Business Group Seeks Overhaul Of Nation’s Health Care System

WASHINGTON — The U.S. health care system is facing a future of rising costs, more limited access, and inadequate quality. And the willingness of large private employers to confront these challenges will determine whether the country can reverse these trends.
This is the conclusion of a new report titled, A New Vision for Health Care: A Leadership Role for Business, released by the Committee for Economic Development (CED).

The policy debate over health care is centered on managed care, but, according to the report, the health care system is in trouble because the incentives it gives to both providers and users are flawed. “The problem is not a lack of good intentions, but a series of structural flaws,” said Charles Kolb, president of CED.

The CED report argues that a retreat by employers from active efforts to improve health care will harm their businesses, their employees, and the nation. “Employers should do more, not less, by becoming smarter and more demanding purchasers of care,” said Dr. Jerome Grossman, who is also director of the Health Care Delivery Program at the Kennedy School of Government at Harvard University.

“There is no easy overnight solution, but we, as business leaders, must step up to the challenge,” he added.

“We believe employers should work with government and labor to transform health insurance into a market-oriented, user-friendly service industry with accountability to purchasers and patients for cost and quality,” said Steffan Palko, a CED trustee and one of the authors of the report.

CED recommends fundamental changes in the way business and government purchases health care. Specifically, it suggests, large and public and employers can:

• Offer a wide variety of responsible health plan choices to employees in exchange for their greater financial responsibility;
• Help to establish, operate, and manage regional purchasing cooperatives that offer affordable plans to small firms;
• Structure their contributions to health insurance coverage in a way that encourages cost discipline, but remain active in screening and negotiating with health plans, managing health benefits, and promoting quality care;
• Share provider networks and their discounted rates with small employees.

A New Vision for Health Care is available from the Committee for Economic Development, 261 Madison Ave., New York, NY 10016. The full text of the report is available online at