(Today’s Newt Gingrich Letter has been written with Nancy Desmond, CEO of the Center for Health Transformation.)
Last week, the Federal Reserve made a little noticed, but astonishing announcement. In addition to projecting unemployment over 10% in the coming months, they also projected no net new jobs over the next five years.
Let me repeat that to drive the point home: no net new jobs over the next five years.
This is an amazing and sober prediction about the health of our economy, one that should make every lawmaker pause and reassess the priorities of government.
In this environment, almost every decision for lawmakers should come down to one question: Since small businesses create ¾ of the jobs in America, would this piece of legislation create a better or worse environment for small business job creation?
It is in this context that tonight’s press conference with President Obama on health reform should be judged.
The Opportunity Buried in the Bad News
Until now, President Obama has more or less allowed Speaker Nancy Pelosi and her allies in the House to dictate the terms by which health reform would be accomplished.
Disappointingly, they have chosen an expensive, big-bureaucracy health care plan that would raise taxes on small businesses.
The reaction from moderate Democrats, Republicans, health professionals, indeed, from most Americans, has been growing opposition, and despite a massive majority in the House, it looks unlikely today that Speaker Pelosi can coerce this legislation through Congress like she did the energy tax.
As a result, President Obama could be stuck tonight trying to defend an indefensible piece of high tax legislation in the middle of a recession with growing unemployment and massive deficits. It’s a task that will be even more difficult in the wake of CBO Director Douglas Elmendorf’s recent testimony before the Senate Budget Committee that the proposed legislation would actually increase the long term trajectory of federal spending in healthcare.
But what if President Obama used the announcement from the Federal Reserve to, in effect, start the health-reform debate over?
What if he said tonight, that given the continued trouble of our economy, he is asking Congress to go back to the drawing board to craft a pro-jobs, pro-growth, pro-reform health bill that would gain bipartisan support?
What would that bill look like?
A Pro Jobs, Pro Growth Plan for Health Reform
The fact is America desperately needs real change in our health and healthcare system. Americans are paying more and more money for less and less quality care.
At the Center for Health Transformation, we have been working for the past six years to develop solutions for the problems in our health care system, which don’t rely on higher taxes, bigger government, and more bureaucrats.
We believe we can have a system in which every American has access to better health with more choices at lower cost.
We believe we can have a system in which the individual and his or her doctor have the knowledge and incentives to make wise choices; a system in which fraud and waste are rooted out, in which quality and best practices (not volume of services) are rewarded and in which prevention, health and wellness are central.
And most importantly in today’s troubled economy, we believe we can have a system that will also be central to job creation and to America’s economic recovery.
Six Straightforward Steps to Better Healthcare
To create a system that delivers more choices of higher quality health care at lower cost we need to take the following six straightforward steps:
1. Stop Paying the Crooks. First, we must dramatically reduce healthcare fraud within our current healthcare system. Outright fraud — criminal activity — accounts for as much as 10 percent of all healthcare spending. That is more than $200 billion every year. Medicare alone could account for as much as $40 billion a year. (Please visit www.healthtransformation.net for the information about our latest CHT Press book, Stop Paying the Crooks, edited by Jim Frogue.)
2. Move from a Paper-based to an Electronic Health System. As it stands now, it is simply impossible to keep up with fraud in a paper-based system. An electronic system would free tens of billions of dollars to be spent on investing on the kind of modern system that will transform healthcare. In addition, it would dramatically increase our ability to eliminate costly medical errors and to accelerate the adoption of new solutions and breakthroughs.
3. Tax Reform. The savings realized through very deliberately and very systematically eliminating fraud could be used to provide tax incentives and vouchers that would help cover those Americans who currently can’t afford coverage. In addition, we need to expand tax incentives for insurance provided by small employers and the self-employed. Finally, elimination of capital gains taxes for investments in health-solution companies can greatly impact the creation advancement of new solutions that create better health at lower cost.
4. Create a Health-Based Health System. In essence, we must create a system that focuses on improving individual health. The best way to accomplish this is to find out what solutions are actually working today that save lives and save money and then design public policy to encourage their widespread adoption. For example, according to the Dartmouth Health Atlas, if the 6,000 hospitals in the country provided the same standard of care of the Intermountain or Mayo health clinics, Medicare alone would save 30 percent of total spending every year. We need to make best practices the minimum practice. We need the federal government and other healthcare stakeholders to consistently migrate to best practices that ensure quality, safety and better outcomes.
5. Reform Our Health Justice System. Currently, the U.S. civil justice system is the most expensive in the world — about double the average cost in virtually every other industrialized nation. But for all of the money spent, our civil justice system neither effectively compensates persons injured from medical negligence nor encourages the elimination of medical errors. Because physicians fear malpractice suits, defensive medicine (redundant, wasteful treatment designed to avoid lawsuits, not treat the patient) has become pervasive. CHT is developing a number of bold health-justice reforms including a “safe harbor” for physicians who followed clinical best practices in the treatment of a patient. You can learn more at www.healthtransformation.net.
6. Invest in Scientific Research and Breakthroughs. We must accelerate and focus national efforts, re-engineer care delivery, and ultimately prevent diseases such as Alzheimer’s Disease and diabetes which are financially crippling our healthcare system.
The Last Thing We Need is a Plan That Raises Taxes and Eliminates Jobs
Clearly, the last thing America needs is more taxes on job producers, whether it is in the form of a national energy tax, automatic tax increases in 2010 when the 2003 tax relief measures expire, or a healthcare plan that will raise taxes, eliminate jobs, and allows Washington bureaucrats to make decisions that ought to be made by individual Americans together with their families and doctors.
President Obama has a choice tonight, as does America.
We can make health and healthcare into a major source of job creation, economic revival, and improved health and well-being for every American.
Or we can make it into a government-run system that will destroy our economy along with our health.
To learn more about our plan for reforming health without raising taxes, eliminating jobs or raising the deficit, please visit www.healthtransformation.net.
Newt Gingrich and Nancy Desmond
Newt’s Quick Links
• A pro-jobs, pro-growth health reform plan is just one step towards getting our economy moving again. Today, American Solutions will hold a press conference to outline a “Jobs Here, Jobs Now, Jobs First” agenda for small business job creation. You can learn more at www.americansolutions.com.
• To see a recent historical example of how a pro-growth agenda can revitalize the American economy, watch Callista and my new movie, Ronald Reagan: Rendezvous with Destiny.
• When some Americans noticed the glaring contrast between the mainstream media’s treatment of the death of pop singer Michael Jackson and the death of World War II hero Darrell “Shifty” Powers, they got together on the internet to do something about it. Powers was part of the “band of brothers” who landed in Normandy with the 101st Airborne on June 6, 1944 to help reclaim the European continent for freedom. He died June 17. To learn ways you can join in his memorial, go here.