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Life Health > Health Insurance

HIAA Offers Five-Step Program For Cutting Health Costs

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NU Online News Service, June 3, 2003, 4:55 p.m. EDT — Washington

The United States could cut health care costs by about $250 billion per year by adopting a five-step cost-containment strategy, according to a new report from the Health Insurance Association of America, Washington.

“There is a path to significant savings if we have the political will and the commitment of all parties-in-interest,” Dr. Donald Young, president of HIAA, said today at a press briefing about the report.

The HIAA report recommends that the country hold down health care costs by pruning red tape, reforming medical malpractice rules, promoting standards, giving consumers more control over health care decisions, and stopping public health programs from shifting costs to private payers.

HIAA estimates that simply clearing away benefit mandates, onerous prompt-payment rules and other legislative and regulatory burdens on health insurers could save between $20 billion to $25 billion each year, and that reforming the medical malpractice system could save between $78 billion and $133 billion.

In addition to increasing medical malpractice insurance rates, fear of lawsuits increases medical costs about $50 billion per year, by encouraging defensive medicine, HIAA says.

HIAA predicts that promoting the use of scientific medical standards and independent evaluations of new medical technology could save another $100 billion per year.

HIAA does not try to quantify the effects of giving consumers a greater stake in health care decisions, but it says ending cost-shifting by public health programs would save $15 billion each year.

Ideas about cutting costs are particularly important this year: privately insured adults and adults in general now view controlling health care costs as the top health care priority, according to Bill McInturff, a partner with the polling firm of Public Opinion Strategies, Alexandria, Va.

McInturff reported at the press briefing that 39% of adults with private health insurance who participated in a recent survey cited cost control as the number one issue for Congress and the President to address. In contrast, only 23% listed reducing the number of uninsureds as the number one issue, and only 5% listed passing a patients’ bill of rights as the top priority.


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