A holistic assessment of the labor market effects of minimum wage regulation requires understanding employer compliance. The economics literature has paid little attention to this issue. We investigate how minimum wage increases and the strength of enforcement regimes affect the prevalence of subminimum wage payments. We find strong evidence that higher minimum wages lead to a greater prevalence of subminimum wage payments. We consistently estimate that increases in measured underpayment following minimum wage increases average between 10 and 25 percent of realized wage gains. We interpret this as evidence that minimum wage evasion and avoidance are an important reality in the low-wage labor market. Finally, we find that enforcement regimes play an important role in shaping both baseline compliance rates and the response of compliance to increases in minimum wages.
Exploring the Taxation of New York’s New Paid Family Medical Leave Benefit by Richard Barnes :: SSRNJanuary 2, 2019
This article examines the taxation of benefits received under New York’s new Paid Family Leave Act. The article argues that New York’s Paid Family Leave Act is unique when compared to similar provisions enacted in other states to date and that benefits paid under the tax are excluded from federal gross income by operation of Internal Revenue Code Sections 104 and 105. Additionally, the article contends that New York’s Department of Taxation and Finance’s Notice N-17-12 errs in concluding that amounts paid under the Act are includible in federal gross income. The article contends that insurance policies issued in compliance with the Act are “health insurance” and that income replacement benefits paid under the Act are paid for “sickness” as described in Code Sections 104 and 105.
Calling healthcare a “basic human right” may make an advocate feel more politically virtuous and caring. Nevertheless, the phrase oversimplifies and stunts the necessary debate remaining over how our healthcare system should and could operate better.
The rights-based approach to healthcare reform remains wrong as a matter of U.S. law, history, politics and economics. We can do better than just recycle another round of these empty words.
Scientific Misconduct: The Manipulation of Evidence for Political Advocacy in Health Care – Policy & MedicineJuly 28, 2019
A recent paper from the CATO Institute, titled “Scientific Misconduct The Manipulation of Evidence for Political Advocacy in Health Care and Climate Policy,” highlighted how “science is increasingly being manipulated” based on the political choices and ethical preferences of those who are willing to suppress evidence of conflict between those preferences and the underlying reality.
Written by George Avery, PhD, MPA, an assistant professor of public health in the Department of Health and Kinesiology and the Regenstrief Center for Health Care Engineering at Purdue University, the article discusses how in health care policy, critics have long worried about the inordinate influence of pharmaceutical and medical device manufacturers on research to show the safety and viability of new products.
Issue No. 49: Should Politically Appointed State Boards Determine Drug Prices? – Cost-of-Health-Care NewsJuly 21, 2019
Maryland last month became the first state to establish a board to set maximum prices for drugs purchased by state and local governments; shortly thereafter, Maine became the second.
According to a survey by the National Academy for State Health Policy(NASHP), attempts to establish price-review boards in two states (Illinois and Connecticut) failed, but in five others (Massachusetts, Minnesota, New Jersey, Oregon, and Missouri) legislation has been referred to relevant committees.
To keep track of all the fast moving developments, STAT has detailed the major proposals pending before the Trump administration and in Congress that aim to lower prescription drug prices — along with those that have already been abandoned, blocked, or softened.
But although the Democratic pro-ACA appellants cannot have been encouraged by the tone and scope of yesterday’s questioning, it remains a giant leap further ahead to envision a ruling that would overturn the entire ACA on nonseverable constitutional grounds. That’s just too much of a stretch, under standard severability analysis, to argue that the congressional findings of fact in 2010 actually intertwined the individual mandate with much more than a limited set of insurance-coverage-related ACA provisions (guaranteed issue, adjusted community rating, and perhaps minimum essential benefits at most). And even if the Fifth Circuit panel (or a later en banc review) decides to produce a scrambled mess, the Supreme Court and its chief umpire John Roberts (who has a tight strike zone for ACA legal challenges) remain poised to clean up Humpty Dumpty.
Bill Gates Posts Data Of Causes Of Death In The US, Is Amazed By The Disconnect Between News And Reality | Bored PandaJuly 10, 2019
The data that Bill Gates tweeted comes from a project, titled Death: Reality vs. Reported, by students of the University of California San Diego. The researchers attempted to answer these questions: how do people die, how do people think they die, and is there a difference. To get some answers, they set out to investigate if there’s a disconnect between what one sees in the news and what happens in reality.
For their project, the students look at four sources: The Center for Disease Control’s WONDER database for public health data (1999-2016), Google Trends search volume (2004-2016), The Guardian’s article database, and The New York Times’ article database. “For all of the above data, we looked at the top 10 largest causes of mortality, as well as terrorism, overdoses, and homicides, three other causes of death which we believe receive a lot of media attention,” they wrote. For each, the relative share of deaths, share of Google searches, and share of media coverage, were calculated.
Below, I show a reasonable projection of the share of national income that will have to be spent paying for these obligations in the future if there is no substantial restructuring of liabilities. It’s based on consensus forecasts from groups such as the Congressional Budget Office and the Office of Management and Budget for economic growth and for programs such as Social Security and Medicare where such forecasts are available—but in some cases, such as state debts and pensions, no such forecast was available, and so I developed a simple one.
Editor’s note: the graph rises from roughly 3% of GDP in 1950 to nearly 20% of GDP by 2040.