Health care was the defining political battle of President Barack Obama's first term, and — after the economy— it remains his most complicated policy challenge at home, central to his place in history.
Fixing the system is a tall order as "Obamacare's" major coverage expansion takes effect this year and next. The U.S. is projected to spend $2.9 trillion on health care in 2013, approaching one of every five dollars in the economy, much more than any other advanced country. But Americans are not appreciably healthier and more than 48 million are uninsured. The nation's mix of private insurance and government programs supports many of the world's best hospitals, but overall the quality of care is uneven and much is wasted by lack of coordination and overtreatment, putting patients at risk. Fraud bleeds the system of tens of billions of dollars a year.
The campaign promise:
Obama said he would cover most of the uninsured, preserve Medicare and Medicaid benefits, deny insurance companies the ability to turn away the sick, improve quality, get tougher and smarter against fraud and bring medical records into the Internet age — all while keeping cost increases manageable for government and employers, and premiums affordable for families and individuals. And he promised that for those without coverage, "starting in 2014 this law will offer you an array of quality, affordable, private health insurance plans to choose from" (June 28, 2012).
Against the odds, an unlikely combination of circumstances has put Obama within reach of his goals, despite enduring opposition from Republicans. But his administration may yet stumble. The rollout of his health care law, and whether the president can prevent major Medicare and Medicaid cuts in the budget battle, could help or hurt Democrats running in the 2014 congressional elections.
The Supreme Court handed Obama a big victory by upholding the Affordable Care Act, with its unpopular individual requirement to carry insurance. Another big break has come from an unusual and perhaps fleeting lull in health care inflation. That's taken away some of the pressure for sweeping changes in Medicare, such as privatization. It's also providing economic breathing room to cover the uninsured.
Even so, some of the Medicare cuts Obama is willing to enact would hit beneficiaries. Well-to-do seniors and growing numbers of upper middle-class retirees could face higher monthly premiums, triggering a political backlash.
Yet most of the risk for Obama comes from the advance of his health care law. Already a provision extending coverage for young adults on their parents' policies has reduced the number of uninsured. But can the administration deliver his promise of affordable, quality coverage for millions more uninsured Americans without a cost spike that undermines benefits for others?
Costs will go up, not down, contrary to what Obama promised in his first term. But how fast? If health care inflation remains at low or moderate levels, there should be room to bring in the uninsured.
Open enrollment in new insurance markets under the law starts Oct. 1 for coverage that's effective Jan. 1. But Obamacare faces political hostility in about half the states. Don't count on many Republican governors to help sign people up.
President Lyndon Johnson signed the Medicare law on July 30, 1965, and 11 months later seniors had coverage.
Obama signed the Affordable Care Act on March 23, 2010. Three years later, Americans still don't know how it will work — or how affordable their care will be. A clear picture may take a few more years. Obama's name will be forever linked to it.