PwC: Cost reduction in healthcare sector should be president's top priority in second term

A new consumer survey of more than 1,200 voters conducted by PwC Health Research Institute (HRI) found that 69 percent want President Barack Obama to make reducing costs his top healthcare priority in his second term.

The survey also revealed ongoing dissatisfaction with either all or part of the Affordable Care Act (ACA), the administration’s landmark health reform law, with 43 percent saying it should be modified, 36 percent favoring a complete repeal of the law and only 21 percent favoring keeping the law intact.

When asked to chose two areas where the federal government should look for savings in the current system, half of all respondents said that it should reduce the amount paid to doctors and hospitals and 42 percent said it should reduce the amount for investing in health information technology.

Reducing payments to doctors and hospitals as a means to reduce costs is a tough nut for the administration to crack, since providers are already displeased with current reimbursement rates for Medicare and Medicaid. Given the more than 30 million people expected to gain insurance coverage under the ACA – and with the majority of them likely to be enrolled in Medicaid – reducing payments to providers may cause a significant number of providers to drop out of Medicare and Medicaid programs.

“This would leave a growing patient population with fewer providers— and it could translate to smaller access networks for managed care providers,” the HRI researchers wrote.

Saving costs via reducing the amount spent on HIT could be similarly troublesome.

“As is often the case, the HRI survey reveals a gap in public attitudes and the agenda in Washington,” the researchers added, while noting the major effort that has been under way by the federal government to invest in HIT, including an additional $28 billion budgeted through 2015.

“Most industry experts believe that interoperable digital records and sophisticated clinical informatics will lead to improved health outcomes and eventually, lower costs,” the report continued. “Early studies suggest that real-time electronic data can help improve patient compliance, reduce medical errors and speed accurate diagnoses. However, voters do not seem to have gotten that message.”

Other areas in which consumers would like the government to find savings are:

  • Reduce spending on public health and prevention (31 percent)
  • Raise the Medicare eligibility age for seniors (29 percent)
  • Reduce Medicaid and other subsidized care for low-income Americans (27 percent)
  • Reduce investments in research and development for new medicines/therapies (21 percent)

The survey did show some demographic differences in priorities. For instance, a much higher percentage of women than men indicated the administration should place an emphasis on prevention and public health programs, while men favored an approach of reducing the government’s involvement in healthcare by a margin of 41 percent to 35 percent.

As Congress and the president look for ways to avert the fiscal cliff, and with healthcare expenditures clearly in play for budget cuts, the PwC researchers suggest consumer attitudes about healthcare can help the industry target its efforts to these expectations.

“As consumers pay more and more of their own healthcare costs, their influence will continue to grow. The HRI survey results reinforce the notion that the health sector must position itself to cater more to cost-conscious consumers who have their own ideas around how the healthcare system should operate,” the report concluded.

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