Payers, Trade Groups and Physicians Pledge to Curb Growth of Healthcare Costs
BY LAUREN UZDIENSKI, MAY 12, 2009
President Obama is moving ahead with U.S. healthcare reform, and yesterday he provided an overview of part of his plan with a coalition of insurers, industry groups and physicians behind him. During the 1990s, President Clinton's push for a healthcare overhaul faltered due to industry opposition, so this support represents a critical step in mobilizing Congress to pass the legislation.
Obama has previously outlined his goals for healthcare, including providing universal coverage, expanding healthcare IT and increasing efficiency. Yesterday's announcement focused on slowing the growth of healthcare costs, which are currently over 16% of the GDP and climbing. In 2007, healthcare spend grew 7% over the prior year, and at current rates, healthcare will be 21% of the GDP in 2019. However, if providers go along with the president's plan to cut 1.5% from the growth rate every year, the savings could add up to $10 trillion over the next decade and contain healthcare spend such that it will be only 18% of the GDP by 2019. Per White House officials, savings could come from more efficient payment systems more efficient and lowering administrative costs.
Among the organizations who have voiced support for these changes are AdvaMed, the American Hospital Association, the American Medical Association, America's Health Insurance Plans and the Service Employees International Union.
There are is nothing in place that will hold coalition members to their word, though the unprecedented public support does set a tone for change that could come rather quickly. President Obama has previously stated that he expects to sign a reform package into law this summer.
