Recapping Obama's Townhall on Healthcare

Written by: PeopleKeep Team
Originally published on July 7, 2009. Last updated October 26, 2020.

Last week, President Obama hosted a town hall discussion about the future of health care inAmerica.  I'm going to go over what we can take away from his care reform

 First of all, he was incredibly vague about almost everything.  That's to be expected since he's a politician and has to be...political.  Here are the few things that he actually answered directly:

1. Reform will be passed in 2009

This is a great point for Obama to get across.  He explained that this is a complicated issue and it would be easy to spend years on research and negotiations, but that any action is better than inaction.  Also, while he didn't say it explicitly, but I thought he was implying that his administration will plan on tweaking whatever reform is passed as we learn what works and what doesn't.

2. The private insurance market will still exist

Lots of people are concerned that the federal government might completely take over insurance.  Obama made it clear that he doesn't want to do that, but that he does want some sort of federal plan that private carriers will have to compete with (to keep them honest).  He pointed out that 1/6 of the US economy is related to healthcare and even if he wanted to offer universal healthcare, upending such a large section of the economy is simply impossible.

3. For the most part, individuals will foot the bill

Right now we have Medicare to help seniors and Medicaid to help people with low incomes.  The plan will still need to cover these people along with anyone with pre-existing conditions.  However, the new plan needs to be "deficit neutral" which means that anyone that can afford their own healthcare will most likely still have to pay.

This also includes hints from Obama that he doesn't like the idea of employer-sponsored health care.  This is one of the topics that he was vague about but it sounds like he supports individual policies instead of group (YAY!) which probably means that either individuals will get the tax benefits that employers do now, or employers will lose some of their current tax benefits.  This is speculation on my part, but that's the only way I can make sense of what he said.

While we're on the topic, let's go over some of the things that Obama mentioned, but wasn't very specific about:

Quick Hits on Reform:

    • 2/3 of the cost of reform will come from re-allocating money that is already being spent on healthcare.  1/3 will come from new revenue (like capping itemized deductions for people making over $250,000/year).

    • The government won't sell all insurance, but they may offer a portal (called the "Health Insurance Exchange") where Americans shop for plans provided by private carriers.

    • There will be huge savings from wellness and medical I.T. initiatives, but it's impossible to calculate that right now so they're leaving those savings out of the projections.

    • The Mayo Clinic offers world class health care for significantly less than most hospitals.  The government is looking into how they can learn from Mayo's model.

    • Americans can help this process by informing themselves.  There's a lot of propaganda being thrown around and people are reacting with fear which hurts everyone.

What do I think about health care reform?

Feel free to form your own opinions about what the President had to say, but here's how I took it.

As is always the case, Obama said nearly all the right things.  The question so far has been if his administration is actually prepared to follow through with their promises.  The White House has received a lot of criticism about the lack of the "change" we were promised, and it looks like health care may be the very first major issue where we get to see if Obama can truly execute.

He said a few things that were just completely wrong.  For example, he mentioned that individuals buying personal policies don't have as much leverage with the insurance companies as members of groups.  This is about as wrong as you can get.  People with group insurance are stuck with whatever their employer offers them.  Individuals can use the power of the free market to force insurance companies to compete for their business.  Luckily, most of Obama's mistakes weren't particularly damaging to his overall point.

The best thing he said is that we need to move toward individual policies.  We at Zane Benefits have serious moral objections to group insurance (which we'll post about soon) and it's great to hear that the current administration agrees.  It was also great because this was McCain's stance which Obama disagreed with during their campaigns.  You might criticize Obama for flip-flopping, but at least he seems to have ended up in the right place.

Unfortunately, it doesn't sound like the legislative branch is on board with individual policies quite yet.  There may be some intense debate and if Obama's promise for reform this year holds true, we need to start making progress right away.

Stay tuned for some posts summarizing how other political figures are proposing we reform our health care system.


Originally published on July 7, 2009. Last updated October 26, 2020.


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