The Promise of $2,500 Savings: Part I

The biggest, most substantial -- whatever you want to call it -- portion of the Obama health plan is the $2,500 promise.

It has been part of the Obama plan from the beginning. The long version of the plan put out by Senator Obama's plan put it in a box at the beginning of the document: "Under the Obama plan, the typical family will save up to $2,500 every year..." Now there was a bit of shading in the words "up to". That was the formulation in Senator Obama's speech when he announced his plan in his May 27, 2007 speech at the University of Iowa: "I want to lay out the details of that plan - a plan that not only guarantees coverage for every American, but also brings down the cost of health care and reduces every family's premiums by as much as $2,500." [Emphasis added.]

The $2,500 promise had its origin at a time when Sen. Hillary Clinton was the frontrunner for the Democratic nomination. Her rhetoric emphasized coverage; her plan had the title, "American Health Choices Plan: Quality, Affordable Health Care for Every American." For "Americans who are satisfied with the coverage they have today," the Clinton plan said, they "can keep it, while benefiting from lower premiums and higher quality."

Senator Obama gave more emphasis to the growing cost of health care. His University of Iowa speech emphasized the relationship of coverage and cost. After the sentence quoted above, he continued, "This second part is important because, in the end, coverage without cost containment will only shift our burdens, not relieve them."

One can envision the scene as the University of Iowa speech was drafted:
"This will help us distinguish Sen. Obama from Sen. Clinton."
"But it needs to be more concrete."
"Yeah, let's put a number in here."
And somehow the debate settled on $2,500. Talk about sticking in a shovel and digging a hole. Is this possible? And even if possible, is it plausible? Addressing this question will take several posts.

The $2,500 promise could have been left behind in the haze of the primary season. But it seems to be very much alive. Senator Obama reaffirmed this approach in his acceptance speech at the Democratic National Convention: "[I]f you have health care, my plan will lower your premiums..." Senator Biden, in his acceptance speech, didn't say it was premiums that would be lowered, but he did say it would be $2,500: "Barack Obama will bring down health care costs by $2,500 for the typical family, and, at long last, deliver affordable, accessible health care for all Americans."

Next: What could be meant by saving "up to $2,500"?