"How much does it cost?” President Lyndon B. Johnson asked Wilbur Cohen, his health care expert, who was on the phone. Cohen had just negotiated final details of the bill establishing Medicare in March 1965. “It would be around $450 million more,” Cohen replied, referring to a last-minute accommodation that added coverage for doctor visits. In 45 years, that annual $450 million portion of Medicare has grown to nearly $200 billion.

   Photo: iStockphoto

Six years ago, when Congress was expanding Medicare to include prescription drugs, the Bush administration estimated that the drug benefit would cost slightly more than $100 billion a year. Today, the actual cost is 40 percent less.

Clearly, projecting the cost of health care is no easy task. That adds an unsettling but essential ingredient to the effort to overhaul the nation’s health care system. Lawmakers are hotly debating how to extend health care to 46.7 million uninsured Americans, expand Medicare to people under 65, help business meet the soaring cost of employee health insurance, improve quality, and trim the excesses from the $2.5 trillion the nation spends each year on health care. But little attention has been given to how we’ll actually pay the bill.

Here’s what we know for sure: Financing the ultimate reform package will be expensive, perhaps as much as $1.3 trillion over the next decade.

To his credit, President Obama has laid out financing options. But they are just the start of a discussion that has yet to take shape.

His plan includes: limiting deductions for charitable contributions, mortgages and medical expenses for those earning more than $250,000 (to raise $318 billion over 10 years); trimming $175 billion from Medicare Advantage plans, the private fee-for-service Medicare plans now serving 10 million people; saving $38 billion by paying doctors according to the outcome of treatment rather than per visit, and limiting hospital readmissions; requiring individuals to enroll in a plan; and requiring business to provide health insurance for employees. Other ideas range from taxing high-income workers for their employer-provided health care to a tax on junk food.

Both the president and Congress acknowledge that health care cannot be financed by adding to the already staggering national debt.

But the essential point is this:

This is not a mathematics exercise.

This is an opportunity to change the way we think about health care, to change the course of health care costs and to change the pattern of health care access and delivery. We’re not talking about socialized medicine here, but rather a uniquely American system built on the existing network of employer-provided care, private insurance and a strengthened Medicare. AARP has a specific interest in making Medicare available to those between 50 and 65, in narrowing the prescription drug program’s doughnut hole, in financing home- and community-based caregiving, and in encouraging preventative medicine. The ultimate goal is to raise the quality and lower the cost of the nation’s medical care.

Jim Toedtman is editor and vice president of AARP Bulletin.