Reducing The Deficit By Reforming Health Care
The health care industry acknowledged some basic problems in the U.S. health care system this week, offering to cut $2 trillion in spending reductions over the next decade to help pay for President Barack Obama’s plan to reform the health care system and offer medical insurance to all Americans. [AP]
By Christy Harvey, Mic Check Radio
May 12, 2009
(AP/Gerry Broome)
The health industry findings echoed those in a new report by the Center for American Progress Action Fund. That report found “many of the problems in the U.S. health care system come from the antiquated way in which we deliver care. Most of what is done in medicine was developed in the past few decades, yet it is delivered in doctors’ offices that haven’t changed in decades and with payment systems designed 50 years ago. The result is flawed care: Many patients fail to receive adequate care, receive too much care, or receive care in the wrong way.”
The report also called for reform in four areas: “investing in infrastructure; measuring what is done and how well it is performed; rewarding high-value care, not just high-volume care; and realigning consumer incentives to encourage better health behavior.” [CAP Action Report]
Know Five Things
1. Lack Of Insurance For Some Drives Up Costs For All
A recent report from The Wonk Room concludes that a failure to continuously cover all Americans accounts “for roughly 8 percent of the average health insurance premium.”
From the report: “This cost-shift amounts to $1,100 per average family premium in 2009 and $410 per average individual premium. By 2013, assuming the cost shift remains the same percentage of premium costs, the cost shift will be approximately $480 for an individual policy and $1,300 for a family policy. [American Progress Action Fund]
2. The Current System Is Expensive
Health care currently accounts for 16 percent of GDP, and that share is forecast to nearly double in the next quarter century. [CAP Action Report]
According to a new study from the Robert Wood Johnson Foundation, people with insurance are less able to afford it. “Nationwide, average costs paid by an employee for an individual health insurance premium have risen nearly eight times faster than average U.S. incomes.”
Here are the stats: “Average costs for an individual insurance policy have increased 61 percent—from $2,560 in 1996 to $4,118 in 2006. Nationwide, the amount that employees pay for an individual policy has increased 79 percent, with wages in the U.S increasing just 10 percent over the period.” [Robert Wood Johnson]
3. The Current System Isn’t Efficient
According to estimates, “a third or more of medical spending—perhaps $700 billion per year—is not known to be worth the cost.”
Also, studies by Elliott Fisher and colleagues suggest that about 30 percent of the medical services provided in the United States are not associated with improved health. [CAP Action Report]
4. Effect On American Families
According to a recent poll by the Kaiser Family Foundation, “Slightly more than half (53%) of Americans say their household cut back on health care due to cost concerns in the past 12 months. The most common actions reported are relying on home remedies and over-the-counter drugs rather than visiting a doctor (35%) or skipping dental care (34%). Roughly one in four report putting off health care they needed (27%), one in five say they have not filled a prescription (21%) and one in six (15%) say they cut pills in half or skipped doses to make their prescription last longer.” [Kaiser Family Foundation]
5. Health Reform Saves Money
According to a new report by Dr. David Cutler, Harvard economist, health care modernization would save the federal government $600 billion in health spending over the next decade and $9 trillion over the next 25 years. [CAP Report]
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