Healthy Exchange

Kevin Lewis

January 15, 2010

Group Insurance: A Better Deal For Most People Than Individual Plans

Roland McDevitt, Jon Gabel, Ryan Lore, Jeremy Pickreign, Heidi Whitmore & Tina Brust
Health Affairs, January/February 2010, Pages 156-164

This paper compares health plans currently available on the individual market with employer-sponsored plans. Points of comparison include the scope of benefits, cost-sharing provisions, premiums, expected out-of-pocket costs, and actuarial value. We draw from the 2007 KFF/HRET Health Benefits Survey, our own survey of individual-market plans, the MarketScan medical claims database, and a computer simulation of medical claims. We find that in 2007, employment-based plans covered 80 percent of all charges paid by the plan and the member, while individual plans covered 64 percent. For most people, premiums and out-of-pocket costs were more affordable in tax-advantaged employer plans than in individual-market plans. Proposed health reforms would fundamentally alter the plan offerings available to Americans, particularly those offered in the individual market.


A Comparative Study on Permissiveness Toward Euthanasia: Religiosity, Slippery Slope, Autonomy, and Death with Dignity

Ellen Verbakel & Eva Jaspers
Public Opinion Quarterly, forthcoming

This study explores explanations for the approval of euthanasia by assessing differences among individuals and countries, using four main arguments used by opponents and proponents in the public debate over euthanasia. We performed multilevel analysis on data from thirty-three countries, obtained from the European Values Study 1999/2000 and the World Values Survey 2000; we enriched these data with country-specific information. First, our results supported the hypothesis based on the religion argument: religious people and people living in a religious context are more strongly opposed to euthanasia. In addition, Protestants and people living in Protestant countries have more favorable attitudes toward euthanasia than do Catholics and people living in Catholic countries. Second, we found support for the hypothesis derived from the slippery slope argument: fear that euthanasia will be abused resulted in people from vulnerable groups and people living in countries with low-responsive health care systems being more opposed to euthanasia. Third, as the autonomy-hypothesis predicted, highly educated people and people who highly value autonomy as well as people living in a country with a stronger than average attachment to autonomy show a more favorable attitude toward euthanasia. Fourth, while the death with dignity argument predicts that people who witness unbearable suffering in their personal or national environment are more favorable toward euthanasia, our results show only weak support. Furthermore, cross-level interaction tests showed that national contexts are, to some extent, able to decrease the differences between groups in society in terms of their response to euthanasia.


The Impact of Liability on the Physician Labor Market

Eric Helland & Mark Showalter
Journal of Law and Economics, November 2009, Pages 635-663

This study examines the impact of malpractice reforms on physician behavior using a new measure of liability risk and a nationally representative, individual‐level data set on physician behavior. We match our liability measure to data on physician behavior from the Physician Practice Costs and Income Survey (PPCIS). Data from the PPCIS bracket a period of substantial state‐level legal reform between 1983 and 1988, which provides identifying variation in our liability measure. We estimate the impact of liability reform on hours worked. We find an estimated elasticity of hours worked to liability exposure of -.285 for the full sample of physicians. The effect for physicians ages 55 or older is much larger: we find an elasticity of -1.224 for this category. We find that an increase in $1 of expected liability is associated with a $.70-$1.05 increase in malpractice premiums.


Changes in Spousal Health Insurance Coverage and Female Labor Supply Decisions

Kandice Kapinos
Forum for Health Economics & Policy, 2009

This study examines the changing relationship between spousal health insurance coverage and labor market outcomes for married women over time as healthcare costs have increased. In particular, I investigate how husbands' health insurance coverage offers affect wives' decisions to enter the labor force and work full-time and how this has changed over time. I endeavor to correct for potential biases of these effects by 1) using an instrumental variables model to deal with endogeneity and 2) estimating and netting out likely unobserved heterogeneity biases, such as assortative mating or income effects. Using Current Population Survey data from 1995 to 2005, I find that husbands' employer-provided health insurance coverage has a negative effect on wives' labor supply that has increased (become more negative) over time.


Hospital Governance And The Quality Of Care

Ashish Jha & Arnold Epstein
Health Affairs, January/February 2010, Pages 182-187

Hospitals' boards may influence the quality of care that hospitals provide, but their engagement in quality-related issues is largely unknown. We surveyed a nationally representative sample of board chairs of 1,000 U.S. hospitals to understand their expertise, perspectives, and activities in clinical quality. We found that fewer than half of the boards rated quality of care as one of their two top priorities, and only a minority reported receiving training in quality. The large differences in board activities between high-performing and low-performing hospitals we found suggest that governing boards may be an important target for intervention for policymakers hoping to improve care in U.S. hospitals.


Welfare Generosity, Abortion Access, and Abortion Rates: A Comparison of State Policy Tools

Laura Hussey
Social Science Quarterly, March 2010, Pages 266-283

Objective: This article tests if welfare generosity is related to abortion rates, allowing effects to vary by program type and abortion policy context.

Methods: Measuring welfare generosity with respect to cash assistance, family caps, Medicaid, child care and family leave policies, I estimate fixed effects models of abortion rates in 48 U.S. states over 1987-2000.

