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NAM: Rising Costs Threaten Health Benefits

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NU Online News Service, Sept. 4, 5:15 p.m. — Washington

The president of the largest U.S. manufacturers’ association warns that manufacturers will have to eliminate health care benefits unless health care quality and productivity improve.

“No issue is more critical to manufacturers than the rising cost of health care,” Jerry Jasinowski, president of the National Association of Manufacturers, Washington, said at recent press briefing. “Health care spending in America is out of control.”

Health care spending now accounts for 14% of U.S. gross domestic product, and some projections suggest that it could reach 20% of GDP by the end of the decade.

One of the primary causes of the price increases is lack of productivity in the health care sector, Jasinowski said.

Jasinowski cited one estimate that as much as one-third of health care spending pays for unnecessary, out-of-date and harmful services, and another estimate, from a recent Institute of Medicine report, that medical errors kill 100,000 U.S. residents each year.

“There is redundancy and waste in the system,” Jasinowski said.

Another speaker, James Maxwell, director of health policy and management research at John Snow Inc., Boston, said an aging population and advances in medical technology are also contributing to health care inflation.

Although new technology sometimes leads to better health, it is also very expensive, Maxwell said.

NAM has developed a seven-point program to attack health care cost inflation.

One point is a recommendation that the federal government start a new health care education program.

NAM is also proposing that the U.S. Department of Health and Human Services establish a clearinghouse for information about the quality of health care being delivered by various providers.

In addition, NAM is calling for increased employee participation in wellness and disease management programs; collaboration among manufacturers, hospitals and physician groups to reduce medical errors; financial incentives to encourage employees to chose health services in a cost-effective manner; and legislative restraint on health care mandates.


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