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Last modified: Wednesday, August 12, 2009

SPEA policy brief addresses challenges in health reform

Aug. 12, 2009

BLOOMINGTON, -- Congress may approve health reform legislation this year, but it remains to be seen whether the changes will stem the rising tide of health-care costs that is threatening the U.S. economy, an Indiana University expert writes in a new policy brief.

Eric Wright, director of the IU Center on Health Policy and professor and associate dean of the School of Public and Environmental Affairs at Indiana University-Purdue University Indianapolis, writes about health reform in the August 2009 issue of SPEA Insights.

He says that President Barack Obama's health-reform proposal takes important steps, but it may not change behaviors that lead to high health-care costs.

"Clearly, change is necessary," he writes. "But we also need to address the many social and cultural issues -- many of which are direct outgrowths of our current fragmented system -- behind the problematic ways that both patients and providers use our health care system."

Wright, an active researcher in the areas of health policy and health services, points out that U.S. health-care costs are increasing rapidly. Health care expenditures consumed 16.1 percent of the nation's gross domestic product in 2007 and, at the current rate of growth, are expected to top 20 percent by 2018, according to the Center for Medicare and Medicaid Services.

Obama's proposal, he writes, focuses on:

  • Expanding the use of health information technology and electronic medical records
  • Expanding research on the effectiveness of treatments and providers
  • Investing more in prevention
  • Reforming the payment system to reward excellence
  • Preventing insurers from denying coverage because of pre-existing medical conditions

The president also has proposed a national health insurance exchange to assist individuals and small businesses in purchasing health-care coverage, and he has called for including a "public option" -- that is, a government-run health insurance product available through the exchange.

But it isn't clear that the proposed reforms will deter excessive use of health-care and specialty health services, one of the main drivers of cost increases, Wright says. Both patients and providers are involved in making decisions about health care, he points out. And "cultural beliefs and values," not just their knowledge of costs and effectiveness, influence their choices.

"Of particular importance are cultural beliefs that 'more is better' and 'higher tech care is better care,' which can encourage inappropriate and over-use," he writes.

Wright says there has been a cultural shift in medicine from healing to "doctoring," with productivity concerns causing providers to spend less and less time with patients. To reverse that trend, he said, "will require fundamentally changing the culture of medical practice to value 'healing' over 'treatment,' something not easy to do within a traditional policy perspective on health services."

The complete policy brief can be seen online at