An adviser to Barack Obama discussed the Democratic presidential contender’s health plan this morning in a webcast produced by the Henry J Kaiser Family Foundation (a McCain adviser will be interviewed on Oct 16).

David Cutler, professor of Applied Economics at Harvard, warned that if present trends continue, US federal tax revenues will be spent entirely on Social Security and Medicare— the retirement and medical programmes for the elderly and people with certain chronic conditions.

Cutler estimated that Obama’s plan would cost the federal government US$50 billion to $65 billion annually, to be paid for largely by ending tax cuts President Bush enacted for individuals with annual incomes of $250 000 or more. All in all, a typical family of four would save about $2500 per year in medical costs under the plan, or roughly 8% of what it costs to cover that family today. At the same time, an Obama administration would lower medical costs by enlarging risk pools, and through investments in areas such as health-care infrastructure, public health, and preventive care. Doctors would be rewarded for good outcomes, and Medicare would offer incentive payments for activities such as following up with patients who miss appointments, electronic doctor-patient communication, and investing in information technology (IT). Indeed, IT would play a prominent role in Obama’s scheme. His team would have the federal government spend $50 billion to bring the USA up to speed. Much of that money would go towards helping smaller providers, such as community clinics, small group practices, and cash-strapped hospitals, invest in new IT systems. The importance of IT seems to be a rare area in which both candidates agree, because, according to Cutler, “John McCain’s heart also seems to be in electronic medical records”. 

The government is already nudging doctors toward incorporating more IT into their practices by offering bonuses to successful users of e-prescribing systems, beginning in 2009. On Tuesday, the Centers for Medicare and Medicaid Services (CMS) held a conference in Boston to promote this effort. In a press release, CMS noted that drug errors injure 1.5 million Americans annually. E-prescribing could help prevent these errors by warning of potential drug interactions, dosing problems, or duplications. The incentive payments will start at 2% and taper off to 0.5% by 2013. Prescribers who do not fulfill the standards by 2012 will see their payments go down. All in all, Medicare is expected to save $156 million over 5 years, just by avoiding adverse drug events. For more information about the conference, go to http://www.e-prescribeconference.com/.

Norra MacReady

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This entry was posted on Thursday, October 9th, 2008 at 1:02 pm and is filed under US Election. You can follow any responses to this entry through the RSS 2.0 feed. You can trackback from your own site.