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Health Industry Voices Support for Obama Health Plan

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As President Barack Obama begins his push for health care reform, he finds a climate in Washington that may be more willing to work on the issue than in the past. Video by AP

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The president has cast the effort as a fiscal priority amid the economic crisis, calling it "a historic commitment to reform that will lead to lower costs and quality, affordable health care for every American."

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Rather than single out any one player in health care, Obama's plan would inflict "flesh wounds" on virtually every major stakeholder, said Nancy Chockley, president of the National Institute for Health Care Management, a nonprofit group funded largely by Blue Cross Blue Shield. The key, she added, is that none of the wounds would be fatal.

"You look down the list, and no one's going to be happy," Chockley said. "But nothing is a lay-down-the-gauntlet" style attack.

Melody C. Barnes, Obama's domestic policy adviser, said: "The important outcome for everyone is reduced costs. We all have to put something down on the table."

Keeping the major players on board could be crucial to Obama's success. The health-care sector is one of the mightiest political forces in Washington, spending nearly $1 billion on lobbying and contributing $162 million to candidates of both parties over the past two years, according to the Center for Responsive Politics. Obama's presidential campaign received nearly $19 million from health-care companies and their employees.

For the industry, expanded coverage could open up huge new markets. As drug companies learned when President George W. Bush and Congress created a new Medicare prescription drug benefit in 2003, "long-term success is built on market share," said Chris Jennings, a former Clinton health adviser.

"Expansion of coverage certainly creates a variety of opportunities for the private sector," said Sen. Ron Wyden (D-Ore.). The prospect of that new business is one way to "keep the powerful interests" at the bargaining table, he added.

Hospitals and physicians would also win significant reprieves under Obama's initial proposal. The president would leave untouched $20 billion in annual payments for hospitals that care for large numbers of uninsured patients, focusing instead on more modest cutbacks for doctors and hospitals that do not meet certain quality standards. His plan also includes budget language that would spare doctors a 21 percent reduction in pay next year and 5 percent cuts in future years.

Karen Ignagni, president and chief executive of America's Health Insurance Plans, said members of the insurers group are deeply concerned about Obama's proposal to switch the Medicare Advantage program to a competitive bidding process, arguing that it would force seniors to bear a disproportionate share of the costs. The administration says the change would save $175 billion over the next decade.

But Ignagni, who will attend today's summit, also said her group is willing to make sacrifices to reach an agreement. "The coin of the realm for 2009 is not the old-fashioned playbook of ads and 30,000-feet campaigns," she said. "The coin of the realm is for stakeholders to come to the table with real proposals and solutions."

Another major challenge could come from the AARP, which strongly objects to making wealthy seniors pay higher premiums for drug coverage. "Asking seniors to pay more is not a solution to the skyrocketing costs of prescription drugs," said spokesman Jim Dau. "Rather than shift more costs to seniors, AARP urges more focus on lowering soaring drug-cost increases."

William Dombi, a vice president of the National Association for Home Care and Hospice, complained that his relatively small sector is being hit inordinately hard by Obama's proposal to slash $37 billion in Medicare payments that the president says are bloated. "Because the others are bigger, they have greater entree and greater influence," Dombi said. "That's why they're not complaining -- they don't have anything to complain about."

Drew Altman, head of the Kaiser Family Foundation, said the debate "will get a lot tougher" in the months ahead. "We're still more in the happy-talk stage of health reform," he said, adding: "In Washington, there is a machine set up to fight every fight. No battle goes unfought."

Research editor Alice Crites contributed to this report.


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