Health Care Debate: The Truth Is Out There
Democratic presidential candidates are throwing out big numbers as part of their plans to achieve universal health care and cost cutting. Meanwhile their Republican counterparts are making claims about market-based approaches to drive down health insurance prices.
To see whose if anyone’s numbers add up, we went to the health policy expert both sides often turn to, Professor Kenneth Thorpe, Chair of Health Policy and Management at Emory University's Rollins School of Public Health.
Claim: Using technology will help cut costs
Sen. Hillary Clinton, D-N.Y., and all of the Democratic candidates in fact, claim computerized health records will go a long way toward boosting efficiency and driving down costs.
“When we get electronic medical records -- something that I am working on, that I passed through the Senate last year -- we will save, it is estimated, $77 billion a year,” Clinton Clinton said at an AARP health forum in Iowa in September.
The Democratic frontrunner cites a 2005 Rand Corporation study’s estimate on savings. What Clinton doesn't say is, though, is that the study puts the price tag for achieving those savings at more than $100 billion.
The estimated cost to computerize the nation’s hospital records is $98 billion, and the cost to computerize doctor’s offices is estimated at another $17 billion.
Democratic hopeful and former vice presidential candidate John Edwards touts even bigger savings from the combination of preventive care, chronic disease management and technology.
"My proposal actually saves $120 billion to $130 billion a year by doing all those things,” Edwards says. “It has preventive care, chronic care, long- term care covered; requires electronic record keeping; requires the use of technology.”
Verdict: The Truth is Out There
The verdict on Clinton's and Edwards' claims from Emory University's Ken Thorpe is that they are mostly true -- they'll achieve savings -- eventually.
“The timing of when the costs come in, and the timing of when the savings happen are going to occur at different points,” says Thorpe, the chair of Emory’s Department of Health Policy and Management.
Claim: Cutting Insurance Mandates Will Cut Costs
GOP candidate Rudy Giuliani’s plan also touts preventive care, but he also takes aim at deregulation Giuliani claims that cutting some 3,900 state insurance mandates will go a long way to making insurance more affordable.
“Right now there are 45 million without insurance,” Giuliani said at a hospital event in Norwak, Conn., in July. “A lot of those people could afford insurance, except they can't afford insurance at the high prices, as they now exist.”
Another GOP candidate, Mitt Romney, has also proposed deregulation as way of making insurance more affordable.
Verdict: Sizable One-Time Savings
Ken Thorpe says it could mean big savings in the near term.
"In the market place you'd see a reduction of 5 to 10 %, which is not trivial," Thorpe said. "It would be a one-time savings."
With total health care spending in the U.S. topping $2 Trillion in 2006, a 5 to 10 % cut in costs amounts to $100-200 Billion in savings. Certainly not trivial, but Thorpe says the change would not provide recurring savings.
Claim: Reform Doesn’t Require More Spending
As Governor, Mitt Romney helped bring about a universal health care plan in Massachusetts, but does not advocate a federal version of the Bay State's plan. Instead, Romney wants to let states come up with their own health care plans, allowing them to redirect federal money they already receive to cover the uninsured.
“The reforms I led in Massachusetts and the federalist reform plan I recently proposed do not raise taxes or increase spending,” Romney wrote in a recent Op-Ed in the Wall Street Journal.
Verdict: Reform Takes Money
Emory University's Ken Thorpe says Romney is right to say the Massachusetts plan would not work for everyone, but not when it comes to boosting care for the uninsured using current federal funding to states.
"A couple of states might be able to do this, but most states would not have sufficient funding," Thorpse says.
Massachusetts is one of a handful of states that receive large payments under the Medicaid federal grants, Thorpe says, which helped to bring about universal coverage in the Bay State. In addition, Massachusetts had a 10% unisured rate, while states like Texas and California have rates that are closer to 20%.
For Romney's federal plan to work, Thorpe says new federal funds would need to be added to help states extend coverage to the uninsured.