US Health and Human Services Secretary Michael Leavitt has persuaded Midwest employers, including Motorola and McDonald’s, to commit to the Bush government’s new initiative on quality, value and public reporting in their contracts with health insurers.

The idea is that the employers will put pressure on their insurers who in turn will put pressure on the service providers, the doctors and the hospitals.

In August 2006 President Bush issued an Executive Order to implement his “Value-Driven Health Care Initiative” in the government sector by directing federal agencies that manage or support federal health insurance plans to:

(1) Increase pricing transparency by telling recipients of health care how much is paid to health care providers in order for them to receive services and undergo procedures.
(2) Increase quality transparency by telling recipients the extent to which doctors, hospitals and other service providers that they use meet with quality standards.
(3) Put pressure on their health care providers to conform to IT standards and to update their own IT so they can easily share information with them.
(4) Encourage methods and approaches that promote high quality and efficient care in their providers.

The four point plan is now being taken around the country by Secretary Leavitt in a campaign to persuade the big private sector employers to sign up to it as well.

Earlier this year, on January 29th, he signed up the “Detroit 3”, the big three automakers Chrysler, General Motors and Ford, to commit to the new standards.

Leavitt has told employers that if they want to do business with the federal government they must commit to the new standards.

The Bush government has been very critical of the health care system in recent years, calling it expensive and wasteful. They point out that costs have risen year on year at a rate that far exceeds the pace of inflation.

And they point to studies that show the system is riddled with errors and misunderstandings, sometimes resulting in operations that are either not necessary or performed on the wrong part of the body.

At a speech during one of his recruiting drives this week, Leavitt said that the only thing that will change the health care system, which in 1951 cost less than 5 per cent of Gross National Product (GNP) and now costs more than 15 per cent of GNP, is to create a marketplace for it.

There is “insufficient quality and price information,” he said. “We are not very good at measuring quality … we are going to get better at it,” he added.

On Tuesday this week the Washington Post did a piece on the 2008 presidential race and concluded that no candidate will be taken seriously if he or she does not address one of the areas of greatest concern to many Americans “the availability and affordability of health care”.

While the HHS website carries many statements of support from unions, employers and state governors, the new plan is not without its critics.

As with all new initiatives that put pressure on services to perform, the cost of change will be felt by the providers themselves, the hospitals and doctors, where it is estimated that the cost of IT change alone will exceed 30,000 US dollars per doctor.

In a recent interview published in Health Affairs, the US healthcare purchasing “guru” Arnold Milstein discusses the problems that surround the government’s hope that IT change will be the launchpad for quality reform and cost gains in the US health system.

He says that much of the success of such a change will hinge on persuading the providers to pass control of clinical information over to patients and consumers, and moving health policy from “a no man’s land between government and market control”.

Click here for Health Affairs journal.

Written by: Catharine Paddock
Writer: Medical News Today