Newt’s six-point health-care reform

Barack Obama likes to accuse his critics on health-care reform of proposing nothing in opposition to ObamaCare.  Newt Gingrich and Nancy Desmond run the Center for Health Transformation and have their own response, a six-point plan to reform health care and lower costs, without spending trillions of dollars to do it.  The CHT plan offers some similarities to ObamaCare, and some key differences:

1. Stop Paying the Crooks. First, we must dramatically reduce healthcare fraud within our current healthcare system. Outright fraud — criminal activity — accounts for as much as 10 percent of all healthcare spending. That is more than $200 billion every year. Medicare alone could account for as much as $40 billion a year. (Read about our latest CHT Press book, Stop Paying the Crooks, edited by Jim Frogue.)
2. Move from a Paper-based to an Electronic Health System. As it stands now, it is simply impossible to keep up with fraud in a paper-based system. An electronic system would free tens of billions of dollars to be spent on investing on the kind of modern system that will transform healthcare. In addition, it would dramatically increase our ability to eliminate costly medical errors and to accelerate the adoption of new solutions and breakthroughs.
3. Tax Reform. The savings realized through very deliberately and very systematically eliminating fraud could be used to provide tax incentives and vouchers that would help cover those Americans who currently can’t afford coverage. In addition, we need to expand tax incentives for insurance provided by small employers and the self-employed. Finally, elimination of capital gains taxes for investments in health-solution companies can greatly impact the creation advancement of new solutions that create better health at lower cost.
4. Create a Health-Based Health System. In essence, we must create a system that focuses on improving individual health. The best way to accomplish this is to find out what solutions are actually working today that save lives and save money and then design public policy to encourage their widespread adoption. For example, according to the Dartmouth Health Atlas, if the 6,000 hospitals in the country provided the same standard of care of the Intermountain or Mayo health clinics, Medicare alone would save 30 percent of total spending every year. We need to make best practices the minimum practice. We need the federal government and other healthcare stakeholders to consistently migrate to best practices that ensure quality, safety and better outcomes.
5. Reform Our Health Justice System. Currently, the U.S. civil justice system is the most expensive in the world — about double the average cost in virtually every other industrialized nation. But for all of the money spent, our civil justice system neither effectively compensates persons injured from medical negligence nor encourages the elimination of medical errors. Because physicians fear malpractice suits, defensive medicine (redundant, wasteful treatment designed to avoid lawsuits, not treat the patient) has become pervasive. CHT is developing a number of bold health-justice reforms including a “safe harbor” for physicians who followed clinical best practices in the treatment of a patient. Visit CHT’s Health Justice project page to learn more.
6. Invest in Scientific Research and Breakthroughs. We must accelerate and focus national efforts, re-engineer care delivery, and ultimately prevent diseases such as Alzheimer’s Disease and diabetes which are financially crippling our healthcare system.

Be sure to read it all, but there are a couple of points worth mentioning in this plan.  First, the “safe harbor” provision sounds as though it will take a different approach than Obama’s IMAC in imposing a best-practices policy on the health-care industry in theory, but in practice it amounts to the same thing.  It proposes an Advisory Panel that will create a standard approach to diagnosis and treatment that doctors will have to follow in order to avoid massive penalties; in ObamaCare, it would be suspension of payment, and in CHT, it would be liability to malpractice suits.  Either approach will mean that doctors have to hearken to a small cadre of elites in Washington on individual treatment of patients, a system which assumes that a one-size-fits-all treatment model would work for everyone.  If the specifics of your individual condition mean that approach won’t work, you will need to find a doctor willing to forego payment or assume a big liability risk. It would be better to pursue an overall tort reform that allows people to gain compensation for real losses while eliminating the out-of-control punitive awards that create the defensive approach that wastes so much money in American health care.

That also applies to having the federal government lead the best-practices effort.  It makes it a very small step from a “best practices” advisory group to a federal agency that imposes those decisions on providers.  Call me a skeptic, but the federal government is hardly a model for best practices anyway.  That effort belongs in the free market, which could be incentivized by tax policy.

The emphasis on electronic records as a reform seems exaggerated.  Many providers have long since gone to electronic record-keeping, especially for billing, which is what CHT proposes.  If that has resulted in massive reductions in fraud, we have seen little evidence of it.  It’s not a bad goal to pursue for efficiency, but even then the prospects for significant savings — in relation to the overall costs borne in the health-care system — seem pretty small.

Newt says that Alzheimers and diabetes are crippling our health-care system, which is not quite accurate.  It’s crippling government programs, certainly, and costing a fortune for families.  Aging, however, is the biggest cost driver for Medicare/Medicaid, which is why Alzheimers has become such a problem; the population has skewed older with the baby boomers, and we’re seeing higher rates for both diseases because of the population distribution (for diabetes, only in part).  As people get older, they require more medical care, and so this should not be a big surprise.  We already spend billions of dollars in federal research on a wide range of diseases, notably cardiology, as heart disease is still the biggest cause of death in America. Wiser spending and a better sense of discretion might do better here.

The CHT proposal is very intriguing, and Republicans could incorporate much of it into their own health-care reform offerings.  Some of this seems a little too close to ObamaCare for comfort.

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