A road map for universal coverage: finding a pass through the financial mountains

Government already pays for more than half of U.S. health care costs, and nearly all universal health insurance proposals assume continued government involvement through tax subsidies and other means. The question of what specific taxes could be used to finance universal coverage is, however, seldom carefully examined, in part due to efforts by health care reform proponents to downplay tax issues. In this article we undertake such an examination. We argue that the challenges of relying on taxes for universal coverage are even greater than is generally appreciated, but that they can nevertheless be met. A proposal to fund a universal health insurance voucher system with a value-added tax illustrates issues that would arise for tax-financed plans in general and provides a broad framework for a bipartisan approach to universal coverage. We discuss significant problems that such an approach would face and suggest solutions. We outline a long-term political and legislative strategy for enacting universal coverage that draws upon precedents set by comparable legislative initiatives, including tax reform and Medicare. The results are an improved understanding of the relationship between systemic health care finance reform and taxation and a politically realistic plan for universal coverage that employs undisguised taxes.     

Expanding health insurance coverage: who will pay?

Recent discussions on extending health insurance to the more than thirty million uninsured Americans have focused on two strategies: expanding the Medicaid program and mandating that employers sponsor coverage for their employees. This analysis, using a microsimulation model of the U.S. health care financing system, suggests that these two options would result in very different distributions of financial burden. Employer-sponsored coverage is financed in a highly regressive fashion, in contrast to the Medicaid program, which is proportional to income. Furthermore, the burden of paying for health care under Medicaid varies little among generations, whereas the cost of employer-sponsored care is lowest in households headed by persons over sixty-five years old. Low health status populations do not pay disproportionately higher taxes or premiums to finance either the Medicaid program or employer-sponsored coverage. Their incomes, however, are more effectively protected by Medicaid, because it offers more comprehensive benefits.     

Health care financing among the elderly: who really pays the bills?

This paper investigates the issue of who pays the health care bills of the elderly by considering the types of subsidized health insurance protection enjoyed by the noninstitutionalized elderly and the way that increased Medicare cost-sharing efforts in the 1980s are affecting those without additional health insurance subsidies. In making this examination we estimate the out-of-pocket health care expenditures of the elderly either directly or as nonsubsidized medigap premiums by income level, taking into account four types of health insurance subsidies received by elderly persons: Medicare, Medicaid, Veterans Administration health care, and subsidized health insurance from either current or former employers. We find that increased cost sharing is likely to fall most heavily on those elderly least likely to afford it: the poor and near-poor elderly who have only Medicare as a health insurance subsidy, particularly those who are older and sicker and who use Medicare services more heavily. These persons are caught between well-intentioned federal cost-cutting efforts and the often confusing panoply of health insurance programs for the aged, and they will bear an inequitably large portion of any future Medicare cost-sharing initiatives.     

Health care of the disadvantaged: the elderly

This paper explores threats to the maintenance and expansion of public commitment to financing health care for the elderly. Threats come from rising costs that increase financial burdens, especially on low-income elderly; efforts to contain costs that may undermine benefits; and financing initiatives that treat the elderly as the sole revenue source for addressing problems in that age group. A review of these threats provides lessons not only for sustaining and improving health care for the elderly, but also for policy toward equally or more disadvantaged groups.     

Medicaid program; limitations on provider-related donations and health care-related taxes; limitations on payments to disproportionate share hospitals--HCFA. Final rule

This final rule clarifies HCFA's policies concerning provider related donations and health care related taxes. In addition, this final rule revises regulations with regard to disproportionate share hospital spending limitations. This final rule amends an interim final rule that was published in the Federal Register on November 24, 1992. The interim final rule established in Medicaid regulations limitations on Federal financial participation (FFP) in State medical assistance expenditures when States receive funds from provider-related donations and revenues generated by certain health care-related taxes. The interim final rule also added provisions that establish limits on the aggregate amount of payments a State may make to disproportionate share hospitals for which FFP is available. The provisions of the interim final rule were required by the Medicaid Voluntary Contribution and Provider Specific Tax Amendments of 1991.     

