Health Economics & Policy 3 rd Edition James W. Henderson

1. Health Economics & Policy3rd EditionJames W. Henderson Chapter 17 Medical Care Reform in the United States

2. The Push for Reform • Polls show satisfaction and unease • Forces behind reform movement • Advocates for elderly, poor, uninsured • Middle class • Rising out-of-pocket cost • Health insurance link with employment • Business • Rising cost creates wedge between cost of employment and salary paid • Potential liability risk

3. The Moral Issues • Is medical care a right? • What is a right? • Difference between a right and an entitlement

4. Goals of Reform • Who’s covered • What’s covered • Who pays and how much

5. Health Insurance in the United States • Employer-based group plans • Individual insurance • Government entitlements

6. Market Access Problem • Uninsured find it difficult to find willing providers • Insured find themselves underinsured

7. Health Insurance Regulations • Federal responsibility • ERISA • Federal mandates • States’ responsibilities • Health insurance mandates

8. Economics of Mandates • Correct perceived deficiencies in health insurance market • Tendency to undervalue certain types of benefits • Mental health • Long-term care • Adverse selection • Tendency for high-risk users to enroll in high benefit plans and low-risk users to enroll in low benefit plans • Viewed by state policy makers as a low cost way of improving access • Empirical evidence

9. Types of Mandates • Benefits • Providers • Persons • Processes

10. Benefit Mandates • Alcoholism treatment • Drug abuse treatment • Oral contraceptives • Mammography screening • Prostate cancer screening • Well-child care

11. Provider Mandates • Chiropractors • Dentists • Nurse practitioners • Psychologists

12. Covered Persons Mandates • Adopted children • Newborns • Handicapped children • Dependent students

13. Process Mandates • Guaranteed issue • Exclusions of preexisting conditions • Premium caps • Guaranteed renewable

14. U.S. Policy Alternatives • State-level experiments • Federal involvement • Market alternatives

15. State-level Experiments • Hawaii • Oregon • Minnesota • Other states

16. Federal Involvement • Universal coverage • Single-payer • Employer mandate • Individual mandate • Universal access

17. America’s Market Orientation • Distrust of government • Heterogeneous population • Individualistic tradition • Equal opportunity • Philanthropic tradition

18. Conditions for Market Response • Prerequisites • Rank preferences • Goods to buy • Money to spend • Cost-conscious behavior • When purchasing insurance plan • When purchasing medical services

19. Market Alternatives • Managed competition • Medical savings accounts

20. Immediate Prospects • Medicare reform • Patients’ bill of rights • Health care for the uninsured • Pharmaceutical drug pricing