Health: Financing Health-Care Reform

by Lesley Politi on March 25, 2009

Health: Financing Health-Care Reform

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The Obama blueprint targets new spending on a variety of health initiatives, and seeks a $630 billion reserve fund over 10 years to finance a health-care overhaul effort. The reserve would be funded through Medicare savings and tax increases.

 The Obama plan targets enforcement, proposing to spend $311 million more next year and a total of $1.7 billion by 2014 to reduce fraud and abuses in Medicare, the federal insurance program for the elderly, and Medicaid, the federal-state program for the poor.

In total, Health and Human Services would get $76.8 billion, excluding mandatory spending on Medicare and Medicaid, down from the $78.4 billion projected spending in the current year.

The National Institutes of Health would get $6 billion for cancer research in the fiscal year beginning Oct. 1, on top of the $10 billion already allocated by the stimulus package for research in the current fiscal year and in 2010.

The administration also wants an additional $4.5 billion to expand programs in child care and development, such as the Head Start program for disadvantaged preschool children and their families. In addition, it wants to set up a program of home visits by nurses to low-income pregnant women and first-time mothers.

In an effort to reduce chronic diseases, a high-cost area in health care, the administration proposed to spend $1 billion expanding community-based programs aimed at preventing disease and encouraging healthy behavior.

The blueprint also estimates that seven million Americans who lost their jobs will be eligible for a federal subsidy of as much as 65% to help pay Cobra premiums so they can keep work-based insurance. Recently passed legislation also expanded the federal-state Children’s Health Insurance Program, and the stimulus package included $19 billion to computerize the nation’s health records.

The continuing salmonella outbreak involving peanuts caught President Barack Obama’s attention earlier this year. Now, his new budget includes $1 billion more for the Food and Drug Administration’s food safety oversight.

The administration hopes to reduce the number and duration of outbreaks of food-borne illnesses by targeting $1 billion more for the FDA, which regulates most nonmeat items. Among other things, the money would be used to step up inspections of food facilities.

The Department of Agriculture, which regulates meat, poultry and eggs, would also get additional funds to improve the detection and reduce the incidence of food-borne illnesses. The administration’s blueprint also promised to more steps to ensure products are “wholesome, and accurately labeled and packaged.”

In addition, the budget plan includes an increase of more than $1 billion a year to improve school lunches and other nutrition programs for children and low-income pregnant women. It also includes more funding to improve the National Organic Program, which certifies organic food.


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