Relative Value Health Insurance: A Behavioral Law and Economics Solution to the Medical Care Cost Crises

Now that the Supreme Court has upheld the constitutionality of the Patient Protection and Affordable Care Act (“PPACA”), access to medical care will sharply increase.  But the new law will do little to reign in the rapidly increasing cost of medical care in the United States.  Regulatory controls on prices or benefits, favored by some on the left, are political non-starters in today’s environment. Consumer directed health care (“CDHC”) proposals, which seek to provide patients with financial incentives to equate marginal costs and benefits at the point of treatment and is favored by many on the right, is infeasible because of the skewed distribution of health care expenses and patient bounded rationality. New approaches are desperately needed.This article proposes a government-facilitated but market-based approach to improvingefficiency in the market for medical care that I call “relative value health insurance.”  The approach would enable even boundedly-rational patients to contract for the efficientlevel of health care services ex ante through their health insurance purchase decisions.The key to facilitating efficient contracting by boundedly-rational consumers is thecreative use of comparative effectiveness research (“CER”), which the PPACA funds at a significant level for the first time. CER should be used to create public ratings ofmedical treatments on a scale of 1-10 based on their relative value, taking into accountcosts and expected benefits.  These relative value ratings would enable consumers tocontract with insurers for different levels of medical care at different prices, reflecting different cost-quality tradeoffs.After situating the concept of relative value health insurance within the context of ahealth insurance system that encourages overuse of resources and CDHC proposals that cannot mitigate the problem, the article describes the considerable benefits of relativevalue health insurance  and considers some of the formidable obstacles to making it areality

Relative Value Health Insurance: A Behavioral Law and Economics Solution to the Medical Care Cost Crises

Now that the Supreme Court has upheld the constitutionality of the Patient Protection and Affordable Care Act (“PPACA”), access to medical care will sharply increase.  But the new law will do little to reign in the rapidly increasing cost of medical care in the United States.  Regulatory controls on prices or benefits, favored by some on the left, are political non-starters in today’s environment. Consumer directed health care (“CDHC”) proposals, which seek to provide patients with financial incentives to equate marginal costs and benefits at the point of treatment and is favored by many on the right, is infeasible because of the skewed distribution of health care expenses and patient bounded rationality. New approaches are desperately needed.This article proposes a government-facilitated but market-based approach to improvingefficiency in the market for medical care that I call “relative value health insurance.”  The approach would enable even boundedly-rational patients to contract for the efficientlevel of health care services ex ante through their health insurance purchase decisions.The key to facilitating efficient contracting by boundedly-rational consumers is thecreative use of comparative effectiveness research (“CER”), which the PPACA funds at a significant level for the first time. CER should be used to create public ratings ofmedical treatments on a scale of 1-10 based on their relative value, taking into accountcosts and expected benefits.  These relative value ratings would enable consumers tocontract with insurers for different levels of medical care at different prices, reflecting different cost-quality tradeoffs.After situating the concept of relative value health insurance within the context of ahealth insurance system that encourages overuse of resources and CDHC proposals that cannot mitigate the problem, the article describes the considerable benefits of relativevalue health insurance  and considers some of the formidable obstacles to making it areality

A reciprocidade nos contratos: uma análise expressivista Contractual reciprocity: an expressivist analysis