Results: More expansive family leave laws are associated with lower abortion rates. In states that do not enforce any of three key abortion policies, increased Medicaid eligibility and child care spending predict higher abortion rates. For Medicaid, this relationship diminishes and reverses itself as states add abortion regulations.

Conclusion: Welfare state expansions may help reduce abortion, but programs' effects are not unambiguously pro-natalist. Estimated impacts of welfare generosity on abortion rates vary by program, and some with abortion policy context.


Lessons From Public Long-Term Care Insurance In Germany And Japan

John Creighton Campbell, Naoki Ikegami & Mary Jo Gibson
Health Affairs, January/February 2010, Pages 87-95

The U.S. Congress is considering the Community Living Assistance Services and Supports (CLASS) Act, a voluntary insurance program that would help pay for long-term services and supports to disabled Americans. In Germany and Japan, social insurance programs are universal, support family caregivers, and allow individuals considerable flexibility in securing the services they require. We explored differences between Germany and Japan in program goals, eligibility process, scope, size, and sustainability for possible applications in the United States. Moreover, when we compared public spending on long-term care, we found that spending in the United States is actually higher than in Germany even now, prior to enactment of the CLASS Act, and is only slightly lower than in Japan.


Mirage of Health in the Era of Biomedicalization: Evaluating Change in the Threshold of Illness, 1972-1996

Jason Schnittker
Social Forces, June 2009, Pages 2155-2182

Pooling National Health Interview Survey 1972-1996 data, this study examines whether the threshold of health is rising, such that individuals are more likely to report poor health based on weaker symptoms. The results suggest that those with some form of disability report poor health more often today than they did in the past. Yet the results also reveal a pattern more complex than a simple rising-threshold story. For one, the results suggest a non-linear trend: the conditional reporting of poor health grew steadily until 1983, as expected, but declined thereafter. The results also point to mechanisms not regularly considered in the current debate. Much of the increase, such as it is, has been due to trends in educational attainment, rather than changes in the organization or practice of medicine. Meanwhile, the post-1983 deceleration and reversal has been due, in large part, to population aging. Implications are discussed with respect to the centrality of education in shaping the meaning of and demand for health, as well as the double-edged nature of contemporary medicalization.


A New Medicare End-Of-Life Benefit For Nursing Home Residents

Haiden Huskamp, David Stevenson, Michael Chernew & Joseph Newhouse
Health Affairs, January/February 2010, Pages 130-135

Many elderly people spend their final days in nursing homes. For them, high-quality end-of-life care is an important component of their overall care. Unfortunately, the Medicare hospice benefit-the primary source of palliative care coverage for Medicare beneficiaries-is a poor fit with the nursing home setting. We recommend creating a separate end-of-life Medicare benefit for nursing home residents based on documented need for services that neither requires physicians to certify a person's prognosis, nor requires beneficiaries to choose it or to agree to forgo curative care. Nursing homes would be paid directly for end-of-life care services and held accountable for their quality.


Patient Cost-Sharing, Hospitalization Offsets, and the Design of Optimal Health Insurance for the Elderly

Amitabh Chandra, Jonathan Gruber & Robin McKnight
American Economic Review, forthcoming

Patient cost-sharing for primary care and prescription drugs is designed to reduce the prevalence of moral hazard in medical utilization. Yet the success of this strategy depends on two factors: the elasticity of demand for those medical goods, and the risk of downstream hospitalizations by reducing access to beneficial health care. Surprisingly, we know little about either of these factors for the elderly, the most intensive consumers of health care in our country. We remedy both of these deficiencies by studying a policy change that raised patient cost-sharing for retired public employees in California. We find that physician office visits and prescription drug utilization are price sensitive, with implied arc-elasticities that are similar to those of the famous RAND Health Insurance Experiment (HIE). However, unlike the HIE, we find substantial "offset" effects in terms of increased hospital utilization in response to the combination of higher copayments for physicians and prescription drugs. These offset effects are concentrated in patients for whom medical care is presumably efficacious: those with a chronic disease. Finally, we find that the savings from increased cost-sharing accrue mostly to the supplemental insurer, while the costs of increased hospitalization accrue mostly to Medicare; thus, there is a fiscal externality associated with cost-sharing increases by supplemental insurers. Our findings suggest that health insurance should be tied to underlying health status, with chronically ill patients facing lower cost-sharing. We also conclude that the externalities to Medicare from supplemental insurance coverage may be more modest than previously suggested due to these offsets.


Cancer Therapy Costs Influence Treatment: A National Survey Of Oncologists

Peter Neumann, Jennifer Palmer, Eric Nadler, ChiHui Fang & Peter Ubel
Health Affairs, January/February 2010, Pages 196-202

A national survey of medical oncologists indicates that rising cancer treatment costs are influencing clinical practice, even as oncologists tend not to communicate with patients about costs. The survey shows that 84 percent of oncologists say that patients' out-of-pocket spending influences treatment recommendations. Only 43 percent always or frequently discuss costs with patients. Among those surveyed, 79 percent favor more comparative effectiveness research; 80 percent support more cost-effectiveness data, although only 42 percent feel well prepared to interpret it. The results suggest that physicians support federally funded comparative effectiveness research but that they wish to retain a central role in making decisions about how and when to use expensive cancer treatments. The results also support educating physicians about cost-effectiveness and how to communicate with patients regarding cost.

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