Healthcare Reform. President-Elect Obama’s Proposal

The U.S. healthcare is one of the major economy sectors of the American economy, in which large resources are concentrated. The government’s activities in the healthcare sphere have a multisided influence on the American society. The politics in the healthcare sphere affects substantial interests of almost every layer, group, and classes in the society, and remains in the centre of the county’s political life. The system of private medicine, also exists within the limits of the state’s legislation, which define the stimulus and the direction of its development, and maintain a governmental control. The tax policies sufficiently stimulate the formation of a private medical insurance system. Despite the apparently established system of the healthcare system, the subject of its reform is among the most discussed in the media, specifically within campaigns and prior to the election. Each reform proposal provides certain initiatives their own advantages and disadvantages. In the light of the aforementioned, this paper analyzes a selected healthcare reform proposal which was introduced by the President Barack Obama during his presidential campaign.


Healthcare reform proposed by Barack Obama is based on eight main principles, which were outlined in FY 2010 budget overview. The principles can be summarized as reducing costs and covering all layers of the population. Specifically, the president emphasized the position on health coverage that concerns protecting families from bankruptcy, maintaining the coverage when changing or losing a job, and eliminating the barriers for coverage for people with pre-existing medical conditions.

In terms of subsidies, the reform, in addition to bankruptcy protection, refers to The American Recovery and Reinvestment Act, which would make “[the] coverage more affordable for Americans, who lose their jobs and their access to employer-based health coverage by offering a subsidy of 65 percent of the premium costs for COBRA coverage.” (“Focus on Health Reform,” 2009) Regarding the subsidies for employers, the reform proposes providing small businesses with a refundable tax credit of up to 50 percent, as well as providing federal subsidies to partially compensate employers’ costs. (“President-Elect Barack Obama’s Health Care Reform Proposal,” 2008)

There was not any specific tax reform related to healthcare, while there changes related to the insurance system. The main changes to the insurance policies imply cretin insurance pooling mechanism, which will provide individuals more flexible options on which plan to choose. In terms of prices, the proposal outlines terms such as “reasonable share”, “fair and stable premium” and “generous coverage”, which in turn imply a sort of control preventing monopoly of insurers. (“President-Elect Barack Obama’s Health Care Reform Proposal,” 2008) The reform main goal is to cover 37 million U.S. citizens over the period of ten years. (“House Democrats Unveil Health Care Reform Proposal,” 2009)

Financial Aspects

The financial aspect of the reform is twofold, where, on the one hand, the costs implied during the presidential campaign included numbers between $50 and $65 billion a year when the reform is executed. On the other hand, when the reform bill was unveiled in July 15, 2009,the estimation was raised to $1 trillion over the period of ten years. It is expected that the reform will be financed from savings within the health system, and a new surtax on higher-income population. In that regard, problems of funding might arise due to the high estimated sum of $1 trillion. However, it is feared that the estimations might be actually higher than they are, with the costs being reduced due to Medicare and Medicaid savings. (“Obama Battles Cynicism Over Health Care Reform, Says Plan Will Be ‘Fully Paid For’,” 2009) Thus, it might be assumed that other reforms related to the financial aspect might be needed through the process of the implementation.

Recommendations and Conclusion

The health reform proposed by Barack Obama can be seen as a transitional stage for another reform. In that regard, the step toward a full funding by the government of the public health care can be seen missed in this reform. Nevertheless, various forms of assistance can be seen helpful in terms of their subsidies options. Another approach in the government control of private health insurance companies, will definitely contribute to the affordability of the insurance packages.

Accordingly, it might be recommended that the differentiation of the population with different incomes should imply several more divisions, where the difference in incomes should be more flexible and gradual. Additionally, even with the reductions in costs for particular layers of the population, the healthcare system remains among the most expensive in the world. The reforms should cover such aspects as the costs of drugs, not only for the elderly, but for the general population. Thus, initiatives similar to the proposed in the insurance sector should be applied on pharmaceutical companies to eliminate a monopoly and high prices.

It can be concluded that there will not be a perfect plan, as there will always be categories of population that will be dissatisfied with the changes. Nevertheless, the proposed reform has many original ideas that seem to be on the right track toward the ultimate goal in the health care system, which is free public medicine.


Focus on Health Reform. (2009). The Henry J. Kaiser Family Foundation. Web.

House Democrats Unveil Health Care Reform Proposal. (2009). Medical News Today. Web.

Obama Battles Cynicism Over Health Care Reform, Says Plan Will Be ‘Fully Paid For’. (2009). FoxNews. Web.

President-Elect Barack Obama’s Health Care Reform Proposal. (2008). The Henry J. Kaiser Family Foundation. Web.

Find out the price of your paper