"Caring for a Large Geriatric Generation: The Coming Crisis in U.S. Health Care"

The time has more than come to begin planning seriously for the aging of the baby boom generation. The need for planning goes beyond concerns about the solvency of Social Security and Medicare. Another crisis looms in the form of a huge bill for the care of baby boomers who in their old age will need help dressing, eating, taking medication, and performing other daily tasks. Under the current system, most nursing home care is paid for by Medicaid-a program designed primarily to subsidize the acute care of indigent families. This arrangement diverts health care resources from their intended use, thwarts the development of a long-term-care insurance system, and provides meager resources to heavily burdened providers, forcing them to skimp on care needed by a vulnerable population.

"Can The Expansion Be Sustained? A Minskian View"

Hyman P. Minsky's insights into the relationship between profits, economic growth, and the public and private financial balances are particularly relevant to today's conditions. How can a Minskian view be applied to explain the processes that brought the economy to its current state and to recommend a policy stance for the future?

"An Ethical Framework for Cost-Effective Medicine: Confronting the Risks in Managed Care"

This paper looks at the ethical problems posed by managed care (in particular, at its incentives to physicians to economize on care), and points to a regulatory framework to provide consumer protection. HMO medicine has been effective in controlling once runaway health care costs. But it sets up inevitable conflict between patient care and the financial well-being of the health plan and of its employee or contract physicians. The trend to capitated payments is especially problematic. It relieves the insurer from interfering in medical decision-making as a means of cost-control, but it pits the interests of physicians directly against the interest of patients. Policy makers, the finding is, should not try to micro-manage HMO medicine, which they have done by mandating, for example, minimal hospital stays after childbirth. The real need is for regulatory oversight of financial incentives and disclosure. Health plans ought to be required to disclose the incentives under which their physicians are paid; to provide subscribers with honest information on health care coverage; and to be prohibited from imposing "gag rules" on physicians. Moreover, ERISA ought to be re-cast to hold health plans accountable for errant care decisions, which they are not now in many cases. Purchasing cooperatives, the conclusion also is, would play an especially useful role if managed care continues to take hold as the institutional norm.

"Prescription for Health Care Policy, The Case for Retargeting Tax Subsidies to Health Care"

With health care delivery increasingly shaped by market and budgetary discipline, the provision of health care for all seems an ever-more-distant goal.The high cost of American health care is the inevitable by-product of its method of financing. Cadette proposes shifting the tax subsidies to health care from the tax exclusion of employment-based health insurance to an income-scaled tax credit for the individual purchase of basic health insurance. This plan holds out promise of improving the operation of the health insurance market, making the labor market more efficient, reducing overall health care costs, and providing protection for the unemployed.

Financing Long-Term Care: Options for Policy

The nation is ill-prepared to finance the quantum jump in long-term care spending that is on its way as the baby boom ages. By default rather than by design, Medicaid has become the main source of funds for long- term care. But reliance on Medicaid has fostered the institutionalization of the disabled elderly, has given rise to a two- tier care system, and has yielded the bizarre outcome of use of limited welfare funds by middle- and even high-income Americans who have succeeded in sheltering assets from Medicaid's spend-down requirements. Insurance would be a greatly better answer to the nation's long-term care needs. But the market will remain small and underdeveloped as long as Americans can make easy claim on Medicaid. The paper puts forth a plan for universal long-term care insurance, supported by income-scaled tax credits, to replace Medicaid in its current role. That would make for "honest government"—one that not only does not fund inheritance protection but also genuinely protects those with greatest need.

"Financing Long-Term Care: Options for Policy"

The nation is ill-prepared to finance the quantum jump in long-term care spending that is on its way as the baby boom ages. By default rather than by design, Medicaid has become the main source of funds for long-term care. But reliance on Medicaid has fostered the institutionalization of the disabled elderly, has given rise to a two-tier care system, and has yielded the bizarre outcome of use of limited welfare funds by middle- and even high-income Americans who have succeeded in sheltering assets from Medicaid's spend-down requirements. Insurance would be a greatly better answer to the nation's long-term care needs. But the market will remain small and underdeveloped as long as Americans can make easy claim on Medicaid. The paper puts forth a plan for universal long-term care insurance, supported by income-scaled tax credits, to replace Medicaid in its current role. That would make for "honest government"--one that not only does not fund inheritance protection but also genuinely protects those with greatest need.

"Financing Long-Term Care, Replacing a Welfare: Model with an Insurance Model"

The nation is not prepared to deal with the jump in expenditures for long-term care that will come with the aging of the baby boom generation. Only a small part of that care is paid for privately (out-of-pocket or through private insurance). Most is financed through Medicaid, the program that is intended to ensure medical care for the indigent. This use of Medicaid comes at a high cost for individuals and society: the allotment of more than a third of the Medicaid budget to long-term care; a two-tier care system; and the commandeering of limited funds by middle- and high-income people through elaborate estate planning to circumvent eligibility requirements. These problems would be mitigated by replacing the welfare model with an insurance model--voluntary or compulsory private insurance, with subsidies through income-scaled tax credits to ensure affordability. An equitable and efficient system could be created with a blend of public money, private insurance, and other private saving, with a safety net for those in greatest need