For years, progressives have claimed that they are the party of science. “Our government has forced what I believe is a false choice between sound science and moral values. . . . I believe the two are not inconsistent,” said President Obama in 2009. Science is the reason we need to suppress trillions of dollars of economic activity around the world, because Al Gore — and science! — tell us that if we don’t, “our planet will experience cataclysmic warming by the end of the century.” Gore has even taken to calling conservative climate-policy skeptics “climate deniers,” a clear reference to Holocaust deniers. But there is at least one area of public policy where the Left has abandoned its rhetorical allegiance to science: health care.
We found no significant effect of Medicaid coverage on the prevalence or diagnosis of hypertension or high cholesterol levels or on the use of medication for these conditions. Medicaid coverage significantly increased the probability of a diagnosis of diabetes and the use of diabetes medication, but we observed no significant effect on average glycated hemoglobin levels or on the percentage of participants with levels of 6.5% or higher. Medicaid coverage decreased the probability of a positive screening for depression (−9.15 percentage points; 95% confidence interval, −16.70 to −1.60; P=0.02), increased the use of many preventive services, and nearly eliminated catastrophic out-of-pocket medical expenditures.
Medicare is referring to the newly created Center for Medicare and Medicaid Innovation, which gives the program power to create and expand projects without congressional authorization. This authority could also be used to create projects based on HQP’s lessons. It’s not. Instead, Medicare has created a raft of projects and experiments meant to move the system from fee-for-service toward pay-for-quality — with the hope that if they can get the payment incentives right, then the market will have reason to support programs like HQP.
To Health Quality Partners and its defenders, Medicare’s decision is ludicrous. “We’re spending tens of billions of dollars now on Medicare innovation where Medicare already discovered something amazing and now they’re forgetting what they discovered?” Brenner says. “It’s an amazing government moment.”
Unions and Innovation: New Insights from the Cross‐Country Evidence by Chris (Hristos) Doucouliagos, Patrice Laroche :: SSRNMarch 21, 2013
We apply meta‐regression analysis to the extant econometric studies and find that unions depress investment in innovation at the firm and industry level in all countries considered. However, this adverse effect has been declining over time and is moderated by country differences in industrial relations and regulations: The adverse effect appears to increase with labor market flexibility.
One of the less palatable ideas proposed in the plan was to impose Medicaid drug rebates (price controls, in reality) for Medicare Part D for the dual-eligible population (those who are eligible for Medicaid and Medicare coverage). While it’s been estimated that this plan could save $49 billion in Medicare spending, the impact on innovation could be significant – cutting prices for drugs dampens the incentive for drug companies to innovate. The dual-eligible population in particular often suffers chronic conditions for which innovative medicines are in short supply – these rebates wouldn’t be of much help.
But bad ideas are like a boomerang – they always seem to return.
In his State of the Union address, President Obama characterized the price Medicare pays for drugs as subsidy to the pharmaceutical industry:
On Medicare, I’m prepared to enact reforms that will achieve the same amount of health care savings by the beginning of the next decade as the reforms proposed by the bipartisan Simpson-Bowles commission…We’ll reduce taxpayer subsidies to prescription drug companies
To put it simply, paying the market price for a drug isn’t a subsidy – it’s business.
Analyzing the Effects of Insuring Health Risks: On the Trade-Off between Short Run Insurance Benefits vs. Long Run Incentive Costs by Harold Cole, Soojin Kim, Dirk Krueger :: SSRNFebruary 17, 2013
This paper constructs a dynamic model of health insurance to evaluate the short- and long run effects of policies that prevent firms from conditioning wages on health conditions of their workers, and that prevent health insurance companies from charging individuals with adverse health conditions higher insurance premia. Our study is motivated by recent US legislation that has tightened regulations on wage discrimination against workers with poorer health status (Americans with Disability Act of 2009, ADA, and ADA Amendments Act of 2008, ADAAA) and that will prohibit health insurance companies from charging different premiums for workers of different health status starting in 2014 (Patient Protection and Affordable Care Act, PPACA). In the model, a trade-off arises between the static gains from better insurance against poor health induced by these policies and their adverse dynamic incentive effects on household efforts to lead a healthy life. Using household panel data from the PSID we estimate and calibrate the model and then use it to evaluate the static and dynamic consequences of no-wage discrimination and no-prior conditions laws for the evolution of the cross-sectional health and consumption distribution of a cohort of households, as well as ex-ante lifetime utility of a typical member of this cohort. In our quantitative analysis we find that although a combination of both policies is effective in providing full consumption insurance period by period, it is suboptimal to introduce both policies jointly since such policy innovation induces a more rapid deterioration of the cohort health distribution over time. This is due to the fact that combination of both laws severely undermines the incentives to lead healthier lives. The resulting negative effects on health outcomes in society more than offset the static gains from better consumption insurance so that expected discounted lifetime utility is lower under both policies, relative to only implementing wage nondiscrimination legislation.
