A 'watershed event' for health care reform

In a letter to the President that was followed by a White House meeting May 11, health care organizations pledged to do their part to decrease the annual health care spending growth rate by 1.5% over 10 years —a projected savings of $2 trillion or more.

What "doing their part" means in terms concrete, measurable initiatives remains to be seen, but in prepared remarks delivered after meeting with the organizations, President Barack Obama said called it "a historic day, a watershed event in the long and elusive quest for health care reform."

The Advanced Medical Technology Association, American Medical Association, AHIP, PhRMA, American Hospital Association and Service Employees International Union outlined actions such as focusing on administrative transparency, quality and efficiency incentives, encouraging coordinated care and improving delivery models as ways to cut costs, but did not provide specific details.

Obama was also pleased that the initiative will help him keep a campaign promise to save families an average of $2,500 on their upcoming health care costs. "The steps that are being announced today are significant," he said. "But the only way these steps will have an enduring impact is if they are taken not in isolation, but as part of a broader effort to reform our entire health care system."

Although she has no delusions that this offering will put an end to public plan talks, Janet Trautwein, EVP and CEO of NAHU, believes the stakeholders' proposal "will go a long way towards preventing [a public plan] from becoming a reality."