More reminders for the need of strong health care reform
13 05 09 - 12:20
Reminders on Health Reform
Lawmakers who were paying attention got two powerful reminders this week of the critical need for them to pass the strongest possible reforms to bring down health costs and cover the unconscionable number of Americans — more than 45 million — who remain uninsured.
The more dramatic was the latest annual report from the Medicare trustees, released on Tuesday, which found that the recession had made Medicare’s already tenuous financial condition even worse, hastening the day the program’s hospital fund will face insolvency unless reforms are enacted. As Peter Orszag, the director of the Office of Management and Budget, repeatedly stresses, the only way to solve the fiscal problems of the big entitlement programs is to slow the relentless rise in the underlying health care costs.
The other reminder of the need for change was a pledge by leaders of the major health care industries to cut $2 trillion from projected health care spending over the next decade. It was a promising development, but probably not the “watershed event” that President Obama had proclaimed it. So far, all we have is a vague and unenforceable promise that may never materialize.
On Monday, groups representing insurance companies, drug and device makers, doctors, hospitals and a labor union pledged at the White House to shave 1.5 percent off the annual rate of growth in health care spending. That would reduce the growth rate from a projected 6.2 percent a year over the next decade to 4.7 percent a year, a seemingly modest amount that would, over time, produce substantial savings for the health care system, the federal government and individual families.
We hoped it was a sign that the industry believes major reforms are inevitable and is better off cooperating with the reform effort instead of opposing it.
For disparate elements of the health care industry to profess a willingness to reduce the unsustainable growth rate in health care costs is a huge difference from the early 1990s when the insurance industry and other special interests combined to defeat the Clinton administration’s health care proposals.
In the course of promising savings, health care leaders seemed willing to accept such long-sought reforms as comparative effectiveness studies to determine which medical procedures or products work best. Whether they will be willing to accept dictates that they use the best procedures or products seems doubtful.
Skeptics are right to be worried that health industry leaders are primarily trying to head off strong federal policies and regulations by making toothless pledges of voluntary action. None of the health care groups have agreed to accept any particular cuts. None have agreed to drop previous opposition to specific reforms under discussion in Congress. None are able to guarantee that their members will accept guidance from their national associations.
The industries need to come up with concrete proposals that the Congressional Budget Office can evaluate in terms of likely impact on health care spending. And Congress needs to find some mechanism to force savings from the industry if its voluntary efforts fail to reduce costs as promised.