Topic A: The Health Care Industry Gives Obama Momentum?

Monday, May 11, 2009; 6:47 PM

Today representatives from across the health care industry joined with President Obama to announce that they could achieve $2 trillion in savings over the next 10 years. We asked experts and activists to explain the significance of this announcement for Obama's health care proposals. Below are contributions from Len Nichols, Henry E. Simmons, Ralph G. Neas, Rick Scott, Robert Shrum, Thomas Miller and Robert E. Moffit.


Director of the Health Policy Program at the New America Foundation; senior adviser for health policy in the Office of Management and Budget, 1993-1994

The health care industry's announcement that major savings are possible and that it is committing to work with Congress and the Obama administration to reduce cost growth is very good news for those who want health reform this year. It demonstrates that even people who make money from -- and sometimes because of -- our inefficient health care system recognize that our current path is unsustainable. Historically, they opposed reforms that would improve quality and control costs.

Essentially, health industry players just agreed with experts on the scale of savings we need. That gives members of Congress added confidence that they can aggressively seek reform and work with the health care industry to fix our broken health care system, rather than against it. There is much analytic work left to be done. But this announcement is reason to be optimistic about our chances to achieve and sustain quality, affordable coverage for all.


The authors are, respectively, the president and the CEO of the National Coalition on Health Care

This encouraging news highlights the importance of containing health care costs -- and we hope that it will help to build the momentum for reform. That said, those who favor broad health care reform need to interpret it with some caution.

Details will matter mightily. Major organizations in the health care sector are promising to develop proposals -- regarding, for example, coordination of care and administrative simplification -- but we don't know at this point what precise commitments those proposals will entail.

Voluntary activities also aren't a substitute for legislated cost containment. In fact, the record of voluntary initiatives to reduce health care costs hasn't been all that good over the years -- and if it had been better, we wouldn't be in the fix we're now in.

We hope these organizations will now support legislation that includes provisions on the commitments they've made -- and, beyond that, constraints on reimbursement that will slow the rate of increase in health care costs in the near term as those other, longer-term measures are implemented.


Chairman of Conservatives for Patients' Rights

Today's announcement is like many in Washington: long on admirable goals but short on details about how to reach those goals. There are two ways to control health care costs: using the free-market to the benefit of patients, which means no government-run option competing with the private sector as Obama wants, or the rationing of care such as is done by the British and Canadian governments. It seems Congress and the administration favor a government takeover of the industry; Congress has quietly created a national health care board -- the Federal Coordinating Council for Comparative Effectiveness Research -- eerily similar to a board in Britain that rations care, dictates to doctors how to practice medicine, denies treatments and drugs and puts a value on each British citizen's life.

As the details get filled in, interest groups, industry trade associations and the Obama administration should know that the American people will not accept any reform where bureaucrats rather than doctors and patients make health care decisions. This announcement does not change that.


Democratic strategist and senior fellow at New York University's Wagner School of Public Service

Today's announcement proves how right President Obama was to reject advice to postpone health reform for at least a year. Health care companies can read the public mood and the current congressional calculus that will make it possible to pass a bill. So Republicans have now lost traditional allies who prefer a say in the outcome to a futile, last ditch battle for a broken system.

The brakes on health cost inflation now have to move from promise to enforceable legislation. They will. The companies have to accept some form of competing public entity. They will. And, remarkably, they're the ones pushing hard for universal coverage. Just maybe some Republicans beyond the wan moderate remnant will decide it's the better part of partisanship to be a little bipartisan as we finally take this historic step. After today, I have no doubt that it will happen -- this year.


Resident fellow at the American Enterprise Institute; senior health economist for Congress's Joint Economic Committee, 2003-2006

Well, at least the various health industry interest groups could agree on three things with the White House today. First, rising health costs are really everyone else's fault, but we in the broader industry will have to grin and bear the first round of blame. Second, we really, really want to stay in business, by any means necessary. Third, it's much easier to divide up some of the health spending pie when we get to sit near, albeit under, the table.

This will have to pass for progress in Washington, even though the various parties essentially claimed credit for yet-unproven cost containment measures (which are already assumed within the administration's budget projections). If it was so easy to shave 1.5 percentage points annually off the projected future rate of health cost growth, one might wonder why we didn't stumble across that magical solution last year or even earlier? Next, watch taxpayers and individual health care consumers get shortchanged amidst this interest-group brokering at the wholesale level.

Nevertheless, a little more Mo', if not Big Mo', has been added to Team Obama's push for a legislative blitzkrieg this summer.


Director of the Center for Health Policy Studies at the Heritage Foundation

The big guns of the health care industry -- representatives of doctors, hospitals, health plans, pharmaceuticals, medical technology and organized labor -- say they can achieve a stunning $2 trillion in savings in 10 years by pursuing, among other things, fashionable health policy initiatives: adopting administrative simplification, standardization, health IT, new "quality" initiatives, coordinated care, disease management, promoting wellness and disease prevention.

Nice ideas, and they strongly resemble initiatives found in Obama's budget. But none would change the structural deficiencies -- the tax treatment of health insurance or Medicare financing -- that drive higher costs. Though it is impossible to tell without a serious econometric analysis, they would probably offset only a fraction of the real costs of a health care reform bill.

The success or failure of health reform does not depend on high-powered lobbyists, but on how these details of reform will be received by Americans sitting around their kitchen tables.

© 2009 The Washington Post Company