Editorial: Opening moves on health care

It's easy to see why health-care reform is so hard.

Despite getting financial concessions from the hospital and pharmaceutical industries, the Obama administration spent much of last week trying to smooth over the discord within Democratic ranks and other key constituencies.

The dissension showed that lawmakers in Washington still have a way to go before the United States joins most other industrialized nations in guaranteeing health care for all citizens.

Two big sticking points remain: the need to rein in growing health-care costs, and how best to finance coverage for the nearly 50 million uninsured.

President Obama announced one concession last week, that hospitals will forgo $155 billion in Medicare and Medicaid payments. That gets Obama closer to paying for the reform's estimated $1 trillion tab over a decade.

The earlier drugmaker agreement offered up an additional $80 billion to improve drug coverage for retirees as well as pay expected new prescription costs when coverage is expanded.

Both deals are steps in the right direction in the effort to tamp down medical costs. But that requires lots of trust the deals will be honored and won't cost more than they save.

It won't surprise many that the drugmakers and hospital executives - far from merely capitulating to White House cost-cutting demands - also came away with commitments they each wanted.

Drugmakers were looking for price guarantees for medicines they provide Medicare recipients, and hospitals were assured that any reduction in reimbursements would come only after more of the uninsured were covered. Physicians, who pledged to slow spending by 1.5 percent, are said to have their own wish list.

If the price tag for those items cancels the savings, the remaining value of these agreements will be that they kept key stakeholders at the negotiating table.

That still leaves Congress and the White House grappling with how to pay for expanded coverage and further reduce costs.

A group of 40 fiscally conservative Democratic House members, known as the Blue Dog Coalition, demanded changes in the legislation aimed at attacking costs.

Other Democrats want the government to sell insurance that would compete with private companies - a move most of the Republicans oppose. One positive sign was the growing consensus against taxing employee health benefits.

There are scores of other moving parts in the legislation, creating lucrative work for an army of lobbyists and making for many potential devils in the details.

At week's end, some in Congress urged more time to work on the legislation. That's fine, as long as the deliberations don't turn into procrastination. And the two key issues of how to cut costs and pay for universal health care must get resolved in a fair way.