Health Care Will Cost Less in the Long Run, Says Medicare Chief Berwick

Penny Starr | April 13, 2011 | 3:11pm EDT
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Donald Berwick, administrator of Centers for Medicare and Medicaid, spoke at an event to announce $1 billion funding for an Obamacare initiative that health care could be improved and made cheaper like televisions and telephones. ( Starr)

( – Donald Berwick, administrator for the Centers of Medicare and Medicaid Services (CMS), on Tuesday compared the new health care law, which requires more government control, to other products that have become better and cheaper over time in the marketplace without government involvement.

Berwick said health care is “just like any other important segment of our economy” and “doing it right” will cost less in the long run.

He spoke Tuesday at a press conference where the administration announced $1 billion in federal funding to improve medical care in the nation’s hospitals.

“Computers today do more than they ever have at far lower prices,” Berwick said. “The same is true for cars, and TVs and telephones – just about every other product or service that we really care about.

“And they didn’t get there by cutting or by rationing,” Berwick said. “They got there by improving the processes that make their products and services.”

However, automobiles, telephones, computers, and televisions are products that stemmed from and thrived in a relatively free marketplace, unlike Medicare and Medicaid, which are run by government, and unlike Obamacare, which represents more government intervention in the health care marketplace and mandates that people buy its product, i.e., health insurance.

Berwick joined Health and Human Services Secretary Kathleen Sebelius and guest speakers and others who are supportive of President Barack Obama’s health care law, including the head of the AFL-CIO and the president of the American Medical Association.

In her remarks at the event, Sebelius said the “Partnership for Patients” initiative “will bring together hospitals, physicians, nurses, employers, unions, patient advocates, health plans, and others to improve the safety of health care in America.”

Health and Human Services Secretary Kathleen Sebelius said at the event that Berwick was the 'right person at the right time' to administer the initiative. ( Starr)

Sebelius said the goals are to “reduce preventable injuries” in hospitals by 40 percent by 2013, a reduction she said could save 60,000 lives. The initiative is also supposed to prevent hospital readmissions by 20 percent by 2013.

“That’s why we are announcing today that we will commit up to $1 billion in new funding from the Affordable Care Act towards our two initial goals,” Sebelius said. “In addition, we are providing hospitals and physicians with an unprecedented range of resources about what other health care providers are doing to improve patient safety.”

Berwick’s remarks on Tuesday are in contrast to controversial comments he has made over the years about rationing health care services and his admiration for the single-payer, government-run health care system in Great Britain, as reported earlier by

“The decision is not whether or not we will ration care – the decision is whether we will ration with our eyes open,” Berwick said in a June 2009 interview with Biotechnology Healthcare.

In a talk Berwick delivered in England in 2008 to mark the 60th anniversary of Great Britain’s National Health Service, the bureaucracy that runs that country’s health care system, Berwick told the British that he loved their system. “Cynics beware,” he said. “I am romantic about the National Health Service; I love it.”

He particularly drew attention to the British system for limiting the budget for and planning the supply of health care services through government planning.

“You cap your health care budget, and you make the political and economic choices you need to make to keep affordability within reach,” Berwick said. “You plan the supply; you aim a bit low; you prefer slightly too little of a technology or a service to too much; then you search for care bottlenecks and try to relieve them.”

In the June 26, 2008 issue of the British Journal of Medicine, Berwick published an article praising Britain’s government-run system and criticizing marketplace health care in the United States because it fuels competition that apparently produces an excess supply of health care.

In contrast to his current views on how competition improved and lowered the cost of computers, televisions, and telephones, Berwick wrote in 2008: “Please don’t put your faith in market forces,” he said. 

“It’s a popular idea: that Adam Smith’s invisible hand would do a better job of designing care than leaders with plans can. I find little evidence that market forces relying on consumers choosing among an array of products, with competitors fighting it out, leads to the healthcare system you want and need. In the US, competition is a major reason for our duplicative, supply driven, fragmented care system,” Berwick added.

At Tuesday’s event, Sebelius repeated her view that Berwick is “the right person at the right time” to run the nation’s largest medical entitlement program and the latest $1 billion program funded by Obamacare.

“As we move forward, we couldn’t have a better person guiding this effort than Dr. Don Berwick,” Sebelius said. “President Obama chose Don as the administrator of the Centers for Medicare and Medicaid Services and I’ve gotta’ tell you, he is the right person at the right time to lead this critical initiative.”

President Barack Obama recess-appointed Berwick to head the CMS in July 2010 when Congress was in recess. That appointment will expire at the end of this year, 2011, unless the Senate votes to confirm Berwick. In late January, Obama renominated Berwick for Senate confirmation.

As reported in March, 42 Senate Republicans wrote a letter to President Obama opposing Berwick at CMS because of his support for health care rationing and Britain’s single-payer, socialized health care system.

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