Obama laying the groundwork for U.S. health reform

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By Donna Smith

WASHINGTON (Reuters) - President-elect Barack Obama has begun laying the groundwork for overhauling the troubled U.S. healthcare system, reaching out to interest groups and building grassroots support for the huge undertaking.

Obama, who takes office on January 20, is using many of the Internet tools employed in his election campaign to engage the public. His Internet site www.change.gov asks people to submit ideas for changing the costly and inefficient system that leaves tens of millions uninsured.

"Every American is feeling the pressure of high health costs and lack of quality care, and we feel it's important to engage them in the process of reform," said Obama transition team spokeswoman Stephanie Cutter.

"Change starts from the ground up, and we believe that's true on critical issues like healthcare reform as well."

Obama's coordinator on healthcare, former Senate Majority Leader Tom Daschle, will participate in a healthcare reform debate in Colorado on Friday that is expected to begin detailing the plans for change.

Daschle was expected to announce plans for a series of "community conversations" to listen to Americans' experiences with the healthcare system, according to an industry source.

During the campaign, Obama pledged to bring health insurance to millions of uninsured Americans and spend about $50 billion to make U.S. health records electronic.

Many health reform advocates believe Obama will need broad public support to overhaul an industry that has become among the most intractable of U.S. political problems.

Voters put healthcare reform as their third biggest concern after the economy and the Iraq war. Finding the money and ingenuity to fix the system will be difficult.

The United States now spends more on healthcare than any other developed nation, yet has some 47 million people without health insurance. Most insured people receive coverage through their employers but businesses complain that exploding costs threaten their competitiveness in a global market.

High worker healthcare costs have been cited as a major reason why U.S. automakers, which are seeking $34 billion from the federal government, are in such trouble.

U.S. healthcare costs now account for about 16 percent of U.S. gross domestic product -- or $2.3 trillion -- a proportion projected to grow to 20 percent or $4 trillion by 2015.

UNSUSTAINABLE SYSTEM

John Castellani, president of the Business Roundtable, part of a health reform coalition that includes the AARP, an advocacy group for older Americans, and the Service Employees International Union, said maintaining the status quo was not an option.

"The current system and its costs and inefficiencies is really unsustainable," he said.

Daschle, the former South Dakota Democratic senator who is expected to be tapped by Obama to be health and human services secretary, has been in talks with consumer, business, labour and health industry groups that have a stake in reform.

"I think this is going to be a very cooperative endeavour that will involve both the president and (nominated) Secretary Daschle and the Congress," said Ron Pollack, executive director of Families USA, a healthcare reform advocacy group.

"Obama and Tom Daschle are going to work very closely with the Congress in developing a proposal," he added.

Obama will be able to lean on the grass-roots networks of groups that supported him during the election campaign, such as the Service Employees International Union, which represents more than a million healthcare workers.

Any reform has its winners and losers and while there is broad agreement the current system is unsustainable, many competing groups -- consumers, labour unions, pharmaceutical companies, insurers and health professionals -- will be pushing to protect their interests. (Additional reporting by Caren Bohan; Editing by Doina Chiacu)

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