Fixing health care isn’t just possible this year – it’s absolutely necessary. Every day, people are losing their jobs and their health care. The swelling ranks of uninsured threaten to put more strain on state programs and push the entire system to the breaking point. If health care isn’t fixed, the risk is a growing catastrophe on top of the ones we already face. The unemployment rate is now 7.6% ­­– up from 4.9% a year ago. For every 1 percentage point rise in unemployment, another 1.1 million people lose their health coverage. Clearly, the time to act is now. As President Obama put it: “In order to fix our economic crisis, and rebuild our middle class, we need to fix our health care system, too.”

Health care reform can happen this year if lawmakers, business, labor, health care providers and activists come together to advance a common goal: quality, affordable health care where everyone pays their fair share. It can happen if we agree to build on existing coverage arrangements instead of disrupting them – the current system of employer-sponsored coverage and public programs such as Medicare, Medicaid, SCHIP. Reform should also include ending discrimination by insurance companies, offering financial assistance, and rewarding providers and insurers for quality instead of quantity of services provided. We know that when everyone participates, shared accountability works.

The future Health and Human Services Secretary will no doubt be a partner in the movement to fix health care. But, real change comes from the ground up. It comes from workers saying enough to surging health care costs and shrinking benefits. It comes from doctors and nurses saying enough to a system that puts profits ahead of patients. The reauthorization of SCHIP and inclusion of health information technology in the recovery act are already significant downpayments on broader health care reform. Let’s not stop now. All across the country, voters sent a clear mandate this fall to make the American Dream affordable again – and put an end to Washington’s bickering-as-usual. A health care system that works for everyone is essential to building an economy with lasting strength.

The major compelling question of the current health reform debate is not necessarily WHAT to do, but how much can be done, and whether or not there is enough political will and capitol to force those often painful changes through.

Health care is 16 percent of the nation’s GDP and growing. Quality is often poor, costs are undeniably high and there are more than 45 million uninsured. What that means is that fundamental change is needed everywhere. Fundamental change does not come quickly and certainly will not come without broad bipartisan political support.

Complicating matters, with an economic stimulus/recovery package still under negotiation, it is too early to tell what the lessons are to be learned from it. Will the message be that we have simply spent too much in trying to jump start the economy and Dickensian belt-tightening will be the wave of the future…or will the message be that deficits don’t matter, that money doesn’t matter and the sickly health care system (like the economy) must be resuscitated at all costs?

Health care reform CAN be done this year, but the only practical path lies in bipartisan compromise and incremental steps. Governors have a long history of forging bipartisan compromises on significant policy issues, and the National Governors Association is currently convening a bipartisan health care reform task force to look at many of the health care challenges confronting our nation. While sitting governors don’t have any votes in the House or the Senate, we will gladly share our consensus ideas with our federal partners in the hopes of improving our broken health care system.

Improvements to America's health care system are important to both patients and the nation's economy and should not be subjected to a long postponement. It is certainly encouraging that Congress and President Obama took a vital first step with reauthorization and expansion of the State Children's Health Insurance Program (SCHIP), but so much more must be done and the sooner we initiate reforms that are needed, the better off we'll be.

The fact is millions of Americans remain uninsured and the human and economic costs of avoidable chronic diseases continue to grow. Disease prevention needs to be more strongly emphasized as an investment that can reduce future health care costs and improve productivity. And we need to address gaps in the quality of care for different patients.

Until we tackle these problems, too many patients will continue to suffer and America's economy will suffer, as well. A 2007 Milken Institute study found there were more than 162 million cases of seven common chronic diseases, including cancer, diabetes and heart disease, reported in America in 2003. Those diseases cost the nation over $1.3 trillion in treatment expenses and lost productivity that year alone.

The Milken Institute report estimates that with "reasonable improvements" in preventing and managing chronic diseases, the United States could reduce the future economic costs of these medical conditions by $1.1 trillion annually, or 27 percent, by 2023. Treatment spending would be cut by $218 billion and $905 billion in savings would come from gains in worker productivity as patients obtained better care, including prescription medicines.

PhRMA supports reforms aimed at providing all Americans with access to affordable health insurance and addressing the burden of disease, health care costs and gaps in the quality of care. The expanded SCHIP program is a welcome development because it will provide high-quality comprehensive health insurance coverage to about 11 million children in working poor families that don't qualify for Medicaid. The children will receive a wide range of health services, including regular medical check-ups, immunizations, prescription medicines, laboratory tests, x-rays, hospital visits and more.

