More Efficient, Broader HealthCare Coverage Sought

Govt Wants Medical Spending Slashed June 13, 2009 (National News - Social Security)

Washington – President Barack Obama has expressed desire to overhaul the healthcare system by reducing Medicare and Medicaid spending as he urged lawmakers to pass new laws.

The chief executive said the high health care costs had drastically affected the economy. To carry out his reforms, Obama proposed cutting down $313 billion from the two programs over the next 10 years. The federal trimming of payments will include payments to hospitals by about $200 billion.

Earlier, the President said the nation must explore ways to reduce the number of unnecessary medical tests or procedures that sometimes are conducted to stave off possible malpractice lawsuits, which would appear unfair to patients

However, he said, "we need to explore a range of ideas about how to put patient safety first, let doctors focus on practicing medicine, and encourage broader use of evidence-based guidelines. That's how we can scale back the excessive defensive medicine reinforcing our current system of more treatment rather than better care."

In his weekly radio and Internet address, the President said these changes – which he called “commonsense changes”- in the healthcare system will be justified by greater efficiency and broader insurance coverage in the future. He focused on payments to Medicare and Medicaid, which cover millions of elderly and low-income people and involve thousands of doctors, hospitals, nursing homes and other institutions.

The proposal is part of a bigger plan that would provide $948 billion over a decade in savings or tax increases that would help insure everyone and the slow the rate of rising health care costs. The proposal would also include cutting $106 billion from payments to hospitals that help treat uninsured people. Spending on Medicare prescription drugs is also expected to fall by $75 billion over the next ten years.

The President also said that reducing Medicare payments to hospitals and other providers – (but not doctors) would save $110 billion in ten years.

The president wants to cut $106 billion over 10 years from payments that help hospitals treat uninsured people. Spending on Medicare prescription drugs would fall by $75 billion over a decade. In addition, the leader also wants to reduce government payments for services and devices such as MRI and CTI equipment. He said the equipments are used frequently and efficiently and urged providers to spread the costs over many patients with less government reimbursement.

Obama wants to reduce government payments for such services. He said devices such as MRI and CTI equipment are used so frequently and efficiently that providers can spread their costs over many patients, requiring less government reimbursement.He acknowledged however, that details of the changes must first be resolved.

Experts said that even if the health care savings of $948 billion is reached in ten years, it is still insufficient to cover the entire nation’s uninsured. They said the cost could range from $1.2 to $1.8 trillion, depending on factors such as the amount of federal subsidies.

Other proposals are being suggested in Congress and Senate and the President stressed that the plan must not add to the federal deficit.

Peter Orszag, the Presidents’ budget director said that $949 billion "is in the ballpark of many of the proposals floating around," and that "there may well be some additional resources that are necessary." He said the administration will work with Congress to resolve the issue.