Health Promises vs. Hard Choices

Article excerpt

Potomac Sources

It's easy to talk about improving healthcare coverage and helping the uninsured. The hard stuff, though, is controlling healthcare costs, a topic few want to address honestly. Everyone can agree that the United States spends too much for healthcare - much more than any other country and without significantly better results in health and longevity.

One of President Obama's promises is to cover many of the 47 million Americans who lack health insurance. That could add $100 billion or more a year to the annual tab for spending on health, now estimated at $1.6 trillion a year. He also said he would figure out ways to lower the cost of a typical health insurance policy by $2,500 a year per family.


Worthwhile as those goals seem, nobody has seen any details, yet. When the Obama's team and Congress try to map out a plan, they're likely to learn some painful lessons about our healthcare system. Every dollar they will seek to save in health spending represents income for businesses, individuals, doctors and hospitals - as well as treatments for the public. It's hard to cut without generating angry, determined opposition.

The need to control spending is apparent. The Congressional Budget Office (CBO), in a report issued in December, warned that total spending on healthcare is projected to climb from 16% of our total economic output (the Gross Domestic Product, or GDP) to 25% by 2025, and nearly 50% by 2082. Imagine - half of all the United States produces would be spent on caring for our health.

Medicare and Medicaid now consume about 4% of GDP, and that figure is projected to reach about 20% by 2082. That's obviously unsustainable. Historically, the federal government takes about 20% of the GDP for all its activities, from Social Security to defense to highways to interest on the national debt.

At this critical juncture, it's important to look at ways to break the pattern of ever-increasing spending. This conclusion will be evident to anyone who looks at the new CBO report, the most comprehensive menu to date of healthcare options from potential savings. Studying this analysis would be worthwhile for anyone worried about these trends. CBO offers a menu of 115 options dealing with healthcare outlays.

Following are some of the options outlined in the CBO study.

Hospital readmissions : Of those who go to a hospital under Medicare, 18% are readmitted within 30 days. Some hospitals have much higher readmission rates than others, and many readmissions could be prevented, the report said. Hospitals would be penalized and receive less money for taking care of readmitted patients when their readmission numbers exceed the national average.

Supporters of this idea say it would force hospitals to improve the quality of care. Opponents say, "Patients may have experienced complications or relapses that were beyond the hospitals' control; therefore, some portion of those readmissions were probably tinavoidable," according to 's report.

Cutting hospital readmissions could save the federal government $10 billion between 2010 and 2019, CBO estimates.

Electronic technology: Another option is having all hospitals and doctors buy a standard electronic health record-keeping system. CBO says, "For physicians, the standard package would include, example, clinical notes with medical history and follow-up, computerized physician order entry for diagnostic and other services, electronic prescribing, management of diagnostic testing results and clinical decision support For hospitals, the standard package would most likely include clinical systems for the major anciliary services (laboratory, pharmacy, and radiology), a clinical data repository, clinical documentation."

Advocates say new technology would improve the quality of care. But requiring it would impose a financial burden on hospitals and doctors. "In particular, many small practices would be hard-pressed to find the financial resources to purchase a health IT system," CBO said. …