Q+A: What does healthcare reform mean for Obama?

By Patricia Zengerle

5 Min Read

WASHINGTON (Reuters) - President Barack Obama travels to Virginia on Friday for a rally to promote his effort to revamp the $2.5 trillion U.S. healthcare industry, which faces a critical vote in the House of Representatives on Sunday.

Here are some questions and answers about what the battle to pass healthcare legislation means to the Democratic president, who postponed a trip to Indonesia and Australia to focus on his top domestic policy priority:

Congressional Democrats seem to think so.

Some House Democrats who had not planned to back the revamp have been swayed by concern that its failure -- after more than a year of intense effort -- could leave Obama unable to push through any major legislation.

With Republicans nearly unanimous in their opposition to Obama's major initiatives, they argue, Democratic divisions could irretrievably weaken him even though, for now, his party holds the majority of seats in both the House and Senate.

"We have to be very careful that the potential of President Obama's presidency not be destroyed by this debate," said Dennis Kucinich, a liberal congressman who had opposed the legislation, said at a news conference announcing his support.

"The Obama presidency will be crippled if this bill doesn't pass," said William Galston, a senior fellow at the Brookings Institution, an adviser to President Bill Clinton during his failed fight for healthcare reform in 1994, which led to the loss of the Democratic majority in Congress.

"I was there in the fall of 1994, and it wasn't pretty."

WILL OBAMA’S PLAN "BEND THE CURVE" AND KEEP HEALTHCARE COSTS FROM DESTROYING THE U.S. ECONOMY?

The $2.5 trillion U.S. healthcare industry accounts for one-sixth of the country's gross domestic product, and a centerpiece of Obama's argument for his overhaul has been that rising costs must be controlled because they risk destroying the economy.

Republicans contend that Obama's plan is too broad and too expensive, and will increase the already high federal budget deficit. They want the healthcare reform effort scrapped and to start over, taking a more incremental approach.

The Democrats’ case for the broad overhaul was boosted on Thursday when the Congressional Budget Office estimated that it would cost $940 billion over 10 years, but cut the deficit by $138 billion over the same period.

Many economists say the plan is at least an important step in the right direction toward controlling costs.

"I do think we have a credible shot at bending the curve," said Len Nichols, a healthcare economist at George Mason University in Virginia.

"(Healthcare is) the single biggest fiscal contributor to our structural imbalance. I don't know how to fix that without getting Medicare's delivery system better aligned with incentives. I don't know how to do that without systemwide health reform," he said.

"If there were a simpler, step-by-step incremental way, we would have ... written it down by now."

IF IT PASSES, WILL HEALTHCARE HELP OBAMA’S DEMOCRATS KEEP THEIR MAJORITIES IN CONGRESS?

If the overhaul passes, its influence on the election will depend on whether it works and how quickly voters start to feel an impact.

If Obama can get a bill through Congress in the next few weeks, and Americans feel they are benefiting from its provisions by November, it will be hard for Republicans to convince the public not to embrace the legislation.

If voters do not feel the benefits by November, the Democrats will have a harder time, especially if joblessness still hovers near 10 percent.

"In the end, what will be remembered is whether the bill produces what it's promising," said David Kendall, senior fellow for health and fiscal policy at the centrist Third Way think tank.

IF IT FAILS, WILL HEALTHCARE COST THE DEMOCRATS THEIR MAJORITIES IN CONGRESS?

The party that holds the White House typically loses seats in Congress in the first election after a new president takes office.

The Democrats lost their majorities in Congress in 1994, after Clinton tried and failed to reform healthcare, amid Democratic divisions and high voter turnout.

Failure this year would likely hurt them again. After a year of political squabbling about healthcare, voters will be angry at both parties, but Democrats will be hurt more.

"If it doesn't pass, then I think the scenario from ‘94 has a more likely impact because voters will be disappointed that, after all the fighting and everything they put up with for the last year, they don't see results," Kendall said.

Democrats -- and Obama -- will also be hurt because they had the majority, made the effort, and failed to win.

"If you can't lead, you look weak, and Americans don't like weakness," Kendall said.

Editing by David Alexander and Chris Wilson

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