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Health groups cut costs for Obama

A coalition of healthcare groups have pledged to cut $2 trillion in projected spending over 10 years to help complement President Barack Obama's healthcare reform initiative

A coalition of healthcare groups have pledged to cut $2 trillion in projected spending over 10 years to help complement President Barack Obama's healthcare reform initiative.

The six private sector associations include drugmakers, hospitals and insurance companies. Their pledge aims to reduce the growth of healthcare spending by 1.5 per cent a year by focusing on efficiency, developing better technology, improving coordination and accepting regulatory reform.

"When it comes to healthcare spending, we are on an unsustainable course," Obama said. "What is a growing crisis for the American people is also becoming an untenable burden for American business… The explosion in healthcare costs has put our federal budget on a disastrous path."

The coalition praised Obama for his "strong commitment to reforming our nation's healthcare system". It also stated that without any reform, the annual rate of increase in national healthcare expenditure is expected to average 6.3 per cent over the next decade.

At this rate, gross spending on healthcare would increase from 17.6 per cent in 2009 to 20.3 per cent in 2018 – higher than any other country in the world. The cuts in spending are thought to save $2,500 for a family of four by the fifth year.

The move by the coalition, some of which have been opposed to reform in the past, has been described as unprecedented but, as yet, the associations have not provided any specifics as to their individual commitments.

12th May 2009

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