Keeping The Costs Of Health Care Reform In Context

President Obama’s budget allocates $634 billion towards health care reform, a good start, but it’s certainly not enough to reach universal coverage. Today, the AP interviewed health care policy experts who estimate that “the Obama proposal to expand health insurance to all U.S. residents could cost about $1.5 trillion over the next 10 years”:

John Sheils, a senior vice president of the Lewin Group, said about $1.5 trillion to $1.7 trillion would be a credible estimate for a plan that commits the nation to covering all its citizens. That would amount to around 4 percent of projected health care costs over the next 10 years, he added.

Recently, Sens. Judd Gregg (R-NH) and Kent Conrad (D-ND) argued that the administration should not invest new money into an already bloated health care care system, suggesting instead, that Obama could somehow surgically remove the $700 billion in waste and reinvest that amount into reforms.

$1.5 trillion isn’t chump change, but it’s nothing if compared to the full cost of inaction. A $1.5 trillion plan (much of it paid for, just like the President’s $634 billion allocation) is meant to bend the curve on health care spending. Otherwise, total health spending will double “by 2020 — rising from a projected $2.6 trillion in 2009 to $5.2 trillion by 2020 to consume 21 percent” of the GDP.


As premiums increase over time, millions of Americans will lose their jobs, many more will forgo coverage, file for bankruptcy due to unaffordable health care costs, and die due to complications from being uninsured.

Reform cost estimates are large numbers only if we strip them of their human context and future cost projections.