President Obama on Wednesday during a town hall meeting in Costa Mesa, Calif., discussed his fiscal year 2010 budget proposal, which he has said includes a large amount of funds for health care reform and other efforts that might not lead to results for years, the Washington Post reports. Obama held the meeting as part of a two-day trip to Southern California that begins his national campaign to raise public support for his proposal (Wilson, Washington Post, 3/19). During the meeting, Obama also discussed the recently enacted economic stimulus package (Welch, USA Today, 3/18).

Before he took questions, Obama discussed a provision in his budget proposal that would establish a $634 billion health care reserve fund funded in part by an increase in taxes for U.S. residents with annual incomes of more than $250,000. He said, "It allows us to pay for health care reform for a lot of people out there working every day but are one illness away from bankruptcy," adding, "I don't think that's unreasonable. I don't think that's socialism. I think that's a realization that we're all in this together" (Washington Post, 3/19).

Obama also defended his strategy to address health care and other major issues at the same time. He said, "I know some folks in Washington and on Wall Street are saying we should focus on only one problem at a time: 'our problem.' But that's just not the way it works. You don't get to choose between paying your mortgage bills or your medical bills" (Babington, AP/Kansas City Star, 3/18).

Orszag Defends Budget Proposal
White House Office of Management and Budget Director Peter Orszag on Tuesday during a lunch at the Christian Science Monitor defended the Obama budget proposal, the Monitor reports. Orszag said, "The risks of not acting are substantial," adding, "We may be sowing the seeds of future crises if we don't address these widely known and broad societal problems," such as health care. As Congress prepares to begin debate, Orszag said that he is "confident that we'll get a budget resolution that reflects" the priorities of the Obama proposal.

According to Orszag, health care costs represent the largest long-term fiscal problem that the U.S. faces. In the event that health care costs continue to increase at the current rate, Medicare and Medicaid will account for 20% of gross domestic product by 2050, he said. Orszag cited the need to promote health care information technology, comparative effectiveness research, modernization of the Medicare and Medicaid reimbursement systems, and preventive care and wellness programs to help limit increases in health care costs. Orszag said, "The single most important thing we can do to put the nation on a sounder long-term fiscal footing is to reduce the rate of growth of health care costs. Period" (Grier, Christian Science Monitor, 3/19).

CBO To Release Budget Deficit Estimates
The Congressional Budget Office on Friday plans to release new budget deficit estimates that will exceed those included in the Obama budget proposal, Politico reports. According to Politico, the White House "is being warned to expect a grim set of deficit projections, adding well over $1 trillion on top of the red ink already conceded" in the Obama proposal. CBO will estimate a budget deficit of more than $700 billion in 2014, compared with $570 billion estimated in the Obama proposal, and a deficit of more than $1 trillion in 2019, compared with $712 billion in the Obama proposal, Politico reports.

Use of Budget Reconciliation Process Discussed
House Democrats on Wednesday evening met with Obama administration aides to discuss the process that they will use to pass the budget and health care reform and other legislation, Politico reports. After the meeting, House Speaker Nancy Pelosi (D-Calif.) said that the House might use the budget reconciliation process, which allows legislation to move through the Senate without the threat of a filibuster, to pass health care reform legislation. She said, "We just want to get a budget passed and we want to get health care passed. Whatever the path is to do that is fine" (Rogers [1], Politico, 3/18).

Senate Budget Committee Chair Kent Conrad (D-N.D.) on Tuesday said that, although he seeks to help Obama pass health care reform legislation, his budget proposal requires significant "adjustments." In addition, Conrad said that he will oppose efforts to use the budget reconciliation process to pass health care reform legislation (Rogers [2], Politico, 3/18).

House Republicans on Health Care
House Republicans have begun efforts to "develop new policy ideas, anoint new political and intellectual leaders and rebuild a brain trust to lead it back to power" on health care, CQ Today reports. On the issue of health care, House Republicans "have lost key members to retirement and electoral defeat," and many of "their ideas -- such as price transparency or high-deductible health plans -- were rejected in the market," according to CQ Today.

In February, former House Minority Whip Roy Blunt (R-Mo.) formed a House Republican health care task force, which has begun to assemble experts to provide members with the knowledge needed to debate Democrats on the issue. Blunt said, "One of the goals of our working group ... is also to get our members in this discussion, both in Washington and in their districts," adding, "If we could get the same kind of engagement on health care from our conference that we got on energy last year, that in and of itself would be a great success."

Rep. Charles Boustany (R-La.), a member of the task force, said, "I think there's a willingness on the part of leadership now to recognize that we have to address it."

In addition, the House Republican Conference has established Health Care Boot Camp, a weekly education series for aides led by experts from the Congressional Research Service and former congressional and administration staff members with expertise in health policy (Armstrong, CQ Today, 3/18).

Medicare Rx Drug Benefit
Advocates for expansion of the Medicare prescription drug benefit have begun "scaling back their expectations" this year, as Democrats plan to focus on broader health care reform legislation, The Hill reports. According to The Hill, the "Holy Grail for liberals and seniors' advocates since the creation of the Medicare Part D drug benefit in 2003 has been closing off a gap in coverage, called the 'doughnut hole,'" but "with President Obama and his allies in Congress poised to spend at least $634 billion -- and possibly more than $1 trillion -- the costly priority of eliminating that doughnut hole may be out of reach." The Obama budget proposal did not address reforms to the Medicare prescription drug benefit, and OMB "has indicated that the forthcoming full budget will not spell out details on what the Obama administration wants to see on Part D," all of which "has some wondering where Medicare fits into the larger debate on health reform," according to The Hill (Young, The Hill, 3/18).

Broadcast Coverage
KCRW's "To The Point" on Thursday examined whether the $19 billion included in the economic stimulus package for health care information technology will help reduce the cost of health care, increase efficiency and eliminate medical errors (Olney, "To The Point," KCRW, 3/19).

Reprinted with kind permission from kaisernetwork. You can view the entire Kaiser Daily Health Policy Report, search the archives, or sign up for email delivery at kaisernetwork/dailyreports/healthpolicy. The Kaiser Daily Health Policy Report is published for kaisernetwork, a free service of The Henry J. Kaiser Family Foundation.

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