Health reform is not only possible in 2009, it is imperative. Without health care reform, our economy cannot recover, grow, or remain competitive around the world. And without health care reform, costs will continue to grow at a skyrocketing pace, crushing American families and forcing more and more Americans to go without health insurance. This is a trend that cannot continue. According to one estimate, the cost of doing nothing about health care could be as high as $200 billion a year and rising. The same study estimates that, as health care inflation continues to outpace wages, the average cost of health insurance for a family could reach $24,000 in 2016 – an 84 percent increase from today.

Reforming the health care system will not only curb the growth of health care costs, but it will also increase access to health care – a necessity that 46 million Americans do not have today. And reforming health care will significantly improve the quality and efficiency of our system, getting patients the most appropriate care quickly and reducing medical errors. The health reform plan I released last November outlines a path to those goals. And we can realize that plan.

The American people overwhelmingly support reform of the health care system. President Obama stated throughout the campaign and in his inauguration address that health reform is an important priority for his administration. And health care reform can and should be a bipartisan effort. In recent months, I’ve discussed reform with my Republican colleagues and I’ve found that we share many goals. As the reform process moves forward, I intend to work together with Democrats and Republicans to craft consensus legislation.

Soon, the Senate will conclude its work on the American Recovery and Reinvestment Act, and I intend to turn the attention of the Finance Committee to health care reform and finally create the universally accessible, high quality, low cost health care system that works for American families and boosts American competitiveness.

The prospects for health reform in 2009 are still high, despite Senator Daschle’s withdrawal and the worsening economy. In fact, the economic crisis has made the case for reform even more compelling. Indeed, it is useful to remember that the health reform debate is far larger than any one man or woman and the underlying reasons for reform are unchanged.

· Our health system is on a trajectory that cannot be sustained. The costs of inaction are high and they will only rise over time. Families, employers, and governments are all threatened by rising health care costs. These trends will not change on their own. In fact, they will worsen. This issue is not going away and neither are the "strange bedfellow" coalitions of business, labor and consumer groups that helped make health care a decisive issue in the 2008 campaign.

· Our struggling economy has revealed and worsened the flaws in our health system and the call for reform will grow more urgent as a result. More and more families are losing insurance along with their jobs and are finding themselves unable to afford essential health care services. Countless interviews and media reports have documented jobless families who view affording health care as one of their most immediate economic concerns. The economic crisis only further demonstrates the need for reform and will only heighten the public's awareness of our system's gaps. It also raises the ante for Congress. While partisan posturing will not end tomorrow, most members will not be able to do nothing and declare victory to the people this time. Doing nothing on health care will be seen as a failure, much as failure to pass a stimulus package will be seen as irresponsible.

· Health reform remains a priority for the Obama Administration and for Congress. David Axelrod captured this best when reminding reporters last week that "this issue has great power of its own." President Obama has stated consistently that making insurance affordable for all Americans is a primary goal of his administration. This goal is shared by key Congressional leaders, including Senate Finance Chair Max Baucus, HELP Chair Ted Kennedy, Energy and Commerce Chair Henry Waxman, and Ways and Means Health Subcommittee Chair Pete Stark. Now that SCHIP is signed with the economic stimulus package soon to follow, the full attention of these key leaders will shift to comprehensive health reform.

· The American people, throughout the 2008 campaign and beyond, have called for a better, more affordable health system. The people who sent Barack Obama to the White House will not change their views on our health system because of Tom Daschle's withdrawal. They elected Obama to do a job, and what particular individual holds what particular job matters little in the grand scheme of the overwhelming desire for "real change."

As many of you know, I was a senior adviser at the Office of Management and Budget (OMB) during the Clinton-era reform efforts. Throughout the past week, I was compelled to recall what we were all doing in February 1993. At this moment (and many other moments) 16 years ago, we were going through an Ira Magaziner "toll gate" exercise with 500 of our closest friends. In large working groups, we were trying to write down a detailed blueprint of a new health care system that did not exist in nature.

Look where we are now. This time, the chairs of Finance and HELP have pledged to work together to build upon our existing system, while making it work better for all. We also have a president who understands that the lessons of 1993-4 require (among other things) an unshakable commitment to bipartisan conversation. (And yes, health reform must and can still be bipartisan).

Further, many more stakeholders, like our own group Health CEOs for Health Reform, and countless other employers and labor leaders are willing to say, "The status quo is unsustainable and we CAN work collectively to align interests and reform our system to serve everyone."

