WASHINGTON, May 24 (UPI) -- Presidential hopeful Sen. Hillary Clinton, D-N.Y., presented a seven-part plan Thursday aimed at lowering healthcare costs -- a roadmap that several doctors deemed encouraging.

The proposal focuses solely on cutting costs, which Clinton identified as one of three areas critical to healthcare reform.

Addressing students and faculty at the George Washington University Medical Center in Washington, Clinton said she would outline at a later time the other two key components of her reform agenda, improving quality and covering the uninsured.

Clinton acknowledged her first rocky encounter with healthcare reform during her tenure as first lady but said she won't make the same mistakes this time around.

"I have tangled with this issue before, and I've got the scars to show for it, but I learned some valuable lessons from that experience," Clinton told attendees. "One is that we can't achieve reform without the participation and commitment of healthcare providers, employers, employees and other citizens who pay for, depend upon and actually deliver healthcare services."

Public attitudes have shifted as well, with healthcare emerging as one of the paramount issues of the day and one that affects every American -- a fact Clinton is banking on to help build support for her plan.

"I think we finally have a recognition (of healthcare problems)," she said. "Everyone sees there is an economic imperative to rein in cost, there is a moral imperative to extend coverage to all Americans and there is a practical necessity to promote wellness and prevent illness wherever possible."

The senator laid out seven steps to mitigate costs: increase disease prevention, convert from paper to electronic medical records, provide comprehensive care for chronically ill patients, eliminate insurance discrimination, create a "best practices" institute, drive down prices for prescription drugs and reform medical malpractice.

All together, Clinton estimates her plan would lower national healthcare spending by $120 billion, or $2,200 per family.

Physicians at the event expressed enthusiasm for the plan.

"Senator Clinton is right on the money, so to speak, of identifying waste in the system," Richard Becker, CEO of the George Washington University Hospital, told United Press International. "Our resources are not used efficiently."

Unnecessary treatment riddles the system and often causes more harm than good, Clinton said, pointing to a California-based study that found one in every five X-rays and lab tests were performed simply because earlier results were unavailable.

Similarly, The Atlantic Monthly reported a $15,000 surgery that is routinely performed to prevent strokes showed no evidence of lessening risk for two-thirds of the patients who received it.

Clinton's plan to translate the old paper records kept by many practices into electronic documents would help alleviate some of this waste and constitutes one of the most important elements of the proposal, said Jim Scott, dean of the GWU School of Medicine and Health Services.

In order to push hospitals toward implementing electronic recordkeeping, Clinton's plan allocates $3 billion in federal money to help fund the switch. A lack of national organization has been the key factor holding many doctor's offices and hospitals back from using health information technology, Scott said.

"The problem here is compatibility," he told UPI.

Different electronic record systems often cannot communicate with each other, making it ineffective for many medical organizations to use them because they can't be shared between offices or hospitals.

"Wouldn't it just be better if we had some (government) mandate that all these systems 'talk' to each other on the same level?" Scott asked.

But some large organizations, most notably GWU's Medical Faculty Associates, have successfully implemented an electronic system with positive results.

"It has dramatically improved our practice from a patient perspective and from a physician perspective," said Stephen Badger, CEO of MFA, an academic, multi-specialty group practice.

The new system allows MFA to handle payments, test results, prescriptions and many other documents electronically. And it costs less. Healthcare claims made electronically cost 85 cents each, compared with $1.60 for paper claims.

Prevention received perhaps the greatest attention from Clinton, who emphasized the lack of pre-emptive care in today's healthcare system.

"Our country spends only an estimated 1 to 3 percent of national health expenditures on preventive healthcare services and health promotion per year," Clinton said. "That is about the same percentage we spent in the 1920s."

This system leads to higher costs and more health problems, said Matthew Mintz, associate professor of medicine at GWU.

"Our current system is very reactionary," Mintz told UPI. "If we set up a system that encourages (preventative) behavior, I think that we'd all be better off and costs would go down."

Clinton pointed to insurance companies as one of the main culprits behind the lack of pre-emptive care.

"Many insurance companies won't pay for someone who's pre-diabetic or who's been diagnosed with diabetes to go to a nutritionist to learn how to eat properly, to get preventive medicine or to go to a podiatrist to have their feet checked," she said. "But the companies will pay if you have to have your foot amputated."

Not surprisingly, insurance companies disagree.

"For a very long time, the (insurance) industry has had a very strong focus on prevention," said Mohit Ghose, vice president of public affairs for America's Health Insurance Plans, a trade group representing insurance companies. "There are millions of Americans that today have access to disease management programs that our industry has basically pioneered."