Barack Obama yesterday welcomed proposals by the US healthcare industry to reduce costs by $2,000bn (€1,466bn, £1,312bn) over the next 10 years, as efforts to overhaul the health system gather pace in Washington.

Mr Obama said the savings were crucial not only to widening access to healthcare but also to stabilising the fiscal outlook, as the White House increased its official projection for the budget deficit this year and next.

The Obama administration has highlighted inefficiencies in the health system as one of the biggest fiscal challenges facing the US as it seeks to bring the deficit under control and build support for healthcare reform.

Mr Obama yesterday hailed an “unprecedented commitment” by leading healthcare groups to cut the growth in national healthcare spending by 1.5 percentage points each year.

“We cannot continue with costs that are out of control because reform is a necessity that cannot wait,” he said.

The voluntary cost controls were agreed by groups representing all of the biggest stakeholders in the healthcare industry, including insurers, pharmaceutical manufacturers, hospital operators and doctors.