We should not lose sight of how much further along the health reform debate is today compared to the winter of 1993. Congressional leaders have emerged; bipartisan conversations have been initiated; and, industry leaders have shown some signs that they are willing to engage, rather than obstruct. The moral and economic motivations for this issue are too strong, the costs of failure too high, and the progress towards our goal too great for our optimism to wane. Now remains the time to act.

In Tom Daschle, President Obama had a talented individual who could well have led major health care reform. But the reform Daschle envisioned was a health care system shaped and molded by government. We would have increased taxes and increased government health insurance, turning the private insurance market upside down. And yet at the end of the day, we would have made little progress on the triple problems of rising cost, inadequate quality and lack of full access to care.

Fortunately the opportunity now exists to move in a much more promising direction. Instead of command and control, let us hope that Daschle's replacement tries to implement reforms to promote consumer choice and competition in the marketplace. Instead of trying to force doctors and patients to do what is not in their self interest, we should seek to free them from the straitjacket of an unworkable, unsustainable, bureaucratic system.

Assessing the odds for health care reform in 2009 is speculation at this point. What is certain is that successful health reform requires that HHS be organized and managed to inform and participate in the health care debate and to be a key stakeholder in implementing reform legislation. A recent IOM study, HHS in the 21st Century; Charting a New Course for a Healthier America (http://www.iom.edu/), identified and explored the staggering range of issues facing the agency. The most critical challenge is the need to align the missions of the many programs HHS oversees, including the CDC, FDA, NIH, CMS, and AHRQ and then focus the Department’s operations on achieving policy goals. The new secretary of HHS will be confronted with two interrelated challenges. First, as an individual, he or she must get up to speed on the politics of health care (and the administration), including the key players, constituents and relevant legislation. Second, as a manager, he/she must take the time to look internally and assess the management issues facing HHS. With or without health reform, HHS-- which touches the lives of virually all Americans-- needs to change. Appointing different people to lead the Department and Office of Health Care Reform makes sense in this context. We need a manager and implementer to improve performance at HHS regardless of the outcome of the health reform debate. The President needs a full time leader to help define and lead a reform agenda with special attention to guiding the legislation (where the devil and the details both reside) through Congress.

I apologize in advance for dampening the mood.

So far this year (and we are only 40 days in), we have spent or arranged to spend:

• $31 billion to expand the State Children’s Health Insurance Program.
• $87 billion to bail out the Medicaid program.
• $30 billion to subsidize COBRA coverage for discharged employees.
• $21 billion to fund health information technology and comparative effectiveness.

Obviously some of this is subject to change during continuing negotiations, but the point is we have already spent a huge amount of money, very quickly, on health care. Every dollar we spend on this expends not just monetary but also political capital, and lessens the public’s appetite for a massive “grandiose scheme” bill that will completely reform and revamp the health care system.

Tom Daschle’s tax shenanigans do not spell the death knell for health reform, but they complicate an already tenuous process. Daschle was in a unique position and had unique experience that qualified him to bring action to the health reform debate. His loss will definitely delay and cost the process.

Further, House leadership and important committee chairmen have said, repeatedly, that health reform is no longer a 2009 issue.

Add all of this up, and what I see is an increasing likelihood that health reform is dealt with in 2010. While we are all eager to cover the uninsured and get a handle on health care costs, this is not necessarily a bad thing – we need to do this right, the first time, and that will necessitate a robust, patient debate and dialogue. Rather than trying to jam health reform through this year, let’s work to make important inroads and build consensus first.

As Ron Pollack noted, the key leaders who will be responsible for health care reform - Max Baucus, Ted Kennedy, and Barack Obama - have not wavered an inch in their commitment to reform and the timeline of getting it done this year.

They understand that the cost of doing nothing is unconscionable. They understand that there hasn't been this kind of political will, grassroots support, champions in Congress, and possibility from the White House behind a push to finally provide quality, affordable health care for all in at least 15 years, perhaps decades.

The time is now. We need the policy more than ever and the politics has never looked so good. Yes we can, in 2009.

It’s clear there is no room for slowed momentum on health care reform. The system is broken, and the stakes are high. The American Medical Association sees covering the uninsured as a top priority, especially during the current economic crisis. Unemployment jumped to 7.6 percent in January, the largest one-month job loss since December of 1974, likely adding even more Americans to the ranks of the uninsured and putting even more pressure on state health care programs.

