June 15 (Bloomberg) -- President Barack Obama told the nation’s doctors they should support his health-care overhaul plan because the current system is turning them into “bean- counters and paper-pushers” rather than healers.

Obama, in a speech to the American Medical Association in Chicago, said physicians and hospitals are being rewarded for ordering procedures instead of for how they care for patients. He said that, while the cost of malpractice lawsuits is “a real issue” for doctors, he won’t support capping damage awards.

The U.S. operates under a model that “rewards the quantity of care rather than the quality of care,” Obama told the AMA’s annual meeting. “It’s a model that has taken the pursuit of medicine from a profession -- a calling -- to a business.”

Obama is stepping up his campaign for a health-care overhaul as he seeks to meet his self-imposed deadline of getting legislation through Congress and to his desk by October. Last week he held a campaign-style town-hall meeting in Green Bay, Wisconsin, and he used his weekly radio address to outline some of the savings and cost cuts that will cover part of the estimated $1 trillion cost of his proposals.

Seeking Support

In addressing the AMA, Obama is making his pitch directly to a constituency whose support he will need to get his proposal passed, particularly provisions dealing with reining in costs. “We’re going to need the help of the AMA,” he said.

Obama said the escalating price for health care in the U.S. is “a ticking time-bomb” for the federal budget and a threat to businesses large and small, as well as to families. Doctors are burdened by paperwork and often don’t have immediate access to the latest research on treatments, he said.

Addressing a top concern of doctors, Obama said, “It will be hard to make some of these changes if doctors feel like they are constantly looking over their shoulder for fear of lawsuits.”

When the crowd of doctors and health-care professionals burst into cheers and applause, Obama told them, “Don’t get too excited yet.”

“I want to be honest with you,” he said, “I’m not advocating caps on malpractice awards.”

Reducing Lawsuits

Obama said he’s willing to “explore a range of ideas” about reducing the risk of lawsuits, without giving specifics. As a senator, Obama supported steps to cut medical errors, improve doctor-patient communication and encourage negotiated settlements for injuries.

Doctors were “thrilled” to hear Obama acknowledge malpractice costs are a problem, AMA President Nancy Nielsen said. While the president said he opposes caps on malpractice awards, he “didn’t take it off the table,” she said at a news conference following the speech.

“He is acknowledging that, indeed, it is a problem that needs to be addressed and there are ways it can be addressed and he’s going to work through those with us,” Nielsen said.

The president warned against the “fear tactics” being used by opponents of his proposal “to paint any effort to achieve reform as an attempt to socialize medicine.”

Obama said that revamping the way care is delivered and paid for won’t upend existing relationships between doctors and patients or force people to change insurance plans.

Existing Relationships

“We will keep this promise to the American people: If you like your doctor, you will be able to keep your doctor, period,” he said.

Most of the cost of the overhaul can be recouped by savings through more efficient medical record-keeping, focusing insurance payment for results rather than procedures and cutting back on reimbursements to hospitals for emergency room visits as more people are insured, Obama said.

Estimates of the cost of a health-care overhaul range from slightly more than $1 trillion to as high as $2 trillion.

“In the weeks and months ahead, I look forward to working with Congress to make up the difference so health-care reform is fully paid for,” Obama said today.

To critics who warn that his proposals would allow the government to dictate treatment, Obama said the goals are to provide more information to doctors and patients to make their own decisions.

“I make the assumption that if you have the information about what makes your patients well, that’s what you’re going to do,” he said. “We don’t need to force you to do it.”

Republican Proposal

Senate Republicans introduced legislation today to bar the government from limiting care to patients under findings from “comparative effectiveness research,” or side-by-side studies of medical treatments or services to see what works best. Obama’s economic stimulus included $1.1 billion for research.

Jon Kyl of Arizona, the second-ranking Senate Republican leader, said sponsors also want to ensure that any health-care overhaul doesn’t deny patients care under federal programs such as Medicare.

Obama also reaffirmed his stance that the overhaul should include creation of a government-run plan that will provide an option for those without insurance. That is running into opposition from Republicans in Congress, and some Democrats say there may not be enough support in the Senate to get it passed.

Nielsen said the AMA shares Obama’s goal of providing affordable insurance for all Americans.

‘Health Exchanges’

Until more details are unveiled, the AMA is withholding judgment on specific proposals such as the “health exchanges” Democrats want to create to let consumers comparison shop or the government-backed health plan that Obama supports, she said. The association doesn’t think a public plan is needed to fix the system, Nielsen said.

Virginia Representative Eric Cantor, the second-ranking Republican in the House, said a government-run insurance plan would squeeze out private insurers.

“Democrats are touting a government-run health care option that creates an unlevel playing field leading to the destruction of the private market, reducing choice and putting Washington bureaucrats in charge of family health-care decisions,” he said in a statement issued as Obama was giving his speech.

Senators drafting health-care overhaul legislation are weighing a compromise that would use nonprofit cooperatives, instead of a government-run program, to provide coverage for the uninsured. The concept would let the cooperatives negotiate directly with health-care providers for low-cost rates. The plans they offer would be sold, like private plans, through new Internet-based exchanges where consumers could buy insurance at lower-cost, group rates.

To contact the reporter on this story: Nicholas Johnston in Chicago at njohnston3@bloomberg.net

Last Updated: June 15, 2009 15:52 EDT