Universal health plan could yield savings

March 20, 2007

Bloomberg News

Study: Spending could be cut by $60.7b per year

WASHINGTON -- Expanding government health insurance coverage to all Americans could reduce healthcare spending by as much as $60.7 billion a year, according to a study by a nonpartisan research center.

The estimated savings would include a $33.9 billion cut in the cost of prescription drugs, the New York-based Commonwealth Fund said in a report yesterday . The organization evaluated proposals introduced in Congress in recent years, including some that would allow everyone to enroll in Medicare, the government health insurance program that now serves older Americans and the disabled.

Congress and President Bush are debating what to do to help America's uninsured, about 47 million people. Polls show Americans are concerned about rising healthcare costs, which make up about 16 percent of total US spending.

"We wanted to highlight that there were feasible bills introduced to Congress over the past two years that would incrementally or more fundamentally expand coverage," Sara Collins, the fund's assistant vice president, said in a telephone interview.

The study examined 10 proposed plans and assumed each was fully in place in 2007. The research was carried out the Lewin Group, a health consulting firm based in Falls Church, Va.

The $60.7 billion in savings was based on legislation proposed last year by Representative Pete Stark, a Democrat from California, that would allow everyone to get insurance through Medicare or government-approved private plans under Medicare. Employers with 100 or more workers could keep paying for private coverage or contribute to a fund to have employees covered through the government.

Bush's healthcare proposal, calling for a tax deduction for health insurance, would cover 9 million people that are now uninsured and save about $11.7 billion a year, the study said.

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