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Katherine Baicker

Katherine Baicker. Professor of Health Economics, Harvard School of Public Health. Implementation of the ACA: Insurance Expansions and the Value of Care. Two Goals of Health Reform. Covering the almost 50 million uninsured Problem exacerbated by economy and rising costs

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Katherine Baicker

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  1. Katherine Baicker Professor of Health Economics, Harvard School of Public Health Implementation of the ACA: Insurance Expansions and the Value of Care

  2. Not for Citation or Distribution Two Goals of Health Reform • Covering the almost 50 million uninsured • Problem exacerbated by economy and rising costs • Goal of improving access and outcomes • Bringing spending growth under control • Private budgets: employees bear cost of HI • Public budgets: key driver of fiscal outlook; tax burden • Recent slowdown gives some hope, but causes unclear

  3. Not for Citation or Distribution High Spending ↔ High Value? • Stemming spending growth focus of reform debate, but right metric? • Reasons we might want to spend more & reasons for concern • Consequence of low-value spending • Productive and allocative inefficiency • Strained public budgets, tax pressures • Underlying problem: disconnect between costs and benefits • Ample evidence that we could be getting higher value

  4. Higher Spending Does Not Necessarily Lead to Higher Quality

  5. Not for Citation or Distribution Implications for Reform • How does expanding coverage affect spending and value? • Expanding coverage: Incentives and subsidies • Mandate; Medicaid expansion; Exchange subsidies; Employer requirements; Insurance market reforms • Costs and benefits of insurance expansions? • Uninsured report worse access and outcomes • But causal effects hard to nail down – magnitudes and even signs uncertain • Better evidence from randomized controlled evaluation

  6. Utilization • Increased use of many types of care • Outpatient and Rx • Hospital • Emergency department • Implied 25-35% ↑ spending for Medicaid enrollees

  7. Financial Strain • Reduction in collections, financial strain • No change in employment, earnings

  8. Health • Large improvements in self-reported health • Clinical assessments: more mixed • Depression↓(diagnosis↑) • No detectable effect on BP, HbA1c, cholesterol

  9. Not for Citation or Distribution Implications for Reform • Expanding existing plans likely to generate mix of value • Aligning patient cost-sharing with value • For insurance • Private side: Reform tax code, regulations • Public side: Improve benefit design • For care • Cost-sharing tied to value of care; wellness (inherently paternalistic) • Private side: Value-based insurance design • Public side: Rationalize cost-sharing across silos; limit gap coverage

  10. Not for Citation or Distribution Implications for Reform • Potential for ACA • Public side • Integrated plans like ACOs could facilitate patient choice and competition • Innovative coordinated care could improve value • Private side • Exchanges could promote competition based on value • Enrollment challenges threaten future risk-pooling and premium stability • Will have to wrestle with tough choices • Reform doesn’t pay for itself • Tough choices about whom and what services to cover/subsidize

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