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Editorial: Smiles, then hard talks

01:00 AM EDT on Thursday, May 21, 2009

That was a fine photo-op of health-care bigwigs gathered at the White House on May 11 and promising to go forth and find $2 trillion in health-care savings over 10 years. President Obama proclaimed “a historic day” and “a watershed event.”

Perhaps we will have to eat our skepticism, but let’s not plan on it. America’s history of health-care reform suggests that the likelihood of doctors, hospitals, drug makers and insurers voluntarily reducing their own revenue streams is rather small. Also small is the likelihood of many of those folks who have insurance tolerating any cutbacks, however reasonable, in their use of the latest expensive bells and whistles provided by the medical industry. (Some of these new treatments don’t work as well as the old ones, though the profit margin is a lot higher.) As long as someone else pays for most of it, they want it.

The only thing that will solve the health-care problem is a new set of enforceable rules. And designing those rules will be the job of lawmakers and the Obama administration, in consultation with the vested interests, of course.

Mr. Obama’s health-industry summit did put the proper emphasis on what most needs to be done — controlling costs. The other goal, covering the some 50 million uninsured, is the easier part. It just requires finding more money.

None of this will be easy but it won’t be impossible, given the enormous waste in our health-care system. Americans spend an average of $8,000 a year per capita on health care. This is twice the average spent by other rich countries, which have considerably better health outcomes than we do. There’s obviously room for restraining costs without compromising quality of care.

Among the ideas being floated is the controversial “public option,” a government-run health program that would compete with the private insurers’ plans. A carefully designed public plan would keep the private insurers honest without placing them on an uneven playing field. Insurers oppose the whole notion. We favor it strongly because it would improve public health. And by providing competition to insurance companies with sky-high profit margins and vast executive salaries, it might also restrain cost pressures.

Another sensible proposal would be to subject new drugs and medical devices to cost-benefit analyses. That would tell us whether an expensive new treatment actually delivers better care that’s worth the extra money. Pharmaceutical companies and makers of medical equipment don’t like the sound of it.

Clearly, the road to controlling costs will not be a smooth one. If the May 11 get-together does produce savings with little pain, that would be a grand thing –– though very unlikely. If it’s an amiable opening to hard talks ahead, that’s fine. But there have to be hard talks.

Let them commence.

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