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Letter to Obama on Health Care Reform

Henry J. Aaron

The White House recently released a letter sent to President Obama by a group of more than twenty economists, including two Nobel laureates and five former presidents of the American Economic Association, urging that health reform should include four key measures to rein in health care spending and promote fiscal responsibility.

Those principles are as follows:

  • Health reform should be paid for in full, through increased efficiencies, specific spending cuts, or tax increases, so that it does not increase the federal budget deficit;
  • An excise tax should be imposed on high-cost health insurance plans in order to discourage the provision of plans that tend to drive up total health care spending;
  • A commission should identify ways of slowing the growth of Medicare spending in order to deal with long-term imbalances between revenues and outlays that must eventually be addressed; these measures should be designed in ways that do not harm beneficiaries; and
  • Legislation should create incentives to promote efficiency-promoting reforms in the health care delivery system by encouraging coordination of care, supporting research on what services work best, and discouraging errors that lead to needless hospital readmissions.

I (along with fellow Brookings economist, Alice Rivlin) joined that group of signatories, in our personal capacities, out of a belief that health system reform is urgently important but must be fiscally responsible and should improve the quality of care. Careful study indicates that well-designed reforms can achieve both objectives. Legislative proposals now being considered in Congress differ. The signers of the letter to the president did not take a stand on which of these proposals is best but rather expressed support for specific measure that any legislation should embody. 

Click here for the full statement and a complete list of signers »

 

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