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March 15, 2005
Gingrich Touts Healthcare Transformation

Newt Gingrich, former speaker of the United States House of Representatives, was the keynote speaker for the first day of the 2005 SHRM Employment Law and Legislative Conference in Washington, D.C. on Monday, March 14, 2005. Gingrich advocated for healthcare reform that maximizes the use of technology, provides incentives for people to be healthy, and revolutionizes the healthcare delivery system.

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Gingrich prefaced his remarks by saying that during the next 40 years, China and India will replace the U.S. as the biggest market worldwide. In order to remain competitive in these markets, the U.S. will have to become more flexible and find ways to reduce expenses, including healthcare expenses.

"I believe what we will do is create a 21st century intelligent health system" said Gingrich. By intelligent, Gingrich explained, he means a system that is automated and makes full use of information technology. This will allow individuals to access their own medical records on-line, as well as detailed information about the experience of providers and their track records.

Gingrich emphasized that our current healthcare system does not work for two reasons. First, the healthcare delivery system in the U.S. is a triangular system where one party pays the bills, a second party receives care, and a third party provides the care. According to Gingrich, because the party receiving the care is not financially responsible, he or she does not take responsibility for their healthcare choices. "No one ever washed a rental car" said Gingrich.

Second, according Gingrich, the current healthcare system in the U.S. is focused on acute care, e.g., caring for people after they are already sick. In order to reduce healthcare expenses, this needs to be changed to provide incentives for individuals to stay well and manage their health. One example, according to Gingrich, is a disease such as diabetes. Proper nutrition and lifestyle may help individuals avoid diabetes and, if they develop the disease, managing diabetes may prevent complications such as kidney failure that require expensive treatment. Under our current system, many healthcare plans don't pay for blood sugar testing supplies or provide assistance with managing the disease. However, they will pay for kidney dialysis (acute care for kidney failure), which is very costly.

Gingrich advocated for consumer-directed health care and believes that Health Reimbursement Accounts (HRAs) should replace the traditional indemnity or HMO plans currently in place. Workers should have financial incentives to stay healthy. This, according to Gingrich, will make U.S. workers more responsible for their healthcare and, in for their own health.

In his latest book, Saving Lives and Saving Money, Gingrich spells out his plan for transforming health and healthcare in the 21st century system.

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