Americans rank helping the newly unemployed afford health insurance coverage second behind helping businesses keep or create jobs. Clearly, physicians, employers and the general public believe now is the time to take advantage of this historic opportunity to enact health system reform. Congress and the administration have already taken the first step to reduce the ranks of the nation’s 46 million uninsured by passing a new law extending health care coverage to about four million more American children and we need to build on this momentum to do more.

The AMA has a long history of a productive working relationship with the Department of Health and Human Services, and we will work closely with the next Secretary to improve the system for patients and physicians. The AMA is fully engaged, and working in a bipartisan manner with the new administration, Congress and health care stakeholders to bring needed change to the health care system for all Americans.

“Yes, we can. It will take a new Secretary’s confirmation and an agreement with Congress on the main elements and timetbale. Meanwhile, careful implementation of the Health IT money as the first building block will be critical.

In addition, quick implementation of the SCHIP Bill and some waivers to states for experimentation on expanding coverage could reduce uninsured kids dramatically.”

Yes, Senator Daschle’s departure and the ongoing recovery/stimulus debate is distracting, but it is far from fatal. To the contrary. The road to comprehensive health reform is and will be full of speed bumps, pot holes, detours – both scenic and otherwise, and near fatal accidents. But, as wise investors always say, the smart money is always invested with the ones who understand the fundamentals. And the fundamentals on reform are much better than the daily D.C. prognosticators may think.

The first fundamental is simple: Health reform is a top priority for the new President. He sets the agenda and he has the bully pulpit. If President Obama prioritizes it in his budget and it -- and his accompanying vision -- contains (a) some tough but strategic savings and financing provisions, (b) good policy; (c) sound messaging; and (d) a strategy to work with the Congress, the stakeholders, the opinion leaders and the press, he will kick off a long overdue debate that has a very real chance to succeed – and succeed this year..

It can succeed because the second fundamental already exists – the need, desire and openness of the public and their employers to finally address an issue that really matters to them – health care cost relief and coverage certainty – even if requires some sacrifice to achieve real security. They are increasingly worried about losing what they have and are looking to their leaders to lead on this issue. In short, the truth is that this economic crisis (which in the minds of the public threaten both jobs and, even more scary for many, health care) breeds openness to, and opportunity for, real federal leadership on the health care front. It is my belief that, notwithstanding the current partisan debate over the recovery/stimulus legislation – and perhaps because of it -- there are numerous Republicans who want to engage in a constructive collaboration with Democrats to finally get this job done. This year, there will be an opportunity to do just that.

And the third fundamental might be the most important: the stakeholders (AKA the special interests if you live outside of D.C.) are just now starting to get that this may well be the last year for the Obama Administration and the Congress to engage in meaningful reform that is financed by thoughtful combinations of reinvested health care savings, restructured and/or new revenue sources, and defensible baseline adjustments. They will be the first to realize their vulnerability to the deficit hawks who will be all too likely to turn this into a federal numbers-driven, scapegoat-applying cost-shifting game. The stakeholders have seen this movie before and they are not interested in seeing a sequel. In short, when it comes to health reform, fear beats hope. In the past, this has meant that nothing gets done. This time it might mean that the stakeholders – whether they be consumers, employers, and labor OR providers, plans and manufacturers -- will be motivated to make sure it does.

Sure, comprehensive health reform is hard and it is always more unlikely than likely. But the truth is, it remains far more likely than it ever has been. For those of us who can make a difference to making something meaningful and important happen – from whatever side of the political specter we reside – shouldn’t we be the ones who help make it happen, rather than to list all the reasons why it might not?

The professional naysayers about health care reform will no doubt seize upon Tom Daschle’s withdrawal as evidence that the opportunities for health reform have diminished. To be sure, Tom brought all the right credentials, commitment, energy, and connections to help promote health care reform. But Tom’s withdrawal will not significantly slow down the health reform effort.

Success with health care reform rests with the President and the key committee chairs that have jurisdiction over health care: Senators Baucus and Kennedy as well as Representatives Waxman, Rangel, and Miller. All of them are deeply committed to achieving meaningful health care reform – and achieving it this year.

Health care reform has never been easy. Long-term reform will need to be handled in a fiscally responsible manner, and early investments will need to be made. This is true in good and difficult economic times.

The economic downturn, however, demonstrates that there is a key role that the public sector must play alongside the private sector. The downturn also reminds us that the long-term imperative of fixing the economy requires meaningful health care reform so that health costs are sustainable for businesses, families, and government agencies. All the key stakeholders understand and appreciate this, and failure to achieve reform – and doing so promptly – is simply not an option.