White House: Health Care is Economic Problem

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WASHINGTON - Fixing the economy requires overhauling the U.S. health care system, a White House report concludes - just the message the administration needs to help implement a sweeping new social welfare program during a recession.

The report by the White House Council of Economic Advisers says that health care costs - now about 18 percent of the gross domestic product - will rise to 34 percent in 30 years if left unchecked, wreaking havoc on the federal deficit, businesses and working Americans.

Obama administration officials, urgently seeking to build momentum for health care legislation, planned to discuss the report's findings at the White House on Tuesday with leaders of the key Senate committees drafting bills.

"Health care reform is incredibly important not just for the American people but for the American economy," said Christina Romer, chairwoman of the Council of Economic Advisers. "Good health care reform is essentially good economic policy."

Critics were quick to dismiss the report.

"Everyone agrees that reducing the cost of health care would benefit our economy, but the administration hasn't offered a credible plan to do so without raising taxes or rationing care," said House Minority Leader John Boehner, R-Ohio.

President Barack Obama and his advisers have consistently sought to link health care and the economy but they're turning up the volume as Congress returns from a weeklong recess and turns its attention to health care.

Later Tuesday, Obama was set to meet at the White House with Senate Democratic leaders to "discuss the urgent need to get rising health care costs under control," according to a White House advisory.

On Monday, a coalition of industry groups submitted proposals to the White House they said would reduce the growth of their own costs by 1.5 percent a year, consistent with Obama's goals.

Obama wants legislation that would hold down costs, guarantee choice and extend coverage to the 50 million Americans who don't have it now.

Two Senate committees are crafting legislation: the Health, Education, Labor and Pensions Committee led by Sen. Edward M. Kennedy, D-Mass., and the Senate Finance Committee, chaired by Sen. Max Baucus, D-Mont.

The Democrats on Kennedy's committee were meeting Tuesday for a first look at an outline of Kennedy's plans. It wasn't clear if Kennedy, who has been diagnosed with brain cancer, would be present.

Neither committee has released a full bill yet. Both have circulated proposals and differences have emerged, leading Kennedy and Baucus to issue a joint statement over the weekend promising to work together.

Majority Democrats in the House and the Senate want to bring the legislation to the floor by August.

© 2009 The Associated Press. All rights reserved.

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