President Obama, in his latest push to shore up healthcare, has stated that he expects a plan from Congress by July 31 that will overhaul the current healthcare system.  Obama, making good on one of his campaign promises, has proposed to reduce the ballooning costs of healthcare, guarantee the right to choose health plans and medical providers, and ensure all Americans have access to affordable coverage.  While Obama’s intentions for healthcare overhaul are sound, the President has left the details of the plan to Congress.  Proposals are working through both the House and the Senate, but with the sheer amount of interior and partisan opposition, it could be a while before the House or the Senate can agree on even the smallest details.

Obama’s recent push comes on the heels of an announcement that the President had secured the support of medical providers to reduce the cost of healthcare over the course of the next decade.  In a letter to President Obama, a number of private stakeholders representing physicians, healthcare workers, suppliers, manufacturers, and organized labor pledged to do their part to decrease the annual healthcare spending growth rate by 1.5% over the next decade.  If accomplished, this would represent a 20% reduction in the projected rate of growth and result in savings of $2 trillion or more.  But when a President pledges to save $2 trillion, even one as popular as Obama, people are bound to be skeptical. 

While the recession that begun in December 2007 stemmed from sub-prime mortgage loans and the housing crisis, several prominent economists predicted a greater economic crisis down the road as healthcare costs swelled to astronomical levels.  In the not so distant future, affordable healthcare would become unheard of as millions bankrupted themselves to receive medical aid.  Obama sought to address this issue during his campaign, with a pledge of “affordable healthcare for all Americans”.  However, Obama provided few details on how this plan would come to fruition while on the campaign trail.  With the backing of medical providers, it seems the President has taken the first step.

Even still, with a number like $2 trillion, skeptics are wondering how this could happen as the U.S. population continues to increase and more and more seniors from the Baby Boom generation require extensive healthcare.  If the healthcare industry could offer $2 trillion in savings without lifting a finger, wouldn’t the implication be that medical providers had been stealing from consumers all this time?  With the rising costs of healthcare for people of all ages and medical needs, that assumption is foremost on the minds of a number of Americans.  But in truth, the healthcare industry is not quite as devious as some perceive. 

Obama believes that by increasing the quality of the healthcare Americans receive, big savings are possible.  Obama’s confidence stems from a research study conducted over the last couple decades at Dartmouth.  Jack Wennberg and Elliott Fisher, the leaders of a research team called the Dartmouth Atlas of Health Care, discovered interesting evidence when researching health care spending patterns in various regions across the United States.  The researchers discovered that there were significant variations in healthcare spending in different cities, states, and regions of the U.S. (as would be expected), however, there was no justifiable reason as to why one area spent more than another.  The researchers compared demographics, income levels, and environmental factors that could have attributed to the increased spending, and found that none of these factors provided a logical explanation as to the differences. 

Even more puzzling than the unexplained variations in healthcare spending were findings that the areas that spent the most on healthcare didn’t have better results in terms of patient health.  Patients living in the regions of the U.S. where spending was highest received more testing and spent more time in the hospital, but were not healthier because of it.  Obama noted this research, and has used it to champion the healthcare overhaul under the belief that by increasing the quality of care patients receive, Americans can save a lot on healthcare costs.  Obama cited simple preventative practices that could translate to savings including medical records that would be transparent to all caregivers, ensuring patients follow the prescriptions for their medication, and more informed doctor diagnoses. 

Medical providers agree with the President about preventative medicine.  The numerous groups that signed the letter pledging to reduce healthcare costs also said:

Billions in savings can be achieved through a large-scale national effort of health promotion and disease prevention to reduce the prevalence of chronic disease and poor health status, which leads to unnecessary sickness and higher health care costs.

Obama pledged to save the average American family $2,500 on their health care costs in his first term, and now it’s on Congress to put Obama’s vision on paper.  Despite the standard initial partisan opposition, House Republican leaders released a letter to Obama requesting a meeting on healthcare.  Republicans criticized the Democrat approach to healthcare, but some Republican leaders expressed a desire to meet on common ground with the President.  This common ground included such practices as protecting consumers, preserving the patient’s right to choose, and encouraging preventative care.  While the two parties in the Capitol aren’t singing the same tune, it’s encouraging that some are willing to see eye to eye on specific issues.

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