Health Care Industry Groups Outline Cost-Control Proposals
On Monday, six health care industry groups provided the Obama administration with a 28-page detailed proposal that aims to reduce health care spending by between $1 trillion and $1.73 trillion over 10 years, The Hill reports.
Last month, the groups promised the administration that they would help reduce the annual health care spending growth rate by 1.5 percentage points. The groups include the:
- American Medical Association;
- American Hospital Association;
- Pharmaceutical Research and Manufacturers of America;
- Advanced Medical Technology Association;
- America's Health Insurance Plans; and
- Service Employees International Union (Young, The Hill, 6/1).
The recommendations reflect some ideas being considered by Congress and include efforts to reduce hospital readmission rates, spur the use of health information technology and promote the use of comparative effectiveness research (Budoff Brown, Politico, 6/1).
The groups suggested that:
- Improving chronic disease management could save between $350 billion and $850 billion;
- Avoiding duplicate and unnecessary treatments could save $150 billion to $180 billion; and
- Streamlining administrative duties could save as much as $700 billion (Smith, Reuters, 6/1).
AHIP proposed eliminating paperwork by standardizing claim submissions, eligibility, claims status, payments, and remittance forms, and making them available through online regional or state portals for health care providers (Edney, CongressDaily, 6/2).
In addition, AMA recommended reducing "unnecessary utilization" of practices such as caesarean sections, back-pain management, prescriptions for sinus infections and diagnostic imaging tests (Adamy, Wall Street Journal, 6/1).
According to AMA, c-sections account for 45% of the more than $79 billion in annual hospital charges for childbirth (Reuters, 6/1).
AHA Weighs In
AHA said it will launch a national campaign to expand upon quality improvement efforts underway at hospitals nationwide.Â The campaign will include efforts to reduce:
- Surgical infections and complications;
- Pressure ulcers; and
- Adverse drug events from high-hazard medications (Simmons, HealthLeaders Media, 6/2).
It is unclear how many of the proposals would be enforceable.
In a letter accompanying the recommendations, the groups said, "Some of these proposals can be achieved under current law," and the "success of others will depend upon good public policy," adding that "we will work very hard to see them implemented" (Politico, 6/1).
David Nexon, an executive with AdvaMed, said, "We're supporting legislation that will do the job" of enacting some of the recommendations as law (Armstrong, CQ Today, 6/1).
On Monday, Senate Finance Committee ranking member Chuck Grassley (R-Iowa) released a statement saying he is "skeptical that these proposals will add up to anywhere near $2 trillion" (Wall Street Journal, 6/1). He said, "In the legislative process, proposals rise or fall based on what [the Congressional Budget Office] says about them, and the same will be true here."
Also on Monday, House Ways and Means Committee ranking member Dave Camp (R-Mich.) asked CBO to produce cost-savings estimates for the proposals.According to CongressDaily, CBO has had difficulty scoring health reform proposals because of the lack of information about real-world application of reform plans, particularly preventive efforts (CongressDaily, 6/2). This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.