Young Adulthood, Dependent Coverage, and Health: The Immediate Effects of the Patient Protection and Affordable Care Act on the Well-Being of 19-25 Year Olds by Daniel Carlson, Ben Kail, Jamie Lynch, Marlaina Dreher :: SSRNFebruary 13, 2013
Objectives: This study examines the health impact of the Patient Protection and Affordable Care Act (ACA) dependent coverage provision for U.S. young adults ages 19-25.
Methods: Multinomial logistic and OLS regression are used to examine changes in health coverage across three time periods (Pre-Great Recession; Great Recession/Pre-ACA; Post-ACA) and the mediating effect of dependent coverage on the association between period and self-reported health. Data come from the Current Population Survey – March Supplement for the years 2007 to 2012.
Results: Young adults were more likely to have dependent coverage in the post-ACA period compared to previous years. Young adults reported poorer health during the Great Recession/pre-ACA period compared to the years preceding and following it. Dependent health coverage was positively associated with self-reported health and accounted for a substantial portion of health differences between young adults in the pre- and post-ACA periods. No such mediating effect was found for the pre-Great Recession period relative to the pre-ACA/Great Recession period.
Conclusion: The ACA expanded access to dependent health insurance coverage for young adults, ameliorating some of the negative health consequences of the Great Recession.
via Young Adulthood, Dependent Coverage, and Health: The Immediate Effects of the Patient Protection and Affordable Care Act on the Well-Being of 19-25 Year Olds by Daniel Carlson, Ben Kail, Jamie Lynch, Marlaina Dreher :: SSRN.
Cost and Benefit of Hospital Financing System Reforms in OECD Countries by Parida Obulqasim, Werner Brouwer, Pieter Van Baal :: SSRNJanuary 29, 2013
In the past three decades, many developed countries have changed the manner in which hospitals were financed. Although it has been hypothesized that the way in which healthcare providers are reimbursed may affect their performance and thereby population health, there is little empirical literature on this. This study uses aggregate level panel data coming from 20 OECD countries covering 30 years to explore the impact of these reforms on indicators of healthcare output and mortality. We first classified hospital financing systems based on whether they depend purely on hospital characteristics (fixed budget) or also on the service they provide (activity based, AC). In a second step we tried to differentiate within activity based financing: a) fee-for-service (FFS), which is purely based on the quantity of services provided, or b) Patient-based payment (PBP), in which activities are linked to patients. The data is analysed using a standard difference-in-difference (DID) model with country and year specific fixed effects and a variant of it, which allows for a structural change in the outcome due to a reform. Although the standard DID models did not yield any significant results, the DID models allowing for structural changes in the outcome indicated that activity based financing increases the growth rate of health care output while accelerating the growth of life expectancy at age 65. Again, the standard DID model did not yield any significant results if we differentiate between FFS and PBP. However, differentiation between FFS and PBP indicated that the positive effect on life expectancy at age 65 is probably caused by PBP.
Three researchers — Peter Ubel of Duke University’s Fuqua School of Business, Brendan Nyhan of Dartmouth College and Jason Reifler of Georgia State University — set out to discover whether media fact-checking could debunk the myth of death panels. What they found is that while there is nothing in the plan resembling a death panel, the myth is unlikely to go away any time soon.
Their study, “The Hazards of Correcting Myths About Health Care Reform,” will be in the February issue of the journal Medical Care and is already available online.
There may be a debate over whether Obamacare’s individual mandate is a penalty or a tax, but there is no debate among doctors and their patients about the fact that Obamacare will be bad for America’s health.