Price of health care plan is a doozy
President Barack Obama makes comments on the Fiscal Year 2010 budget in the Eisenhower Executive Office Building min Washington, D.C.
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KAI RYSSDAL: There is a certain element of "you've got to spend money to save money" in the president's budget plan. He's promising a major overhaul of the health care system, with universal coverage in a decade. But the price tag of that is a doozy: $684 billion over those 10 years as a downpayment.
From North Carolina Public Radio, Marketplace's Janet Babin reports now on how he's going to get there.
JANET BABIN: Some $600 billion sounds like a lot for universal health care. But analyst Steve Brozak at WBB Securities argues we don't understand how expensive our health care is right now:
Steve Brozak: Most people have a better idea of the real cost to get an oil change on their car than what it really costs to get a Cat scan. That's pretty ridiculous.
In fact, the government says the U.S. spends more than $2 trillion a year on health care now. And millions of people don't even get coverage.
The new plan pays for the reforms in two ways: taxes and spending cuts. The Obama administration would phase out tax cuts enacted during the Bush administration, for people who make more than $250,000 a year.
And the new plan would shrink payments to Medicare by $316 billion. That's the system that funds health care to the elderly and disabled.
Miller Tabak analyst Les Funtleyder wrote the book "Healthcare Investing." He says without reform the economy suffers:
Les Funtleyder: America is at a disadvantage to other places in the world who have single-payer systems. It does put a burden on our companies. I mean, even China has said they wanted to do a universal health care program.
Some Republicans complained today that the president's proposal is too expensive. They don't want to see breadwinners taxed more during a recession.
But Len Nichols with the non partisan New America Foundation says lawmakers may be closer to compromise than they let on.
Len Nichols: I know there is far more bipartisan conversation going on -- at least on the Senate side -- than is perhaps evident in public.
That behind-the-scenes wrangling will probably continue for a few more weeks. More details about the plan are expected to emerge in April.
I'm Janet Babin for Marketplace.