Obama provides details on health-care overhaul

WASHINGTON — President Barack Obama, providing the first real details on how he wants to reshape the nation's health-care system, urged Congress on Wednesday toward a sweeping overhaul that would allow Americans to buy into a government insurance plan.

In a letter to two senators leading the health-care debate, Obama also moved toward accepting a requirement for every American to buy health insurance, as long as the plan provides a "hardship waiver" to exempt poor people from having to pay.

Obama opposed such an individual mandate during his campaign, but Congress increasingly is moving to embrace the idea.

Obama set out the goals in a letter to Sens. Edward Kennedy, D-Mass., and Max Baucus, D-Mont., chairmen of the two committees writing health care bills. It followed a meeting he held Tuesday with members of their committees, and amounted to a road map to keep Congress aligned with his goals.

"The plans you are discussing embody my core belief that Americans should have better choices for health insurance, building on the principle that if they like the coverage they have now, they can keep it, while seeing their costs lowered as our reforms take hold," Obama wrote.

Obama has asked the House and Senate each to finish legislation by early August, so that the two chambers can combine their bills in time for him to sign a single, sweeping measure in October. In a statement Baucus welcomed the assignment.

"I will stop at nothing to deliver a health reform bill that works for families and businesses to the president this year," Baucus said.

Covering 50 million uninsured Americans could cost as much as $1.5 trillion over a decade, and cost is emerging as a major sticking point. Obama didn't offer new solutions to that problem in his letter Wednesday but did say he'd like to squeeze an additional $200 billion to $300 billion over 10 years from the Medicare and Medicaid government insurance programs for the elderly, disabled and poor.

He said he'd do it through such measures as better managing chronic diseases and avoiding unnecessary tests and hospital readmissions. Savings from such measures are uncertain.

Medicare benefits cost the federal government about $450 billion a year and Medicaid about $200 billion. Obama already has targeted the programs for some $300 billion in cuts over 10 years in the 2010 budget he released in February.