Health bill alone won't stem costs: White House

WASHINGTON (Reuters) - Healthcare reforms working their way through the U.S. Congress will help slow rising medical costs but more will have to be done in coming years, a top Obama administration official said on Wednesday.

White House budget director Peter Orszag said proposals by Democratic lawmakers could still use "further tweaking" to strengthen them and further reduce the cost of U.S. healthcare, but he declined to mention specifics.

President Barack Obama's drive for healthcare overhaul, his chief domestic policy goal, has aimed to both increase access to care for Americans and halt the rapid growth in the $2.4 trillion industry.

Healthcare costs now make up 16 percent of the U.S. economy and are forecast to reach 20 percent by 2017.

Orszag said other actions outside of Congress would still be needed to improve how medical care is delivered, including the Senate's proposed independent commission to oversee parts of Medicare, a government "entitlement" program that provides health insurance for the elderly and disabled.

"It would not be practical to get those kinds of provisions into just an entitlement reform bill," he told reporters at the National Press Club.

His comments come as senators launched a contentious debate over Democrats' $849 billion proposal to expand access to medical insurance by saving money elsewhere in the nation's $2.5 trillion healthcare sector.

The House of Representatives has already passed its $1 trillion measure, which must be combined with whatever the Senate passes before Obama can sign it into law.

CRITICS DECRY REFORM COSTS

Orszag noted that the nonpartisan Congressional Budget Office estimated the bills will help reduce the government's deficit. The Senate's measure would close the gap by $127 billion in the next decade and another $650 billion 10 years after that, the CBO has said.

Republicans and other critics have said the proposals cost too much and that savings forecast by the CBO either are not realistic or could evaporate over time.

Orszag did not say what additional steps Obama might take in his next budget proposal in February to deal with healthcare. But he did say healthcare reform alone will not bring down the U.S. deficit -- now at $1.4 trillion.

"Fiscally responsible health reform is necessary but not sufficient to address our immediate-term deficit and long-term deficit problem, and there is more that will be necessary," Orszag said. "We'll be talking more about that next year."

Even more crucial to the bill's success is how well any final law is put into place, Orszag said.

"A huge amount will depend on how this is executed and implemented, and a lot of attention will have to be paid in the next few years to getting this done right," he said.

The U.S. Centers for Medicare and Medicaid Services will likely carry out much of the legislation. It is the only U.S. health agency in which Obama has not appointed a director.

Asked whether the agency has the staff and funding to do so, Orszag said the administration is focused on ensuring there are sufficient resources to carry out the task.

(Editing by Sandra Maler)