NEWT GINGRICH HAS A BETTER WAY - REPLACE OBAMACARE

Breakout in Healthcare: Part I This is the first in a series of newsletters on the concept of Breakout, a different approach to politics and governing that focuses on harnessing new breakthroughs to create a better American future. That approach is the subject of my new book, Breakout, which will be released November 4. Here is a radical proposal for the budget conference committee tasked with working out a spending agreement: don’t impose pain on the American people just because Washington refuses to do the hard work of managing itself responsibly. The current framework for a so-called “deal” is lose-lose. Republicans will agree to let Democrats raise taxes if Democrats will agree to let Republicans cut entitlements. Both sides are talking about how Washington can impose pain on the American people and nobody is talking about fundamentally rethinking Washington. We could save trillions of dollars if we ended the city’s absurd tolerance of waste and fraud. We could save hundreds of billions by harnessing new science and technology to make government dramatically more efficient and less expensive. Yet neither side seems interested in exploring these alternatives to imposing pain on the people. What if new technology could save $160 billion in Medicare and Medicaid costs over ten years? Would that be enough to get the committee’s attention? Would Democrats consider those savings as good as a tax hike? Would Republicans consider them as good as an entitlement cut? That level of savings is exactly what Elizabeth Holmes, a young woman who dropped out of Stanford ten years ago and used the rest of her college fund to start a company called Theranos, believes she can deliver. For a decade, Ms. Holmes divulged almost nothing publicly about what the company was working on, even as she drew more investment and hired hundreds of employees. Then, last month, the company announced in an interview with the Wall Street Journal that it would soon introduce a system to “automate and miniaturize more than 1,000 laboratory tests, from routine blood work to advanced genetic analyses.” Theranos has developed technology that can perform all of these tests much more accurately than current laboratories, and with just a few drops of blood. The company will return the results electronically within just a few hours. Even more importantly than the greater precision and speed, Theranos has promised to deliver each of its tests for less than half the Medicare rate. The company’s “conservative” estimate is that the savings would add up to $157 billion in Medicare and Medicaid over ten years, simply by adopting the newest technology for medical lab tests. That is a huge reduction in spending without hurting anybody except Theranos’s slower, more expensive, and less precise competitors. Theranos has taken another revolutionary step that won’t make those competitors any happier: it’s publishing price and quality information publicly on its website. This is practically a declaration of war on the rest of the industry, which, as Joseph Rago notes in the Journal interview, regards price and quality information more or less as a trade secret. It’s no wonder prices are high and quality is low under absurd agreements to obscure prices. That is the collusion Theranos is attempting to break, and why the company may ultimately end up saving taxpayers hundreds of millions of dollars. If only the budget committee could be persuaded to consider it. More breakthroughs to come in future newsletters. Your Friend, Newt P.S. Callista's new children's book, Yankee Doodle Dandy, is now available! Join Ellis the Elephant as he discovers the American Revolution and how America became a free and independent nation in the third installment of this New York Times bestselling series. Order now>>