WASHINGTON President Barack Obama named Kansas Governor Kathleen Sebelius on Monday to lead his ambitious health reform effort, kicking off a week focused on revamping an inefficient healthcare system whose cost he fears is hurting the U.S. economy.
Obama also named former Clinton administration health official Nancy-Ann DeParle to serve as head of the newly created White House Office for Health Reform, which will help coordinate Obama's health reform agenda with Congress.
"If we are going to help families, save businesses and improve the long-term economic health of our nation, we must realize that fixing what is wrong with our healthcare system is no longer just a moral imperative, but a fiscal imperative," Obama said in announcing the appointments.
Sebelius, a former state insurance commissioner, is noted for trying to bridge the political divide as a Democratic governor in a Republican state -- a skill she will need to tackle one of the most ambitious undertakings of the new administration.
"We can't fix the economy without fixing healthcare," Sebelius said at a White House event announcing the appointments. "This isn't a partisan challenge. It's an American challenge and one that we can't afford to ignore."
DeParle handled budget matters for federal healthcare programs during President Bill Clinton's administration as well as the job of managing the Medicare and Medicaid health programs for retirees and the poor, which could be building blocks for a new system.
The appointments were largely welcomed by the healthcare industry. But critics took aim at both the larger role seen for government and Sebelius' record of supporting abortion rights.
Obama's healthcare push was stymied when his first nominee for the cabinet health job, former Senate Democratic leader Tom Daschle, withdrew after admitting he had paid $140,000 in back taxes and fines after being tapped for the post.
EXPANDING HEALTHCARE COVERAGE
Obama has set goals of expanding healthcare to 46 million uninsured Americas, easing the burdens of insurance costs to employers by paying for it with new taxes, and streamlining operations of the medical system.
The president on Monday announced the release of $155 million to support 126 new community health centers, which will help the uninsured access medical care. The funding was part of the stimulus bill passed by Congress last month.
The White House will host a healthcare summit on Thursday, with sessions among health insurers, lawmakers and lobbyists for groups ranging from the drug industry to employers. While the guest list has not been published yet, officials have indicated a broad range of expertise will be represented.
There is wide agreement the U.S. healthcare system needs change, and some unusual alliances have arisen -- with retail giant Walmart, which has been criticized for the level of insurance offered to employees, joining a coalition with labor unions.
Drug companies also support reform but not at the cost of sharply lower prices.
But Obama is getting a backlash from Republicans, who worry about his plan to move the agenda sharply to the left and nudge healthcare out of the control of various private interests.
"The era of big government is back," House Republican Leader John Boehner said last week after Obama released his new budget proposal, which put an emphasis on healthcare reform.
Obama has said he favors working to reform the current system with its many institutions rather than trying to build a "single-payer" system along the lines of Medicare that might eliminate insurers and other participants.
But the president has also said he would opt for a "single-payer" system if he were designing it from scratch.
Most of his own power would lie in using Medicare as a catalyst, either by expanding the giant federal health insurance plan for the elderly and disabled, or by making changes that private insurers would be likely to follow.
Obama's budget last week highlighted a $634 billion "reserve fund" to pay for 10 years of changes in healthcare, ranging from new computer-based initiatives to a program to send nurses to the homes of new mothers.
(Additional reporting by Caren Bohan, writing by Maggie Fox, editing by Philip Barbara)