White House, Congress, industry taking on health costs

Health care costs soared nearly 50 percent between 2000 and 2006, adding an urgency for reform that may help Democrats pass a major overhaul before the year-end deadline set by the White House, Bloomberg reports.

"You come to a point where you can't afford health care as it is and you have to reform it," Rep. John Dingell, D-Mich., told Bloomberg. As Congress seeks to capitalize on spending growth, industry groups have arrived at the table with their own suggestions for cutting up to $1.7 trillion in spending over the upcoming decade (Litvan, 6/2).

Those groups--the American Medical Association, America's Health Insurance Plans, the Pharmaceutical Research and Manufacturers of America, the Service Employees International Union, Advanced Medical Technology Association and the American Hospital Association--offered details of their plan Monday. Among the steps they outlined is "improving chronic care management" which they estimate would save between $350 billion and $850 billion. They propose reducing "unnecessary utilization," and increasing adherence to needed medicines. Their plan also includes "pledges to try and reduce medical errors, switch to common insurance forms, improve measurements of physician performance, reduce the number of patients readmitted to hospitals, improve the efficiency of drug development and expand in-home care for patients with long-term illnesses," the Wall Street Journal reports (Adamy, 6/1).

The groups say that their cost-cutting proposal, first announced at a White House meeting in May, would "depend on 'good public policy' in a proposed health industry overhaul" by the administration, Reuters reports (6/1).

The White House, meanwhile, has sharpened its strategy for selling health reform to lawmakers and the public by arguing that cost cuts would yield "enormous benefits for the nation's economy," the Washington Post reports. A new report by the president's Council of Economic Advisers suggests that slowing the rate of spending growth from 6 percent a year to 4.5 percent could create 500,000 jobs, increase the annual income for the average family of four by $2,600 and "remove 'unnecessary barriers' to job mobility and increase the nation's overall economic well-being by 'roughly' $100 billion a year" (Connolly and Montgomery, 6/2).

"The report comes as the White House ratchets up its public advocacy for a health care reform bill, which congressional Democratic leaders have promised to deliver by August," reports Politico. The report says, "Because such a substantial reduction will require hard choices and the cooperation of policymakers, providers, insurers, and the public, success is not guaranteed. But, the economic benefits of achieving successful reform would be very large"  (Brown, 6/1).