The wonkosphere is abuzz today with news that five healthcare industry groups and at least one major union will meet with Obama at the White House today to announce a new cost-savings initiative.
The plan aims to cut the rate of growth in healthcare costs by 1.5 percent each year for 10 years–a total of $2 trillion.
The stakeholders: Pharmaceutical Manufacturers of America (PhRMA); Advanced Medical Technology Association (AdvaMed); America’s Health Insurance Plans (AHIP); the American Hospital Association (AHA); the American Medical Association (AMA); and the Service Employees International Union (SEIU).
What does this mean? All of the groups (except SEIU) have been major opponents of healthcare reform in recent years, and continue to oppose a public insurance plan to compete with private insurers.
Regardless, the consensus is that this is unequivocally good news for Obama’s hopes of pushing through big, comprehensive healthcare reform this year.
The mere sight of these groups standing shoulder-to-shoulder with Obama will give reform additional political momentum, driving an even bigger wedge between health industry groups and their erstwhile allies in the conservative movement–where dismay over the behavior of AHIP and other groups is becoming louder by the day.
The event will also give lawmakers in Congress political cover for proposing bolder changes to the payment and delivery systems–the kind that might make reform seem more affordable, at least in the eyes of the all-important Congressional Budget Office.
This is big — and I’m not talking about the news. I’m talking about the dealmaking between unions, corporations, the health insurance companies and hospitals. And there all going to be at the White House tomorrow. What’s the bottom line political significance of all of this: it means that the White House is gonna get health care reform, this year.
The fact that the medical-industrial complex is trying to shape health care reform rather than block it is a tremendously good omen. It looks as if America may finally get what every other advanced country already has: a system that guarantees essential health care to all its citizens.
And serious cost control would change everything, not just for health care, but for America’s fiscal future. As Mr. Orszag has emphasized, rising health care costs are the main reason long-run budget projections look so grim. Slow the rate at which those costs rise, and the future will look far brighter.
I still won’t count my health care chickens until they’re hatched. But this is some of the best policy news I’ve heard in a long time.
So there you have it. Politically, this is nothing but good news for the administration. It will be infinitely harder for Republicans to oppose a reform package when the major industry groups–these are the Harry and Louise people–are on board, at least in principle.