Comments on Enthoven’s “The U.S. Experience with Managed Care and Managed Competition”

This session will provide an overview of the U.S. health care system with an emphasis on trends observed since the reforms of the early 1990s. ; How has the health care system adjusted to the introduction of market-oriented medicine? And what have been the consequences for access to care, health care costs (public and private), and the quality of care over the past decade? How does the U.S. health care system measure up in international comparisons, for instance? Does managed care work as its advocates expected or have inappropriate consumer and provider incentives undermined this experiment? What are the implications for reform?Health care reform

Value‐Based Insurance Design: More Health at Any Price

Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/90286/1/hesr1358.pd

A New Medicare End-of-Life Benefit for Nursing Home Residents

A new Medicare benefit is needed to support end-of-life care for those spending their final days in a nursing home, say the authors of this article. Arguing that the current hospice benefit is a poor fit with the nursing home setting, the authors recommend a new benefit that would enable nursing home residents to receive individualized palliative and psychosocial services in addition to rehabilitative services

Quality and Employers' Choice of Health Plan

We seek to understand the relationship between employer decisions regarding which health plans firms choose to offer to their employees and the performance of those plans. We measure performance using data from the Health Plan Employer Data Information Set (HEDIS) and the Consumer Assessment of Health Plan Survey (CAHPS). We use a unique data set that lists the Health Maintenance Organizations (HMOs) available to, and offered by, large employers across markets in the year 2000, and examine the relationship between plan offerings, performance measures and other plan characteristics. We estimate two sets of specifications that differ in whether they model plan choice as a function of absolute plan performance or plan performance relative to competitors. We find that employers are more likely to offer plans with strong absolute and relative HEDIS and CAHPS performance measures. Our results are consistent with the view that large employers are responsive to the interests of their employees.

Health Savings Account - Eligible High Deductible Health Plans: Updating the Definition of Prevention

High-deductible health plans (HDHPs) are an important and growing part of the health insurance landscape. By some estimates, as many as 80 percent of large employers may offer an HDHP in 2014. In 2013, more than 15 million Americans received health coverage through an HDHP, a more than a threefold increase since 2007.As outlined by the U.S. Treasury Department, individuals with an HSA-eligible HDHP are required to pay the full cost of most medications and services -- in theory utilizing pre-tax HSA funds -- until deductibles are met. However, the 2003 authorizing legislation and further guidance include a safe harbor allowing plans to cover primary preventive services, those typically deemed to prevent the onset of disease, before the deductible is satisfied.Services or benefits meant to treat "an existing illness, injury or condition," are excluded from first-dollar coverage in HSA-eligible HDHPs, which encompasses most secondary preventive services. For example, plans are prohibited from providing first dollar coverage of disease management services such as insulin, eye and foot exams, and glucose monitoring supplies for patients with diabetes.As chronic disease conditions currently make up 75 percent of total U.S. health spending, appropriate chronic disease management is an important tool to lower long-term health care costs. As the market for HDHPs grow, it is important that they maintain the flexibility to allow for effective health management of all beneficiaries. This report addresses the strict definition of prevention that an HDHP must follow for it to include a pre-tax health savings account (HSA), and how this restriction limits the effectiveness of current plans. A potential solution - allowing HSA-eligible HDHPs to provide first-dollar coverage for targeted, evidence-based, secondary preventive services that prevent chronic disease progression and related complications - can improve patient-centered outcomes, add efficiency to medical spending, and enhance HDHP attractiveness.A multi-disciplinary research team from the University of Michigan's Center for Value-Based Insurance Design, Harvard Medical School, and the University of Minnesota conducted a multi-part project to investigate the impact of updatingthe definition of prevention for HDHPs to include selected secondary preventive services that are frequently used as health plan quality metrics and included as elements of pay-for-performance programs. Specifically, the project aimed to: 1) determine the premium effect, actuarial value, and estimated market uptake of the novel HDHP plan that covers these evidence-based services outside the deductible, and 2) explore through interviews whether insurance industry experts found coverage of secondary preventive services a worthwhile endeavor

Insurance loss coverage under restricted risk classification: The case of iso-elastic demand

This paper investigates equilibrium in an insurance market where risk classification is restricted. Insurance demand is characterised by an iso-elastic function with a single elasticity parameter. We characterise the equilibrium by three quantities: equilibrium premium; level of adverse selection (in the economist’s sense); and “loss coverage”, defined as the expected population losses compensated by insurance. We consider both equal elasticities for high and low risk-groups, and then different elasticities. In the equal elasticities case, adverse selection is always higher under pooling than under risk-differentiated premiums, while loss coverage first increases and then decreases with demand elasticity. We argue that loss coverage represents the efficacy of insurance for the whole population; and therefore that if demand elasticity is sufficiently low, adverse selection is not always a bad thing

Charity Care, Risk Pooling, and the Decline in Private Health Insurance

Economic

Measuring Health Care Costs of Individuals with Employer-Sponsored Health Insurance in the U.S.: A Comparison of Survey and Claims Data

As the core nationally representative health expenditure survey in the United States, the Medical Expenditure Panel Survey (MEPS) is increasingly being used by statistical agencies to track expenditures by disease. However, while MEPS provides a wealth of data, its small sample size precludes examination of spending on all but the most prevalent health conditions. To overcome this issue, statistical agencies have turned to other public data sources, such as Medicare and Medicaid claims data, when available. No comparable publicly available data exist for those with employer-sponsored insurance. While large proprietary claims databases may be an option, the relative accuracy of their spending estimates is not known. This study compared MEPS and MarketScan estimates of annual per person health care spending on individuals with employer-sponsored insurance coverage. Both total spending and the distribution of annual per person spending differed across the two data sources, with MEPS estimates 10 percent lower on average than estimates from MarketScan. These differences appeared to be a function of both underrepresentation of high expenditure cases and underestimation across the remaining distribution of spending.