Obama Budget Would Create $634 Billion Health-Care Fund

Obama's new health care plan with is one of the three focal points of his administration will change the way insurance and pharmaceutical companies operate. Nearly one-third of the reserve fund would be generated by forcing private insurers who sell Medicare managed care plans to undergo a competitive bidding process. Drug manufacturers and hospitals would face reductions as well. If the budget is approved, drug companies would be required to increase the rebate they now provide for medications sold to Medicaid patients from 15 percent to 21 percent.