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White House report says fixing health care good for economy… Ya think? — MedCity morning read, June 2, 2009

June 2, 2009 7:07 am by | 0 Comments

Christine Romer, chair of the Council for Economic Advisers

Christine Romer, chair of the Council for Economic Advisers, meets in January with Pres. Obama and Vice President Biden.

WASHINGTON, D.C. — Fixing the economy means fixing the nation’s health care system (pdf), according to a report by the White House Council of Economic Advisers.

The report is just what the Obama administration needs to sell Americans on a sweeping social welfare program during a recession, according to an Associated Press story published in the Washington Examiner.

The president’s economic advisers say we’re headed for disaster unless we slow the growth rate of health care costs. But if we slow this rate by just 1.5 percentage points per year, we could increase output (gross domestic product) by more than 2 percent in 2020 and nearly 8 percent in 2030.

This slowing of cost growth would result in $2,600 more in income in 2020 and almost $10,000 more in 2030 for a family of four, the council said. It could “prevent disastrous increases in the federal budget deficit.” And it could lower the unemployment rate “by approximately one-quarter of a percentage point for a number of years,” according to the council’s report.

In addition, extending health care insurance to the uninsured “would increase net economic well-being by roughly $100 billion a year, which is roughly two-thirds of a percent of GDP.

Reform also likely would increase the labor supply, remove barriers to moving from job to job, and help level the playing field between big and small businesses, the report said.

Critics were quick to dismiss the report, the AP said.

“Everyone agrees that reducing the cost of health care would benefit our economy, but the administration hasn’t offered a credible plan to do so without raising taxes or rationing care,” said House Minority Leader John Boehner, an Ohio Republican.

More stories worth a read:

[White House photo by Pete Souza]

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Mary Vanac

By Mary Vanac

Mary Vanac is a co-founder of MedCity News.
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