Readability, Contracts of Recurring Use, nd the Problem of Ex Post Judicial Governance of Health Insurance Policies

While the rhetoric surrounding the passage of the Patient Protection and Affordable Care Act focused on core issues such as cost, quality, and access to care, the dialog rarely acknowledged a key problem-the fact that most Americans do not understand their health insurance. Simply put, consumers do not fully grasp their health insurance coverage because the jargon found in many health insurance contracts is impenetrable to most Americans. This is disconcerting because consumer-oriented information is central to our increasingly consumer-directed health care system. Consumers are expected to make cost-effective choices among the array of health insurance plans that may be available to them, utilize health care services in a cost-effective manner, navigate provider networks, minimize their out-of-pocket expenses, and effectively appeal denials of coverage. Furthermore, unlike other types of insurance agreements, health insurance policies are contracts of recurring use. That is, health insurance policies are routinely and repeatedly invoked by consumers to finance their health care. Yet, such contracts are written at a level that is beyond the reading skills of most Americans. As such, insureds not only have difficultly understanding the details of their coverage, they do not fully comprehend the benefits and rights afforded by the policy. Consequently, the traditional approach of ex post judicial governance of insurance agreements (as adhesion contracts) by interpreting ambiguities in favor of insureds provides inadequate protection for health insurance consumers. If consumers do not understand their coverage rights and benefits, they cannot reasonably be expected to know when those benefits have been wrongly denied. The better, ex ante solution is to make health insurance contracts readable in the first instance by requiring that health insurance contracts meet an eighth grade readability standard as a condition of state approval

New Keynesian Versus Old Keynesian Government Spending Multipliers

Renewed interest in fiscal policy has increased the use of quantitative models to evaluate policy. Because of modelling uncertainty, it is essential that policy evaluations be robust to alternative assumptions. We find that models currently being used to evaluate fiscal policy stimulus proposals are not robust. Government spending multipliers in an alternative empirically-estimated and widely-cited new Keynesian model are much smaller than in these old Keynesian models; the estimated stimulus is extremely small with GDP and employment effects only one-sixth as large and with private sector employment impacts likely to be even smaller.Keynesianism, fiscal policy, fiscal stimulus, multiplier

Fiscal consolidation strategy : [Version 21 September 2012]

In the aftermath of the global financial crisis and great recession, many countries face substantial deficits and growing debts. In the United States, federal government outlays as a ratio to GDP rose substantially from about 19.5 percent before the crisis to over 24 percent after the crisis. In this paper we consider a fiscal consolidation strategy that brings the budget to balance by gradually reducing this spending ratio over time to the level that prevailed prior to the crisis. A crucial issue is the impact of such a consolidation strategy on the economy. We use structural macroeconomic models to estimate this impact focussing primarily on a dynamic stochastic general equilibrium model with price and wage rigidities and adjustment costs. We separate out the impact of reductions in government purchases and transfers, and we allow for a reduction in both distortionary taxes and government debt relative to the baseline of no consolidation. According to the model simulations GDP rises in the short run upon announcement and implementation of this fiscal consolidation strategy and remains higher than the baseline in the long run. We explore the role of the mix of expenditure cuts and tax reductions as well as gradualism in achieving this policy outcome. Finally, we conduct sensitivity studies regarding the type of model used and its parameterization

Fiscal consolidation strategy

In the aftermath of the global financial crisis and great recession, many countries face substantial deficits and growing debts. In the United States, federal government outlays as a ratio to GDP rose substantially from about 19.5 percent before the crisis to over 24 percent after the crisis. In this paper we consider a fiscal consolidation strategy that brings the budget to balance by gradually reducing this spending ratio over time to the level that prevailed prior to the crisis. A crucial issue is the impact of such a consolidation strategy on the economy. We use structural macroeconomic models to estimate this impact focussing primarily on a dynamic stochastic general equilibrium model with price and wage rigidities and adjustment costs. We separate out the impact of reductions in government purchases and transfers, and we allow for a reduction in both distortionary taxes and government debt relative to the baseline of no consolidation. According to the model simulations GDP rises in the short run upon announcement and implementation of this fiscal consolidation strategy and remains higher than the baseline in the long run. We explore the role of the mix of expenditure cuts and tax reductions as well as gradualism in achieving this policy outcome. Finally, we conduct sensitivity studies regarding the type of model used and its parameterization

