The infuriating aspect of Obama's speech last night was the claim that health care reform is either free, because we can find hundreds of billions of dollars of bad medicine, fraud, and abuse in Medicare and Medicaid, or something we can just impose on health insurance companies, at no cost to consumers.
If the administration can make Medicare and Medicaid less expensive and more effiective - the same quantity and quality of care for less money - that is great, and everyone should sign on. But we know that is a pipe dream; if such a free lunch were available, someone would have eaten it already. It is trivial to make Medicare and Medicaid less expensive, of course: offer them to fewer people, or raise co-pays and deductibles, or reduce the amount of care they cover. But these adjustments involve real tradeoffs between winners and losers; they are not win-wins for everyone.
Paying for more government health care by imposing fees on health insurance companies is also not a free lunch: it means higher insurance premiums for those already covered, while federal subsidies make coverage cheaper for those newly covered. Thus again the plan involves winners and losers, not the same or more for everyone.
The health care proposals from Obama and Congress are not about making the health care system better, despite all claims to the contrary. They are about giving more health care to some people, and having other people pay for it. That is, they are about redistributing income, plain and simple.
If advocates for these proposals want to argue for this kind of redistribution, that is their privelege. But no one should mistake the fact that this is what is really going on.