President Obama will announce Monday that he has secured the commitment of several industry groups to do their part to rein in the growth in health care costs. This pledge from the private sector could reduce the growth in health care spending by 1.5 percentage points a year, for a savings of $2 trillion over 10 years, a letter from the groups will promise, according to a senior ad
ministration official. Overall, it could amount to a 20% reduction in the growth of health care spending. Six trade associations representing unions, hospitals, insurers and the drug industry have signed on to the commitment. However, the savings depend in part on Congress passing health care reform this year. And it was not clear how these savings would be accomplished. An official pointed to possible savings from "administrative simplification," smarter care coordination, and changing incentives so providers are rewarded for providing "better" care, as opposed to "more" care. Hospitals are now "financially penalized for providing more efficient care by current law," the official said. The official also said savings could come from the bundling of payments, in which hospitals, doctors, insurers and other health care companies would work together to bill one fee for one treatment. The Obama administration is positioning health care reform as critical for getting the deficit under control; for freeing up resources for other initiatives, such as education; and for reducing the burden on American families. Under the plan to be announced Monday, in five years, the average family of four could be saving $2,500 in health care costs annually, the official said. Given the failed health care reform efforts of the 1990s, the White House's Monday press conference aims to get ahead of potential detractors.
ministration official. Overall, it could amount to a 20% reduction in the growth of health care spending. Six trade associations representing unions, hospitals, insurers and the drug industry have signed on to the commitment. However, the savings depend in part on Congress passing health care reform this year. And it was not clear how these savings would be accomplished. An official pointed to possible savings from "administrative simplification," smarter care coordination, and changing incentives so providers are rewarded for providing "better" care, as opposed to "more" care. Hospitals are now "financially penalized for providing more efficient care by current law," the official said. The official also said savings could come from the bundling of payments, in which hospitals, doctors, insurers and other health care companies would work together to bill one fee for one treatment. The Obama administration is positioning health care reform as critical for getting the deficit under control; for freeing up resources for other initiatives, such as education; and for reducing the burden on American families. Under the plan to be announced Monday, in five years, the average family of four could be saving $2,500 in health care costs annually, the official said. Given the failed health care reform efforts of the 1990s, the White House's Monday press conference aims to get ahead of potential detractors.For further details visit at :money.cnn.com/2009/05/10/news/economy/obama_healthcare_reform/?postversion=2009051021
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