Alan Murray: Health-Care Overhaul: GM CEO Weighs In

[question everything]

The Wall Street Journal

February 9, 2005

BUSINESS
By ALAN MURRAY

Health-Care Overhaul: GM CEO Weighs In
February 9, 2005; Page A2

(When) General Motors Chief Executive Rick Wagoner.. appears at the Chicago Economic Club tomorrow.. he'll focus on fixing the U.S. health-care system.

(snip)

He runs not only the world's largest auto maker (a position threatened by Toyota Motor), but also the nation's largest private health-care purchaser (a position threatened by no one.) He's responsible for the health of some 1.1 million people, most of them retirees and their families, and paid $5.2 billion last year for the privilege. The cost of health care now adds more than $1,500 to every vehicle sold, and is rising at double-digit rates.

(snip)

The U.S. spends a fortune on health care -- 15% of its total output, compared with 10% in Germany and 8% in Japan. But it gets a lousy return on that money. Forty-five million Americans lack health insurance. And errors are frequent: Recent studies show adults who visit a doctor or a hospital get what experts recommend as the best treatment only about half the time.

Curing the problem won't be easy -- which may be why the White House has put it on a back burner. Most analysts agree that fixing health care ultimately is more important to the nation's future than overhauling Social Security, rewriting the tax code or cutting discretionary spending. But Mr. Bush wrestled with health care in his first term, and has decided to give these other issues top billing in his second. That means there's little chance he'll have the time or energy to give serious attention to health care again before leaving office.

If costs continue to rise at their current pace, however, you can expect Mr. Wagoner and his business buddies to join forces with beleaguered state governors and insist that health care become the issue of the 2008 presidential campaign.

(snip)

However, most experts believe a consumer-driven health-care system such as the one envisioned by Mr. Wagoner would work only if consumers have more skin in the game. They need to have an incentive to shop for cost-effective care. General Motors helped create a system in which large employers shielded workers from those costs. Now it has to lead the way toward remaking that system.

(snip)

Write to Alan Murray at [e-mail]

URL for this article:
http://online.wsj.com/article/0,,SB110790726260549399,00.html

[Blue_Tires]

1. GM will be looking for a gummit buyout in the future

and i know they're trying to find some legal or economic loophole where they can just dump the hefty UAW contracts...one of the reasons the import carmakers' profit margins are so high are because of the fact that they don't use unions...