Claims of savings from health information technology, prevention, pay for performance, and comparative effectiveness research are politically attractive. Their political appeal lies largely in the embrace of widely supported goals, including better health and improved quality of medical care. In theory, these reforms—more research, more preventive screenings, and better organized patient data—sound like benign devices to moderate medical spending. For many purposes, such reforms are substantively very desirable. But these reforms are ineffective as cost-control measures.

Similarly, studies in the 1990s by the Congressional Budget Office and General Accounting Office found that single payer was the most cost effective way to get to universal comprehensive coverage. So have repeated analyses by the Lewin Group of both State-based single payer proposals over the past 15 years, and in their recent comparison of congressional proposals for the U.S.

As Dr. Himmelstein is testifying today:

With President Obama and congressional leaders vowing to pass a health reform bill by the end of the year, a prominent Harvard-based health policy analyst warned a House subcommittee Thursday that the leading incremental models for reform, including those patterned after the Massachusetts plan, are incapable of containing skyrocketing health care costs or providing quality, affordable care to all.

"A single-payer reform would make care affordable through vast savings on bureaucracy and profits," Himmelstein said in his statement. "As my colleagues and I have shown in research published in the New England Journal of Medicine, administration consumes 31 percent of health spending in the U.S., nearly double what Canada spends. In other words, if we cut our bureaucratic costs to Canadian levels, we'd save nearly $400 billion annually - more than enough to cover the uninsured and to eliminate co-payments and deductibles for all Americans."

A national health insurance program would slash the enormous paperwork burden on hospitals, doctors and patients, Himmelstein said, resulting in hundreds of billions in savings that could be redirected to patient care.

Half-measures like those proposed by the Obama administration and key lawmakers like Senators Max Baucus (D-Mont.) and Edward Kennedy (D-Mass.), many of which mirror aspects of the Massachusetts reform of 2006, can't match the savings of a streamlined, publicly financed system, he said.

Even if a "public plan option" emerges as part of the House and Senate reform bills, Himmelstein said, it won't be sufficient to challenge the inefficiencies and wastefulness of a multi-payer system: "A health reform plan that includes a public plan option might realize some savings on insurance overhead. However, as long as multiple private plans coexist with the public plan, hospitals and doctors would have to maintain their costly billing and internal cost tracking apparatus. Indeed, my colleagues and I estimate that even if half of all privately insured Americans switched to a public plan with overhead at Medicare's level, the administrative savings would amount to only 9 percent of the savings under single payer."

Citing his direct experience with the Massachusetts plan, which is facing critical financial problems, Himmelstein commented: "Prevention, disease management, computers and a health insurance exchange were supposed to make reform affordable. Instead, costs have skyrocketed, rising 23 percent between 2005 and 2007, and the insurance exchange adds 4 percent for its own administrative costs on top of the already high overhead charged by private insurers. As a result, 1 in 5 Massachusetts residents went without care last year because they couldn't afford it. Hundreds of thousands remain uninsured, and the state has drained money from safety-net hospitals and clinics to keep the reform afloat."

While the conventional wisdom in Washington is that single-payer national health insurance is "not feasible" and therefore "off the table," public opinion polls have shown solid majorities continue to support such an approach. In a survey published by the Annals of Internal Medicine a year ago, 59 percent of U.S. physicians said they favored government action to establish a national health insurance program, a 10-percentage-point leap from only five years prior.