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Critic Disappointed At Health Care Proposal

ROBERT SIEGEL, host:

Now Rich Umbdenstock, who is president and CEO of the American Hospital Association. Welcome to the program.

Mr. RICH UMBDENSTOCK (President and CEO, American Hospital Association): Good afternoon, Robert.

SIEGEL: You were one of the stakeholders who met with President Obama at the White House last month and pledged, I thought, to take steps to save the nation more than two trillion dollars in health care spending over the next 10 years. Since then, the Obama administration has called for cuts of a couple of hundred billion dollars in hospital reimbursements. You've expressed disappointment and concern. Can hospitals reduce spending or not?

Mr. UMBDENSTOCK: Well as part of that effort at the White House, we pledged to do our part. That was a very aggressive national goal and the specific issue was what could we do that didn't require a legislation. And I think it was a good exercise in that sense and some significant commitments, including ours, came out of it. Now the issue of cuts is a very different issue, in that you have to look at cuts in the context of a complete plan for reform. And our elements in reform include the important element of affordability.

SIEGEL: Mm-hmm.

Mr. UMBDENSTOCK: But also, we have to think about coverage. We have to think about quality. We have to think about connecting the system and health ideas. One example of how that might be enabled…

SIEGEL: You mean electronic…

Mr. UMBDENSTOCK: Electronic - sorry…

SIEGEL: Electronic medical records keeping.

Mr. UMBDENSTOCK: Correct, yes.

SIEGEL: But we could think about those things - and it might take decades to change a national culture regarding wellness, and when we see the doctor and for what purpose. In the meantime, we're spending $2.3 trillion a year on health care reform. Can the hospitals cut spending soon?

Mr. UMBDENSTOCK: I think all stakeholders have to examine what they can do now. So, very definitely, hospitals already are working hard at improving quality and the related costs. That's been going on now for several years and we want to see that not only continue but pick up in pace.

SIEGEL: Let me ask you about what Peter Orszag, the OMB Director, said which is that, it would be a double payment to your member hospitals to both reduce the number of the uninsured and also maintain the current level of reimbursement. That is, if fewer uninsured patients are turning up at your member hospitals because there's been a new system of health insurance offered them, why shouldn't Washington reduce reimbursements?

Mr. UMBDENSTOCK: Well, let me be a little specific here. What Peter is referring to is what we call disproportionate share payments.

SIEGEL: Mm-hmm.

Mr. UMBDENSTOCK: It's for hospitals that see a disproportionately high share of uninsured or Medicaid beneficiaries. Now, certainly, if people were to have coverage tomorrow, everybody today who's not covered, you could make the case for those dollars going away. But how soon will that coverage kick in? At what payment levels, across what proportion of the uninsured population? Even by the best estimates, right now, people are saying that it looks like some of the plans that are out there could cover maybe a third, maybe at the high end, two-thirds of the population. That still leaves a lot of people uncovered. It still leaves a lot of people on the Medicaid program, and it still leaves a lot people who are undocumented immigrants, and so on. So that need isn't going to go away over night.

SIEGEL: But let's say, of the roughly whatever it is, 45-48 million uninsured people that - let's assume success, that two-thirds of them do, indeed, become insured over a period of years. Would the hospitals, would your member hospitals accept, in principle, the idea that reimbursements from Washington should conversely decline as the number of insured patients rises at those very institutions?

Mr. UMBDENSTOCK: Yes. We have accepted that, in principle. We understand that that would be a definite improvement over the current system of so many Americans not having health insurance. But the question is: By when? At what level of coverage, across what proportion of the population?

SIEGEL: You spoke of the commitments that you did make at the White House when you talked about controlling increases in health care spending. What are those commitments? What are the hospitals going to do?

Mr. UMBDENSTOCK: Well, what we want to do is build upon the great momentum that's already out there among hospitals in terms of reducing complications and improving safety for patients, so that we're not incurring additional costs, so that we can work on really new techniques that have come out for how to avoid and prevent very costly, very dangerous infections, how we can use new tools for avoiding surgical mishaps. Now, these are spreading across the country. Unfortunately, the data lags a couple years. But we know that our hospitals are actively involved in that. If we can get more of them moving even faster than they are today, we believe we can save money.

SIEGEL: So you're saying these are improvements in the quality of hospital care…

Mr. UMBDENSTOCK: Right.

SIEGEL: …that are already underway. But they haven't already been reflected in a slower rate of increase in hospital costs, have they?

Mr. UMBDENSTOCK: Well, I'll give you an example. Michigan had a collaborative across all of their hospitals on how to eliminate what's called central line infections - infections associated with central lines that are place in patients, very dangerous situations. Now, these hospitals, working together, were able to actually get their numbers down to zero and to hold them there over a long period of time. That's never been done before. To replicate that in all of the hospitals where that technique is used is very important work. Now the question is how do we spread it and make it part of the routine at every hospital?

SIEGEL: But since we generally, I mean, assume that our hospitals are doing these things - I mean, it doesn't require the president calling people in to get the hospitals to want to reduce complications and infections, they're doing these things. If that were the case, we would've seen a steady cost of hospital care, or a decline, or at least nothing more than the normal rate of inflation.

Mr. UMBDENSTOCK: Well, it's not the only issue that's driving the cost of health care. So I think we have to look more broadly than that. But can we eliminate that source of additional spending? That's the goal.

SIEGEL: Rich Umbdenstock, president and CEO of the American Hospital Association. Thank you very much.

Mr. UMBDENSTOCK: Thank you. Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.