April 7, 2005
Radical changes that involve technology and market forces are needed to improve the quality and affordability of health care in the United States, former House Speaker Newt Gingrich said Wednesday in Phoenix.
Tinkering with the current system won’t work because it disconnects costs from services, and is run by entrenched bureaucracies and special interests resistant to change, Gingrich said during a symposium on America’s health system put on by the W.P. Carey School of Business at Arizona State University.
"Reform is impossible," the Georgia Republican said during a luncheon speech at the Arizona Biltmore. "I don’t think the current system will ever work."
Gingrich advocated tax-free medical savings accounts and medical reimbursement accounts so patients will become more responsible for controlling costs. Those accounts would be combined with government health care vouchers for the poor and tax credits for those who have jobs but cannot afford insurance as a means of ensuring all Americans can get medical coverage, he said.
The current system has insurance companies or the government paying health care bills, which means there is no incentive for patients or doctors to control the cost of treatment, Gingrich said.
Once patients have more of a financial stake in their medical treatment, they will take a more active role in staying healthy and seeking medical care when problems begin rather than waiting until serious conditions develop, he said.
"Customers are infinitely better served by the markets," Gingrich said. "The genius of the American system is that the customers in the end have greater power than any oligarchy or any monopoly or any guild."
The Carey school is holding the forum to develop recommendations for Congress aimed at improving the quality, accessibility and affordability of medicine. Among the participants are national experts in the fields of medicine, biotechnology, economics, research and government. Former North Carolina Sen. John Edwards, the Democratic vice presidential nominee last year, spoke to the symposium Tuesday.
Under the current system in which patients pay the same rate for a variety of prescription drugs that treat the same ailment, there is no reason to opt for the least expensive, Gingrich said, noting that patients pay the same, regardless of whether the most costly medication is chosen. Drug companies also have an incentive to develop new, more expensive drugs for conditions that already have effective treatments, Gingrich said, citing allergy medications as an example.
The medical field also has been resistant to using technology to improve care and cut costs, Gingrich said. Some hospitals now use computer bar codes to track patients, their conditions and the drugs they are given, he said. Those hospitals have significantly reduced the number of patients receiving the wrong medications, helped identify more effective treatments and provided early warning signs of harmful side effects of medicines, he said.