In Letter To Kennedy And Baucus, Obama Outlines Principles For Health Reform

Following on his meeting earlier this week with Democrats from the Senate Finance and HELP committees (the two committees with jurisdiction over health reform legislation), President Obama has sent a letter to the committees’ chairmen–Sen. Max Baucus (D-MT) and Sen. Ted Kennedy (D-MA)–restating his priorities, and committing to some new spending cuts to generate revenue to pay for comprehensive legislation.

You can see the entire letter here, but some of the key points are:

I am committed to working with the Congress to fully offset the cost of health care reform by reducing Medicare and Medicaid spending by another $200 to $300 billion over the next 10 years, and by enacting appropriate proposals to generate additional revenues. These savings will come not only by adopting new technologies and addressing the vastly different costs of care, but from going after the key drivers of skyrocketing health care costs, including unmanaged chronic diseases, duplicated tests, and unnecessary hospital readmissions.

To identify and achieve additional savings, I am also open to your ideas about giving
special consideration to the recommendations of the Medicare Payment Advisory Commission (MedPAC), a commission created by a Republican Congress. Under this approach, MedPAC’s recommendations on cost reductions would be adopted unless opposed by a joint resolution of the Congress. This is similar to a process that has been used effectively by a commission charged with closing military bases, and could be a valuable tool to help achieve health care reform in a fiscally responsible way.

Congress has demanded that health reform efforts be deficit neutral–meaning Obama must pay for the initial costs with a combination of efficiency savings and increased taxes or spending cuts. For more on how the MedPAC plan would work, see this post. Much of this ground, apparently, was covered at the meeting–and soon we’ll know whether it’s the sort of stuff Congress will go for.