Este artigo se propõe a determinar por que a legislação contratual deve expressar o valor da reciprocidade.embora muito se venha debatendo sobre ajustiça ou oequilíbrio nos contratos e aproibição à estipulação de cláusulas abusivas, pouca atenção tem sido dispensada às questões de saber se e por que é importante que o valor da reciprocidade seja incorporado ao conteúdo expressivo da legislação contratual, isto é, que a lei, ao regrar a atividade contratual, torne patente sua adesão ao valor da reciprocidade como justiça nas trocas ou recusa à exploração de uma das partes pela outra. Segundo se defende aqui, a expressão legal do valor da reciprocidade-que pode acontecer se ja por intermédio de um princípio geral de equanimidade contratual, seja por requerimentos mais específicos, tais como o da observância do preço médio (ou&#8220;preço de mercado) ou o da não estipulação de certas cláusulas - é importante por duas ordens de razões. Primeiro, o fato de a lei expressar o valor da reciprocidade é de se considerar importante porque o conteúdo expressivo da lei - aquilo que a lei expressa - é intrinsecamente importante. No caso da reciprocidade, sustenta-se mais adiante que a lei, ao manifestar o anseio de que haja certo ajuste entre o sacrifício realizado e a vantagem obtida pelos contratantes, acaba, indiretamente, por proclamar ideais mais basilares de igualdade e fraternidade. Em segundo lugar, a expressão em lei do valor da reciprocidade é importante devido às suas consequáncias. Essas consequáncias não se limitam às que resultem de limites impostos à liberdade contratual ou à recusa do órgão judicial a executar contrato siníquos, já que o endosso legal ao valor da reciprocidade pode influir sobre as razões de agir dos contratantes, contribuindo para que,ao invés de agir apenas para a maximização do próprio ganho, eles incluam a satisfação do interesse da contraparte entre as razões de suas decisões. o artigo foi organizado da seguinte maneira. após a introdução, que contém breves notas sobre o expressivismo jurídico, a parte II oferece uma definição geral e algumas concepções mais precisas acerca da reciprocidade nos contratos. em relação a cada uma dessas concepções, referem-se algumas dificuldades ou inconvenientes, ligados, sobretudo, à tentativa de fazer valer a reciprocidade por meio de restrições à eficácia legal de contratos espontaneamente celebrados. a parte III é dedicada às duas formas de análise da expressão legal do valor da reciprocidade, correspondentes às duas formas de expressivismo antes referidas; trata, portanto, a uma, de definir por que a expressão em lei do valor da reciprocidade nos contratos é intrinsecamente importante e, a duas, de aventar que consequáncias essa expressão pode ter - com especial atenção, no último caso, à eventual influáncia que o acréscimo simbólico do valor da reciprocidade à legislação contratual pode exercer sobre as razões de agir dos contratantes. na parte IV, comparam-se duas maneiras pelas quais o valor da reciprocidade pode ser expresso na legislação: uma, abstrata, pela qual a reciprocidade seja proclamada sem que se faça alusão a uma concepção mais precisa sobre aquilo em que a reciprocidade consiste, e outra, concreta, na qual transpareça uma determinada concepção de reciprocidade ou uma particular demanda para a manutenção da reciprocidade em certos contratos. a parte V conclui o artigo com algumas sugestões para a pesquisa futura.<br>This paper tries to establish why the law of contracts should express the value of reciprocity. Although scholars have intensively discussed equality in exchange and the prohibition of unfair terms in contracts, few attention has been paid to the questions of knowing if and why it matters that the value of reciprocity be incorporated to the expressive content of contract law, that is, that the law, through the regulation of contractual activity, makes clear its adhesion to the value of reciprocity as equality in exchange or denying of exploitation of one of the parties by the other. The paper argues that the legal expression of the value of reciprocity - which may take place through either a general principle of contractual equality or more specific requirements, as such that of complying with the mean price (or &#8220;market price&#8221;) or that of not establishing certain clauses - is important for two kinds of reasons. first, the expression by the law of the value of reciprocity should be deemed important because the expressive content of the law is intrinsically important. in the case of reciprocity, it is argued that the law, as it manifests the wish that there be some correspondence between the sacrifice made and the advantage obtained by each party, ends up proclaiming, indirectly, The more basic values of equality and fraternity. Second, the legal expression of the value of reciprocity is important in face of its consequences. These consequences are not circumscribed to the ones coming from limits imposed to the freedom of the contractual parties or to the refusal of the courts to enforce unfair contracts, since the legal endorsement of the value of reciprocity may influence the reasons for acting of the contractual parties. As a result, instead of acting only in order to maximize her own gain, each party may include the protection of the interests of the other one among the reasons of her decisions. This paper was organized as follows. After the introduction, which contains some brief remarks on legal expressivism, part II offers a broad definition and some particular conceptions of contractual reciprocity. About each one of these conceptions, some difficulties or inconveniences, which are mostly tied to the attempt of imposing reciprocity through the restrictions of the legal efficacy of voluntarily made agreements, are referred to. Part III is dedicated to two forms of surveying the legal expression of the value of reciprocity, which correspond to the two forms of expressivism before mentioned; it seeks to establish, first, why the legal expression of the value of contractual reciprocity is intrinsically important and, second, to estimate which consequences that expression may have - with particular attention, in this last case, to the eventual influence that the symbolic addition of the value of reciprocity to the law of contracts may exercise over the reasons for acting of the contractual parties. In part IV, two ways by which the value of reciprocity can be expressed through law are compared: one, abstract, by which reciprocity is proclaimed without allusion to a more precise conception about what reciprocity is, and other, concrete, which reveals a certain conception of reciprocity or a particular requirement to observe reciprocity in some contracts. part V concludes the paper with some suggestions for future research