New Keynesian versus old Keynesian government spending multipliers

Renewed interest in fiscal policy has increased the use of quantitative models to evaluate policy. Because of modeling uncertainty, it is essential that policy evaluations be robust to alternative assumptions. We find that models currently being used in practice to evaluate fiscal policy stimulus proposals are not robust. Government spending multipliers in an alternative empirically-estimated and widely-cited new Keynesian model are much smaller than in these old Keynesian models; the estimated stimulus is extremely small with GDP and employment effects only one-sixth as large

Fiscal consolidation strategy: An update for the budget reform proposal of march 2013

Recently, we evaluated a fiscal consolidation strategy for the United States that would bring the government budget into balance by gradually reducing government spending relative to GDP to the ratio that prevailed prior to the crisis (Cogan et al, JEDC 2013). Specifically, we published an analysis of the macroeconomic consequences of the 2013 Budget Resolution that was passed by the U.S. House of Representatives in March 2012. In this note, we provide an update of our research that evaluates this year’s budget reform proposal that is to be discussed and voted on in the House of Representative in March 2013. Contrary to the views voiced by critics of fiscal consolidation, we show that such a reduction in government purchases and transfer payments can increase GDP immediately and permanently relative to a policy without spending restraint. Our research makes use of a modern structural model of the economy that incorporates the long-standing essential features of economics: opportunity costs, efficiency, foresight and incentives. GDP rises because households take into account that spending restraint helps avoid future increases in tax rates. Lower taxes imply less distorted incentives for work, investment and production relative to a scenario without fiscal consolidation and lead to higher growth

Autonomous nutrient detection for water quality monitoring

The ever increasing demand for real time environmental monitoring is currently being driven by strong legislative and societal drivers. Low cost autonomous environmental monitoring systems are required to meet this demand as current monitoring solutions are insufficient. This poster presents an autonomous nutrient analyser platform for water quality monitoring. Results from a field trial of the nutrient analyser are reported along with current work to expand the range of water quality targets

Next generation autonomous chemical sensors for environmental monitoring

Microfluidic technology has great potential to fulfil the increasing demand for environmental monitoring. Through the minimisation of reagents, standard solutions and power consumption, compact autonomous instruments have been developed to perform in situ monitoring of remote locations over long deployable lifetimes. The objective of this research is to produce autonomous chemical sensing platforms with a price performance index that creates a significant impact on the existing market. The main focus is on developing a detection platform for ammonium, nitrate and nitrite for water and wastewater using colorimetric techniques. The goal is to integrate polymer actuators valves into the microfluidic chip, to drive down the overall cost

New Keynesian versus old Keynesian government spending multipliers

Renewed interest in fiscal policy has increased the use of quantitative models to evaluate policy. Because of modelling uncertainty, it is essential that policy evaluations be robust to alternative assumptions. We find that models currently being used in practice to evaluate fiscal policy stimulus proposals are not robust. Government spending multipliers in an alternative empirically-estimated and widely-cited new Keynesian model are much smaller than in these old Keynesian models; the estimated stimulus is extremely small with GDP and employment effects only one-sixth as large. JEL Classification: C52, E62fiscal multiplier, Fiscal Stimulus, government spending, Macroeconomic Modeling, New Keynesian Model

Out of Step, Out of Office: Electoral Accountability and House Members’ Voting

Does a typical House member need to worry about the electoral ramifications of his roll-call decisions? We investigate the relationship between incumbents’ electoral performance and roll-call support for their party—controlling for district ideology, challenger quality, and campaign spending, among other factors—through a series of tests of the 1956–1996 elections. The tests produce three key findings indicating that members are indeed accountable for their legislative voting. First, in each election, an incumbent receives a lower vote share the more he supports his party. Second, this effect is comparable in size to that of other widely recognized electoral determinants. Third, a member’s probability of retaining office decreases as he offers increased support for his party, and this relationship holds for not only marginal, but also safe members