Healthcare reform gets backing in Congress

WASHINGTON (Reuters) - Efforts to reform the U.S. healthcare system got a big boost on Wednesday as a powerful Democratic senator unveiled a plan similar to President-elect Barack Obama's and an analysis said the financial crisis could accelerate any efforts, not hinder them.

Max Baucus, a Montana Democrat who heads the U.S. Senate Finance Committee, proposed creating a national insurance exchange, similar to Obama's idea, through which millions of uninsured Americans and businesses could get health coverage.

But Baucus would eventually require everyone to have health insurance while Obama proposes making health coverage more affordable but not mandatory. But both plans would be expensive and come amid financial turmoil.

Both major parties, Congress, consumer groups and employers agree the U.S. healthcare system is in shambles and needs reworking. Obama will have to work with Congress to make any significant changes.

Nearly 46 million Americans have no health insurance and while Americans pay more per capita for healthcare than citizens of any other industrialized country, many studies show they have poorer health, suffer more medical mistakes and are in general unhappier with what they do get.

Consultants PriceWaterhouseCoopers released a report on Wednesday that said the Obama plan would cost the federal government $75 billion the first year but would provide health insurance for 95 percent of Americans.

This would grow to $130 billion a year by 2018.

Dr. David Levy, health industry specialist at the consulting firm, said the financial crisis could make waste unacceptable and speed healthcare reform. "Maybe this crisis has helped unleash more market forces to drive this system toward more value for patients," Levy told a telephone briefing.

"The financial crisis and culminating market forces could accelerate health reform, not be a roadblock," the report reads.

The effects could be enormous for the $2.3 trillion healthcare industry, which accounts for about 16 percent of the U.S. economy.

QUICK BACKING

Congress has been waiting for years to enact healthcare reform, and a quick and enthusiastic response to Baucus's plan suggests considerable backing.

"He has rightly sounded the urgent plea to get comprehensive reform done early in the next Congress and recognizes that the failure to act has dire and unacceptable consequences for working families, businesses and our national economy," AFL-CIO President John Sweeney said in a statement.

"There has never been a more auspicious opportunity to secure meaningful health care reform: The President-Elect has made it a top priority; key congressional committee chairs have made it their top priority; and the large and diverse health care interest groups are working cooperatively to find common ground," Ron Pollack of Families USA, a liberal-leaning health reform advocacy group, said in a statement.

Massachusetts Sen. Edward Kennedy, a senior Democrat and a life-long supporter of expanded healthcare access, has said he wants lawmakers united behind one bill.

Baucus, who as head of the tax-writing Finance Committee will play a major role, said he plans to work closely with Obama, who takes office on January 20, Kennedy and other lawmakers.

But Iowa Republican Sen. Chuck Grassley, ranking member of the Committee on Finance, said any reform would be hampered by the budget deficit.

"Right now, we already have a deficit of at least $400 billion before the $700 billion bailout and the economic downturn being factored in," Grassley said in a statement.

"We're heading toward a deficit that's 10 percent of the economy. So, paying for health care reform needs to be done in an intellectually honest way for the fiscal health of our country, and the broader the support for any health policy changes, the more durable and effective they will be."

(Editing by Eric Beech)