Karen Davenport on health care and the federal budget

What does is mean to modernize the health system?

There are a few steps involved in modernizing the health system. I think the most important things are making the investments we need to have a more productive health care system in the future. And that's certainly around things like prevention; it's about health information technology; it's about understanding which treatments, or drugs, or devices work best for a given health care condition. It's also about understanding what we do and what kind of results we're getting from it. So, the kind of data collection and analysis is important to modernizing the health care system. And finally, to make sure that there are the right incentives in place so that patients manage their health care, as well, so that they monitor their blood sugar levels, or so that they watch their diet, or they get enough exercise. Just generally so that they take an active role in managing their health.

Can the federal budget handle these additional investments?

It's certainly a short-term challenge, particularly to the Congress, to where do we get the money to modernize the health care system, to make the investments in coverage, and in prevention, and in infrastructure so that we see long-term savings. But the other important question is: can we afford not to reform the health care system? We have probably more than 50 million Americans at this point without health insurance; we have health care costs skyrocketing out of control; and we know that, in the long run, health care costs are a leading driver of our federal budget deficit. So, since we know that modernizing the health care system will lead to savings over time, this is an investment that we really need to make now so that we will see those savings later.

How quickly would we begin to see savings?

David Cutler, a Harvard University economist, recently did a study for the Center for American Progress Action Fund, which showed that we would see 600 billion dollars in federal budget savings over 10 years and 9 trillion dollars over 25 years. Those are federal budget savings; that doesn't reflect the broader savings in the health care system. But what's particularly important to think about is that these are savings that are going to accrue to the federal budget, that will help us address our nation's long-term financial stability, and help us reduce the deficit, so that overall we will see a benefit—not only in how our health care system changes and delivers better health care to the American people, but it will also help us get our financial house in order.