A positive approach to cutting costs and saving lives

America’s healthcare system is broken. Healthcare is unaffordable for too many families and rising healthcare insurance premiums are crippling our businesses — which are struggling to remain competitive in the global marketplace.

For every vehicle General Motors produces, the company pays more than $1,500 in healthcare costs for employees while its overseas competitors pay up to two-thirds less. The United States spends twice what other countries spend on healthcare, yet we still have more than 45 million Americans without health insurance. This makes no sense!

Also, when we cut Medicaid and Medicare payments to providers, we simply shift the costs of the uninsured to businesses that provide health insurance. And to add insult to injury, this approach actually increases overall healthcare costs!

With all of America’s resources, surely working together we can do better for America’s families and businesses. Several issues must be addressed to improve the situation, but there’s something we can do now that will have a major impact: invest in health information technology.

Our investment will pay off quickly by lowering costs, improving the quality of patient care and preventing medical errors. But for this to happen, Congress must provide meaningful resources so that healthcare providers can obtain health IT.

Healthcare providers already are struggling to keep up with rising costs, which makes it difficult to invest in new IT. Many healthcare providers rely on handwritten notes for communication and record keeping and some still use typewriters to prepare their patients’ bills.

The results of using 19th century technology in a 21st century healthcare system are higher costs, increased errors and decreased quality of care. In the United States, 31 cents of every healthcare dollar pays for administrative costs — that’s nearly double the rate in other countries. And, we know that 97 percent of medical errors are a product of the system, not the healthcare provider.

That’s why providing access to cutting-edge technology is so critical. Electronic health records will help providers pick up errors, such as potentially life-threatening drug interactions and incorrect drugs and dosages. The administration estimates that e-health records will save as much as 30 percent on overall healthcare spending, reducing costs by hundreds of billions of dollars annually.

Health IT also holds great promise for improving the quality of our healthcare system by ensuring that patients get the care they need, at the right time and in the best setting.

To tap this resource fully, Congress must enact legislation now that provides meaningful resources for health IT.

The bipartisan Health Information Technology Act of 2005, which I introduced in the Senate this year with Sen. Olympia Snowe (R-Maine), would provide federal seed money through a five-year, $4 billion competitive grant program. It also would accelerate depreciation of health IT equipment expenses and adjust Medicare payments to providers who use health IT to improve the quality and accuracy of clinical decisionmaking for patients with chronic conditions.

The result will be substantially lower costs and improved quality — without asking people to get less out of healthcare or to pay more for it. It’s the smart way to reduce healthcare costs.

Before Congress adjourned, we passed the bipartisan Wired for Health Care Quality bill, which I co-sponsored. That bill authorizes a grant program for health IT, which is a good start. But we need to take the next step and provide funding.

For any federal investment to make a difference, it must be substantial. We must ensure the funds are available by using mandatory dollars, such as the federal healthcare trust funds. That way, we can make the most of federal healthcare dollars by serving patients in federal health programs more efficiently. We should not overlook individual providers, who can begin benefiting from the quality, safety and financial savings possible with health IT. And of course, we must implement strong, enforceable privacy safeguards to ensure that patients’ rights are protected.

Federal investments in health IT will result in lower Medicare, Medicaid and SCHIP spending, reduced medical errors, and greater quality and efficiency in our healthcare system. Every day that we delay investments in health IT, businesses, taxpayers and patients pay in both dollars and lives.

America is the greatest country in the world. It’s time to use the technology we have to make healthcare accessible and affordable for all Americans.

Stabenow sits on the Budget Committee and sponsored the Health Information Technology Act of 2005.