Health care industry promises Obama that they will cut price increases

On Sunday, May 10, White House officials said chief groups in the health care industry have proposed to cut $2 trillion in savings from predicted cost surges during the next ten years. This pledge arises out of the debate on how, or if the nation’s health care system should be renovated.

By using new regulations, the industry groups want to shave the rise in health care costs by 1.5 % a year. This would greatly affect the national economy and the federal budget, which are both substantially affected by health care expenses.

On Monday, May 11, representatives from 6 health industry trade groups will make an offer at a White House meeting with President Obama.

Projections from the White House indicate that after 5 years, the savings could mean about $2,500 annually in lower health care bills for a family of four. Supposedly, during this 10 years, the savings would possibly put an end to the national budget deficit.

Even though these are such healthy forecasts, many components of the plan are quite vague. The groups have not indicated in detail the strategies they intend to perform to get to their goal; they presented a nonspecific letter to Obama, which wasn’t an actual contract.

There is no sure way to make sure that the groups will make good on their promises, and keeping track of the savings will be complicated, according to White House officials. This said, White House officials were positive about the proposal from officials in the industry, who have tried to stop health care reform in the past.

The American Medical Association, the Pharmaceutical Research and Manufacturers of America, America’s Health Insurance Plans and the Service Employees International Union, are among the trade groups that are making the proposal. This offer is their most recent tactic to insure a seat at the bargaining table. Meanwhile, Democrats contemplate regulations that could keep costs in check and provide coverage to millions of uninsured Americans.

In 1993, a comparable reform plan by President Bill Clinton was opposed by drug-makers, insurers, hospitals and the American Medical Association. Since then, dramatic health care costs have stifled pay raises for most workers and weakened profits for many businesses.