President Obama authored a letter to Sens. Ted Kennedy (D-Mass.) and Max Baucus (D-Mont.) stating he will look to make $200 to $300 billion in Medicaid and Medicare cuts over the next 10 years.
However, savings will come via investment in new technology (think the electronic health record, or EHR, incentive program) and fixing different costs of care (more money for primary care), he says. But savings will also be realized by "going after" rising costs as the result of unmanaged chronic diseases, duplicated tests and unnecessary hospital readmissions, Obama says.
"In short, the status quo is broken, and pouring money into a broken system only perpetuates its inefficiencies," the president wrote. "Doing nothing would only put our entire health care system at risk. Without meaningful reform, one fifth of our economy is projected to be tied up in our health care system in 10 years; millions more Americans are expected to go without insurance; and outside of what they are receiving for health care, workers are projected to see their take-home pay actually fall over time."