Health Care For America Now

President Obama just finished announcing the letter he's been presented by the insurance industry and provider groups. As Ezra Klein states, this is the weight in:

As one senior administration official said to me, "this is a commitment, not a plan." The industry coalition has gestured towards various areas of potential savings — among them billing reform, health information technology, and linking payment to outcomes. But they've not presented a detailed proposal for attaining them. They have not set down enforcement mechanisms. Put simply, they are, at this juncture, helping the White House with its messaging. But that doesn't mean they will help the White House with its legislation.

Which gets to my skepticism: This is one of those moments when new words are being used to drown out ongoing actions. A major source of potential savings, at least in the administration's estimation, will come from comparative effectiveness review. But the pharmaceutical industry and the device industry — both of which are represented here — fought violently against CER when the Obama administration sought to include it in the stimulus. By the end, they had managed to win legislative language stating that comparative effectiveness studies wouldn't include cost-effectiveness and wouldn't be used to make coverage decisions. Another source of potential savings is the public plan, which can marry best practices with federal bargaining power to push down costs. The insurance industry has gone to war against this provision.

…

The big test is not today. It's a month from now. In June, the Finance Committee will release the first version of its health reform bill. If the bill is what we expect — something along the lines of Baucus's white paper, or Hillary Clinton's campaign proposal — and these industry groups not only endorse it but explain how they will save money within its confines, that will be something to celebrate. If they use the credibility they've attained today to unleash a more vicious assault tomorrow — if they grimly say that they proved their willingness to work with the administration but this legislation and its public plan and its insistence on evidence and its payment reforms sadly proves the administration's unwillingness to work with them — then that will be a rather less cheery outcome.

That's exactly right. The letter that Obama received contained no specifics on how to get these cost reductions, but Obama has already put forward his ideas in the campaign and in the budget. So, when Obama and Congress asks the insurance industry to put its money where its mouth is and support legislation that makes these cost controls a reality - payment reform, industry regulation, competition in the form of a public health insurance option - will they still be on board?

That's the true test of the industry's commitment to cost control.