President Barack Obama returned from his overseas tour on Sunday to a struggle over his most important domestic promise: to reform America's ailing health care system.

Mr Obama has pledged to succeed where Bill and Hillary Clinton failed in the early 1990s and sign legislation by the end of this year guaranteeing health insurance for almost all of the 47 million Americans presently without cover.

Sharp disagreements have emerged over how to pay the bill of at least $1 trillion over ten years. Conservative Democrats in the House of Representatives oppose plans to raise taxes on the rich. Meanwhile, some Left-wing Democratic Senators, who are working on their own version of the law, are wary of a proposed new tax on the health insurance benefits provided by some employers.

An overhaul of health care, which would usher in a major new role for government, could become the defining issue of Mr Obama's first term, and help determine whether he wins a second.

"I'm confident that we're going to get it done," he said last week. "It is going to be hard, though. As dissatisfied as Americans may be with the health care system, they're also afraid of the unknown. And we have a long history of scaring people that they're going to lose their doctor, they're going to lose their health care plans, they're going to be stuck with some bureaucratic government system that's not responsive to their needs," he added.

Bringing the legislation to a vote this year is crucial because Congressmen might be reluctant to consider such a charged issue next year, when all House members and one-third of Senators face midterm elections.

There is widespread agreement that reform is essential and, for the first time, hospitals, health insurance companies and doctor's associations are broadly supportive of change, making the passage of some form of legislation much more likely.

Health care spending in the US has risen faster than inflation for years, and in 2008 accounted for $2.14 trillion, a sixth of the nation's gross domestic product and a sum only slightly lower than Britain's entire GDP.

America spends more per capita on health than any other country, yet 15 per cent of its 304 million people remain uninsured and millions of others find their policies deficient in the event of severe illness.

A guarantee of health insurance would make a significant difference to people like, Valerie Goodness, a firefighter who was forced to leave her job because of her 13-year-old son's autism. When her employer changed insurance companies, the new company refused to cover her son because of his "pre-existing condition" – a common dodge that is regarded as one of the system's great iniquities.

Now, if she earns more than $1,000 a month, she will lose the insurance provided by Medicaid, a state programme for the poor.

"And there is no way I could earn a job that would pay enough to pay for private nursing at $20 – $30 an hour. I feel like I am forced into poverty just so I can get insurance," said Mrs Goodness.

Most Americans get medical insurance from their employers, who choose from a variety of competing companies. The system has spurred innovation, helping American hospitals and specialists to become the best in the world, but it has also driven up costs.

"We have a payment structure that rewards volume over value," said Elizabeth Carpenter, of the New America Foundation think tank, adding that she is convinced reform will pass this year. "People in the health community see the writing on the wall. They see this is the last chance to preserve a uniquely American health care system. No reform will be perfect but we have to start."

Source