Democrat senators deal blow to Obama's health revolution

Facing the toughest test yet of his young presidency, Barack Obama flew to the American heartland to make a direct sell of his ambitious healthcare reform plans to an American public that may be as sceptical about its wisdom and workability as Republicans and some conservative Democrats are on Capitol Hill.

Mr Obama was yesterday on the stump in Cleveland, Ohio, trying to remind voters that his commitment to overhauling the country's healthcare system was one of the reasons they put him in the White House. But even as he made his pitch to regular Americans, back in Washington the leadership of his own party in the Senate declared it would not be able to pass his signature proposals until after a month-long recess.

Nancy Pelosi, the House of Representatives Speaker, insists that a bill will pass by the end of the year. But the news was a blow for Mr Obama, who had insisted that both sides of Congress should get their own versions of a healthcare reform bill passed by the end of next week, before their break. Now the best hopes of enacting the reforms will have to be delayed until autumn and the task of persuading the country to back him is harder than ever.

Mr Obama's day of campaigning began before news of Congress' decision broke, in the famed Cleveland Clinic. The clinic was chosen for a visit, aides said, because of its reputation for cost control and exemplary care. Mr Obama then went on to a high school in the prosperous suburb of Shaker Heights to host a town hall-type meeting on healthcare. Before taking questions from students and other invited members of the public, he told them: "We have never been closer to achieving quality, affordable health care for all Americans. But at the same time, there are those who seek to delay and defeat reform."

During a prime-time press conference on Wednesday night, Mr Obama had acknowledged that with the bi-partisan squabbling that had broken out on Capitol Hill, ordinary Americans might have lost track of the benefits of his reform for them. "They feel anxious, partly because we've just become so cynical about what government can accomplish," the President said. "People's attitudes are, you know, 'Even though I don't like this devil, at least I know it. And I like that more than the devil I don't know.'"

The President's approval rating slipped below the 60 per cent threshold for the first time this week, according to a Washington Post poll, and healthcare appeared to be one of the main drags. Satisfaction with his handling of the issue had dropped eight points in three months to just 49 per cent, while disapproval had shot up 15 points to 44 per cent.

Wednesday night's press conference – his fourth since he took office six months ago – gave Mr Obama the opportunity to underline to voters that he still considered revamping a system that leaves roughly 46 million Americans without any insurance coverage an absolute priority. The plan, he said, would put "more money in people's pockets" and improve levels of care. He added: "If we do not reform healthcare, your premiums and out-of-pocket costs will continue to skyrocket. If we do not act, 14,000 Americans will continue to lose their health insurance every single day."

But it was also an attempt to corral back into his camp several conservative "Blue-Dog" Democrats in the House of Representatives who were balking at some provisions in the bill, which promises to cost roughly $1,000bn (£600bn) over 10 years. Particularly controversial are calls to impose tough new taxes on those earning $1m a year or more to help pay for it and create a public insurance option.

Republicans, meanwhile, are wary of being seen to be keen simply to tear down Mr Obama. There has been some breaking of ranks, for instance, since Senator Jim DeMint of South Carolina last week publicly stated that if the party could stop Mr Obama on healthcare, it "will be his Waterloo, it will break him".

Senator Lamar Alexander of Tennessee this week cautioned that "this is not the view of our caucus". But in an ominous sign, Orrin Hatch, the influential Republican senator from Utah, criticised Mr Obama's rush to get the bills passed without properly assessing how it would be paid for.

Mr Obama's desire to get the bill passed before the end of the month is now in ruins. But why was he in such a hurry? The real answer is that the longer this overhaul takes, the quicker the momentum would drain away and the easier it would become for opponents to pick new holes in it.

But that's not how Mr Obama answered the question, choosing to pivot away from the political wranglings of Washington and back to the needs of people. "I'm rushed because I get letters every day from families that are being clobbered by healthcare costs," he said.

So what do the critics say?

Healthcare reform will wither without support from conservative Democrats and possibly some centrist Republicans too. Here are their worries about the plans as they are now formed:

OBLIGATORY COVERAGE

Provisions to oblige employers to offer healthcare coverage to their employees (with some exceptions for small businesses) are part of Obama's attempt to ensure everyone has coverage. However, conservative Democrats say that while all employers would love to give their workers coverage, some just can't afford it and might be forced out of business if made to do so.

PUBLIC INSURANCE

Obama is pushing for a public health insurance body to provide an alternative to the private health insurance marketplace. But critics charge that an entity that is subsidised by government funds would be unfair competition to the existing insurance industry and may kill it off outright. And if the public insurance option becomes wildly popular, the drain on the Treasury over time may become intolerable.

LOST COVERAGE

Some members of Congress fear that the negative impact of a public insurance option on the existing private marketplace might actually lead to more people losing their insurance than gaining new coverage.

COSTS AND TAXES

The President continues to insist that whatever comes out of Congress must pay for itself and not contribute to an already ballooning federal deficit. But this will be hard to do. Democrats in the House came up with a schedule of surtaxes for wealthier Americans that would affect not just those earning $1m or more but those with incomes over about $350,000. But any new taxation is a cause for heartburn for the American political classes.