Obama Says Health Industry Promises Reduction in Prices

WASHINGTON (CN) - Health care reform will be achieved by the end of the year, President Barack Obama promised Monday after receiving a promise to reduce costs from doctors, unions and health insurers. "We're spending more on health care than any other nation on Earth, and nearly 46 million Americans don't have any health insurance at all," he said.

Obama told the story of when his mom died of cancer. Even on hear death-bed, he said, she had to worry about whether her health insurance would pay her medical bills. "That's why health care reform is a key priority to this presidency," he said, "that's why I will not rest until the dream of health care reform is finally achieved in the United States of America."

But President Grace-Marie Turner of the Galen Institute, a think tank which believes in a market-based approach to health-care reform, thought Obama was too optimistic.

"It doesn't seem to me that either the White House or the associations have any of the levers of power they will need to follow through on their promises," she said.

The cost of care is rising four times faster than wages, Obama noted in a widely anticipated speech, and half of all personal bankruptcies are the result of medical expenses. It's predicted that by the end of the decade we will spend an amount equal to a fifth of our total economy on healthcare, Obama added.

He cited the current system where businesses pay health insurance as a burden on American companies who compete internationally.

Obama also addressed the exploding cost of Medicaid and Medicare, and said it "has put our federal budget on a disastrous path."

But at the meeting, health care providers, unions and doctors committed to cutting the growth of costs by more than $20 trillion over the next decade.

To help people who have lost their jobs, the government is providing a subsidy to 7 million unemployed Americans and medical records are being computerized to reduce administrative costs and improve privacy, touted Obama.

Reform must bring down health care costs and leave patients with a choice of which doctors to visit, a "reform that we can, must, and will achieve by the end of this year," said Obama.

But Turner with the Galen Institute said the plan to cut costs by 1.5 percent a year was too vague. "It raises as many questions as it answers," she said. "What are they specifically going to do to get costs down by 1.5 percent a year? Those kinds of details were not evident to me."

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