Coalition Pledges to Cut Rise in Health Care Costs by $2 Trillion

Leaders of several health care and labor organizations met with President Obama at the White House and proposed ideas to reduce the growth in health care costs by as much as $2 trillion over the next decade.

In a letter sent to the president, the six organizations—the American Medical Association, the American Hospital Association, the Pharmaceutical Research and Manufacturers of America, the Advanced Medical Technology Association, America's Health Insurance Plans, and the Service Employees International Union—vowed to work as a group to help achieve the cost reduction. Among their proposals:

▸ Cutting costs by focusing on administrative simplification, standardization, and transparency;

▸ Reducing overuse and underuse of health care by aligning incentives so that physicians, hospitals, and other providers are encouraged to work together toward the highest standards of quality and efficiency;

▸ Encouraging coordinated care and adhering to evidence-based best practices and therapies that reduce hospitalization and manage chronic disease more effectively;

▸ Implementing proven prevention strategies; and,

▸ Making improvements in care delivery, health information technology, workforce development, and regulatory reforms.

The American Medical Association told the president that although evidence-based guidelines will be helpful in reducing costs, the reductions could be enhanced if physicians had more liability protection. “If everyone who walks into the emergency room gets an MRI for a headache, it's a costly procedure,” AMA president-elect Dr. J. James Rohack said. “In some areas of the country [that test has] been done because people sued when they didn't get the test. If we create scientifically based guidelines that say not everyone needs to have the MRI for a headache, physicians have got to have liability protection so they don't get sued if they follow that guideline.”

The president called the White House meeting historic. “[This is] a watershed event in the long and elusive quest for health care reform,” he said after the gathering. “And as these groups take the steps they are outlining, and as we work with Congress on health care reform legislation, my administration will continue working to reduce health care costs to achieve similar savings.”

“We are very cautious about the particulars of the voluntary effort that groups proposed to the White House,” said a statement from the National Coalition on Health Care. “Most of the measures that they cited would help to make the health care system more efficient over time, but, as the Congressional Budget Office has indicated, should not be counted on to produce substantial savings soon. … We are heartened by the sector's growing acceptance of responsibility to engage constructively in a search for solutions, but we believe that those solutions will need to be embodied in law.”

President Barack Obama meets with health care reform stakeholders at the White House May 11, 2009. OFFICIAL WHITE HOUSE PHOTO BY PETE SOUZA

Leaders of several health care and labor organizations met with President Obama at the White House and proposed ideas to reduce the growth in health care costs by as much as $2 trillion over the next decade.

In a letter sent to the president, the six organizations—the American Medical Association, the American Hospital Association, the Pharmaceutical Research and Manufacturers of America, the Advanced Medical Technology Association, America's Health Insurance Plans, and the Service Employees International Union—vowed to work as a group to help achieve the cost reduction. Among their proposals:

▸ Cutting costs by focusing on administrative simplification, standardization, and transparency;

▸ Reducing overuse and underuse of health care by aligning incentives so that physicians, hospitals, and other providers are encouraged to work together toward the highest standards of quality and efficiency;

▸ Encouraging coordinated care and adhering to evidence-based best practices and therapies that reduce hospitalization and manage chronic disease more effectively;

▸ Implementing proven prevention strategies; and,

▸ Making improvements in care delivery, health information technology, workforce development, and regulatory reforms.

The American Medical Association told the president that although evidence-based guidelines will be helpful in reducing costs, the reductions could be enhanced if physicians had more liability protection. “If everyone who walks into the emergency room gets an MRI for a headache, it's a costly procedure,” AMA president-elect Dr. J. James Rohack said. “In some areas of the country [that test has] been done because people sued when they didn't get the test. If we create scientifically based guidelines that say not everyone needs to have the MRI for a headache, physicians have got to have liability protection so they don't get sued if they follow that guideline.”

The president called the White House meeting historic. “[This is] a watershed event in the long and elusive quest for health care reform,” he said after the gathering. “And as these groups take the steps they are outlining, and as we work with Congress on health care reform legislation, my administration will continue working to reduce health care costs to achieve similar savings.”

“We are very cautious about the particulars of the voluntary effort that groups proposed to the White House,” said a statement from the National Coalition on Health Care. “Most of the measures that they cited would help to make the health care system more efficient over time, but, as the Congressional Budget Office has indicated, should not be counted on to produce substantial savings soon. … We are heartened by the sector's growing acceptance of responsibility to engage constructively in a search for solutions, but we believe that those solutions will need to be embodied in law.”

President Barack Obama meets with health care reform stakeholders at the White House May 11, 2009. OFFICIAL WHITE HOUSE PHOTO BY PETE SOUZA

Leaders of several health care and labor organizations met with President Obama at the White House and proposed ideas to reduce the growth in health care costs by as much as $2 trillion over the next decade.

In a letter sent to the president, the six organizations—the American Medical Association, the American Hospital Association, the Pharmaceutical Research and Manufacturers of America, the Advanced Medical Technology Association, America's Health Insurance Plans, and the Service Employees International Union—vowed to work as a group to help achieve the cost reduction. Among their proposals:

▸ Cutting costs by focusing on administrative simplification, standardization, and transparency;

▸ Reducing overuse and underuse of health care by aligning incentives so that physicians, hospitals, and other providers are encouraged to work together toward the highest standards of quality and efficiency;

▸ Encouraging coordinated care and adhering to evidence-based best practices and therapies that reduce hospitalization and manage chronic disease more effectively;

▸ Implementing proven prevention strategies; and,

▸ Making improvements in care delivery, health information technology, workforce development, and regulatory reforms.

The American Medical Association told the president that although evidence-based guidelines will be helpful in reducing costs, the reductions could be enhanced if physicians had more liability protection. “If everyone who walks into the emergency room gets an MRI for a headache, it's a costly procedure,” AMA president-elect Dr. J. James Rohack said. “In some areas of the country [that test has] been done because people sued when they didn't get the test. If we create scientifically based guidelines that say not everyone needs to have the MRI for a headache, physicians have got to have liability protection so they don't get sued if they follow that guideline.”

The president called the White House meeting historic. “[This is] a watershed event in the long and elusive quest for health care reform,” he said after the gathering. “And as these groups take the steps they are outlining, and as we work with Congress on health care reform legislation, my administration will continue working to reduce health care costs to achieve similar savings.”

“We are very cautious about the particulars of the voluntary effort that groups proposed to the White House,” said a statement from the National Coalition on Health Care. “Most of the measures that they cited would help to make the health care system more efficient over time, but, as the Congressional Budget Office has indicated, should not be counted on to produce substantial savings soon. … We are heartened by the sector's growing acceptance of responsibility to engage constructively in a search for solutions, but we believe that those solutions will need to be embodied in law.”

President Barack Obama meets with health care reform stakeholders at the White House May 11, 2009. OFFICIAL WHITE HOUSE PHOTO BY PETE SOUZA