar-down-payment-on-what.