Health Care Groups Outline Ways to Attack Costs

By Staff Report

Jun. 2, 2009

The American Hospital Association told President Barack Obama on Monday, June 1, that it would focus on short- and longer-term measures, as well as initiatives that require commitment from a host of other providers, in order to help reduce overall annual health care expenditures during the next 10 years.

In a 28-page letter sent to the White House and backed by five other health care groups, the AHA said it would immediately focus on reducing common infections from surgeries.

Longer term, the association said it would encourage its members to improve how care is coordinated, use a variety of health information technology tools and boost overall efficiency. Many initiatives require the participation of providers of care both at the bedside and elsewhere.

The steps are meant to be taken in concert with a host of other groups, including America’s Health Insurance Plans, the Advanced Medical Technology Association, the Service Employees International Union, the Pharmaceutical Research and Manufacturers of America and the American Medical Association.

In short, the groups Monday identified three main areas where savings can be realized. Those areas are in the utilization of care, where up to $180 billion in savings are projected; chronic-care management, which could yield $850 billion in savings; and administrative simplifications, which at the high end are predicted to save $700 billion.

On May 11, the coalition made a highly public pledge to the president himself to do their part in helping lower overall health care expenditures by more than $2 trillion over the next decade.

In the letter June 1, each group identifies a number of different areas where costs could be recouped.

For instance, AHIP said it would wring savings by moving toward a standardized and electronic way to deal with claims, submissions and payments.

The group also said it would create a Web portal that will allow physicians to conduct business with insurers through a singular Web site. And PhRMA said it would support a “well-designed” comparative-effectiveness program.

Meantime, the SEIU said it wants to see expanded efforts on the home care front, including bonus Medicaid payments to some states.

At least one key senator said he was unsure about the proposals.

“I’m skeptical that these proposals will add up to anywhere near $2 trillion. 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.”

Filed by Matthew DoBias of Modern Health Care, a sister publication of Workforce Management. To comment, e-mail

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