Health Groups Give Obama Details on Cost-Cutting Measures

 An interesting letter to President Obama by industry trade groups proposing to reduce cost and achieve greater efficacy within the healthcare system. It is very high level and simply points out categories of spend that need to be attacked. The question remains – Can a fragmented group of doctors, hospitals, insurers and pharmacuetical associations come together to self impose cross entity discipline? The proof will be in the pudding.

Health Care Financial Management Association

 

In a letter to President Obama today, six healthcare groups outlined specific initiatives they said would fulfill the pledge they made a month ago to help “achieve your Administration’s goal of decreasing by 1.5 percentage points the annual health care spending growth rate—saving $2 trillion or more.” The six organizations—the American Hospital Association, American Medical Association, America’s Health Insurance Plans, Advanced Medical Technology Association, Pharmaceutical Research and Manufacturers of America, and Service Employees International Union—said that their proposed system-wide cost reductions, which “will require collaboration and good public policy,” have the potential to save $150 to $180 billion on utilization of care; $350 to $850 billion on chronic care; and $500 to $700 billion on administrative simplification and cost of doing business.

Each group presented its own initiatives to contribute to the overall cost savings. The American Hospital Association said it was committed to designing and implementing a national “Hospitals in Pursuit of Excellence” campaign, which would focus on hospital performance improvements that “have meaningful quality improvement and associated cost savings.” Immediate cost savings could be achieved, according to the AHA, by promulgating best practices that would reduce surgical infections and complications, central line-associated blood stream infections, ventilator-associated pneumonia, catheter-associated urinary tract infections, adverse drug events, and pressure ulcers. The AHA also listed longer-term goals that hospitals would work towards, including “improving care coordination, implementing health information technology, promoting efficiency resource utilization, preventing patient falls, improving perinatal care, and reducing supply costs.”

The AHA said it would work with “other stakeholders to achieve a more efficient, effective and coordinated health care system. The future vision of such as system includes simplified and standardized public and commercial insurance processing systems, reducing the need to practice defensive medicine and enhancing the ability of practitioners and providers to integrate clinically to improve quality of care.

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