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  Date / Time: 8/9/2009 6:07 AM UTC

  Obama Offers Universal Health Care Plan
  

  Democratic presidential hopeful Barack Obama on Tuesday offered a plan to provide health care to millions of Americans and more affordable medical insurance, financed by tax increases on the wealthy.

  Bemoaning a health care "cost crisis," Obama said it was unacceptable that 47 million are uninsured while others are struggling to pay their medical bills. He said the time is ripe for reforming the health care system despite an inability to do so in the past, most notably when rival Hillary Rodham Clinton pursued major changes during her husband's presidency.

  "We can do this," Obama said in a speech in Iowa City at the University of Iowa's medical school. "The climate is far different than it was the last time we tried this in the early nineties."

  Obama's plan retains the private insurance system but injects additional money to pay for expanding coverage. Those who can't afford coverage would get a subsidy on a sliding scale depending on their income, and virtually all businesses would have to share in the cost of coverage for their workers.

  Obama didn't mention how much his plan would cost and the campaign refused to provide a total figure. A memo written by three outside experts and distributed by the campaign after his speech said the plan would cost an estimated $50 billion to $65 billion a year once fully implemented. That amount, however, is after deducting what the campaign says Obama's plan would generate through improved efficiency and other federal savings.

  The experts also said Obama could pay for his plan mostly through steps that the candidate has already said he would take — allowing President Bush's tax cuts on dividends and capital gains and on those making more than about $250,000 a year to expire in 2010 instead of acting to make them permanent.

  The rest of the $65 billion funding could come by raising taxes on inheritances worth more than $7 million. Many Democrats want to repeal Bush's elimination of taxes on estates worth more than $1 million. Obama wants the exemption to be higher but has not yet said exactly where it should be set.

  Obama's proposal would spend more money boosting technology in the health industry such as electronic record-keeping. His package would prohibit insurance companies from refusing coverage because of pre-existing conditions. It would also create a National Health Insurance Exchange to monitor insurance companies and limit their profits. Obama said the typical consumer would save $2,500 a year on premiums.

  Obama's first promise as a presidential candidate was that he would sign a universal health care plan into law by the end of his firm term in the White House. But there is some dispute over whether his plan would provide universal care — it's aimed at lowering costs so all Americans can afford insurance, but does not guarantee everyone would buy it.

  "It's not totally clear that it would result in universal coverage," said Ron Pollack, executive director of the advocacy group Families USA. He praised Obama and other leading Democratic candidates for focusing on improving health care.

  "What makes it a top national priority now is not simply a sense of sympathy for people who are uninsured but a sense of fear that the coverage that used to be taken for granted can no longer be taken for granted," he said.

  Obama aides said they believe that everyone would buy health insurance if it were affordable enough, achieving universal care. If some Americans are still uninsured after a few years into the plan, Obama would reconsider how to get to 100 percent, the advisers said.

  That's where he differs with Democratic rival John Edwards, the only other candidate who has laid out a specific plan. Edwards eventually would require every American to get health insurance, much like state requirements that drivers have auto insurance. Obama would only require that children be covered.

  Edwards spokesman Mark Kornblau said Edwards' plan, estimated at a total cost of between $90 billion and $120 billion annually, is "truly universal."

  "He believes that incremental measures are not enough," Kornblau said. "Any plan that does not cover all Americans is simply inadequate."

  Clinton has has yet to provide specifics of her health care plan. Clinton policy director Neera Tanden issued a statement commending Obama for entering the health care debate that she has long been fighting and saying that Clinton supports "true universal health care."

  In a CNN-Opinion Research poll conducted earlier this month, about two-thirds said the government should provide national health insurance for all Americans, even if it would mean higher taxes.

  ___

  Associated Press Writer Nedra Pickler in Washington contributed to this report.

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