Image source: www.whitehouse.gov

Last night, President Barack Obama made his healthcare reform speech to Congress, adamantly expressing his determination to be the final U.S. president to take up this cause.

As Obama pointed out, “[o]ur collective failure to meet this challenge -- year after year, decade after decade -- has led us to a breaking point.”

As a result, he expressed his desire to have a healthcare system that covers all Americans without contributing to rising costs. instead of one that places "an unsustainable burden on taxpayers.” In fact, he noted that the United States spends “one-and-a-half times more per person on healthcare than any other country, but we aren't any healthier for it.”

He proposed a plan to meet three basic goals:

• To provide more security and stability to those who have health insurance;
• To provide insurance to those who do not have health insurance; and
• To slow the growth of healthcare costs for families, businesses and government.

He emphasized repeatedly that nothing in the new plan would force individuals to change their current health insurance—whether covered by private insurance, Medicare, Medicaid, or the Department of Veteran Affairs.

Under his plan, insurance companies would have new requirements, even though the President said it was not his goal to put payors out of business, but to make them accountable. The president's plan stipulates that:

• It will be against the law for insurance companies to deny coverage because of a pre-existing condition.
• It will be against the law for insurance companies to drop coverage when an individual gets sick, or “water [the coverage] down.”
• Insurance companies will no longer be able to place an “arbitrary cap” on the amount of coverage an individual can receive in a given year or a lifetime.
• A limit will be placed on how much an individual can be charged for out-of-pocket expenses.
• Insurance companies will be required to cover, with no extra charge, routine checkups and preventive care, such as mammograms and colonoscopies.

Also, for those who lose health insurance, Obama said that those individuals will get coverage by “creating a new insurance exchange – a marketplace where individuals and small businesses will be able to shop for health insurance at competitive prices.”  And for individuals or small businesses that still could not afford the lower-priced insurance available in the exchange, the government will provide tax credits, the size of which will be based on need.

However, businesses would be required to either offer health insurance to their employees or contribute to help cover the cost of their employees. Obama added that there would be a “hardship waiver for those individuals who still cannot afford coverage, and 95 percent of all small businesses, because of their size and narrow profit margin, would be exempt from these requirements.”

While the President acknowledged there “remain some significant details to be ironed out,” he said that the public option is only one component of his plan and “should not be used as a handy excuse for the usual Washington ideological battles.”

In terms of paying for these proposals, which he predicts would cost $900 billion over 10 years, Obama promised he would not sign a plan that adds “one dime to our deficits – either now or in the future.” Also, he suggested that the majority of the plan could be paid for from savings within the existing healthcare system, if “waste and abuse” are avoided.

Finally, he noted that medical malpractice laws can help bring down the cost of healthcare, adding that defensive medicine is “contributing to unnecessary costs.”