Principles of state health reform: many states not willing to wait for federal reform

Despite the simplicity of the basic objectives of health care reform-- greater access at manageable cost, these goals have not yet been achieved at either the federal or state level. One explanation may be that the American people are not willing to make the sacrifices that are probably necessary to achieve universal access to health care: increased taxes or redirection of governmental expenditures, limitation of choice in providers, and perhaps some form of rationing (which in fact already exists, by limiting access of the uninsured and some of the poor). What, then, are the prospects for meaningful national health care reform in the near future? While the answer to this question remains unclear, there is no doubt that providers across the country are likely to face an unprecedented array of state health care initiatives over the next few years, whether or not federal legislation is enacted. To prepare for this upcoming legislative activity, providers must remain aware of state legislative activity as it evolves.     

Distributive justice and willingness to pay for municipality child care

With the aim of investigating factors affecting willingness to pay for municipality child care, a survey was undertaken in Sweden of 1840 parents living in five municipalities of different sizes. On the basis of the greed-efficiency-fairness hypothesis (Wilke, 1991) which is supported by results from experimental social dilemma research, it was hypothesized that perceived fairness of how the quality of child care is distributed (equal, proportional to need, or proportional to payment) as well as of method of payment (collectively by taxes or proportional to use by fees) would be important determinants of willingness to pay. Results showed that perceived fairness of how quality of child care is distributed played some role but that other factors had stronger effects. Perhaps also reflecting fairness considerations, willingness to pay by fees was on average higher than willingness to pay by taxes. Predicted from previous research, willingness to pay by taxes was furthermore found to increase with income and degree of use. However, willingness to pay by taxes showed an increase rather than the predicted decrease with municipality size.     

Nursing home utilization patterns: implications for policy

Nursing homes represent the fastest growing component of health care expenditures, over half of which come from public funds. This paper reviews research on nursing home utilization with regard to several policy issues concerning the subsidization of long-term care by Medicaid. As a background, the paper defines and contrasts three concepts; need, demand, and utilization. It then indicates how Medicaid policies regarding reimbursement of homes and eligibility for support can result in a chronic shortage of beds and describes the estimated effects on utilization of eight variables: Medicaid generosity, age structure, family resources, racial composition, residence, financial capability of the elderly, price of nursing home care and alternative sources of care. The paper concludes that there is a need for: subsidization of a more comprehensive set of long-term care services, a review of reimbursement policies, and improved methods of allocating existing nursing home beds among persons desiring care.     

National health policy: Efficiency-equity synchretism

A new emphasis in national health policy to encourage efficiency has been born in an environment of slower economic growth and an aging population. The increased reliance on market incentives to reduce health care costs does not signal the abandonment of equity as a social objective. To the contrary, the new emphasis on efficiency is intended to provide more and better health care through the generation of savings from the use of management systems to improve productivity. Market incentives and new management systems to increase efficiency are not the antithesis of equity but tools to provide better health care to the poor and to the elderly in an environment of fiscal constraints.     

瑞典医疗保障制度对我国的启示和借鉴

瑞典完善的医疗保障制度是高福利国家的缩影。瑞典医疗保障具有医疗保障高福利性、公平性和适宜性三个特点。瑞典高福利下的医疗保障也面临高税收、老龄化、低效率、医疗福利诈骗等挑战。我国应从瑞典医疗保险制度中得到启示,坚持全民医保的目标,医疗保障水平的提高应选择循序渐进的路径。     

Medicare revisited: a look through the past to the future

This paper examines the elderly's out-of-pocket health care expenditures by category of expense, before and after the inception of Medicare. It describes the shifting of out-of-pocket expenses from hospital care to nursing-home care, while physician services and drugs have remained prominent components of out-of-pocket expenditures. Recent corrosive trends in the protection against out-of-pocket liability are discussed and analyzed. The author contends that the raging debate over the Medicare program must include and recognize the concerns of the elderly consumer.     

The WTO, Science, and the Environment: Moving Towards Consistency

Governments are increasingly using taxes to address a varietyof environmental concerns. World Trade Organization (WTO) rulesrecognize that, like regulatory instruments, governments mayuse taxes for protectionist purposes. The rules are designedto prevent protectionist behaviour while allowing use of suchinstruments for genuine purposes such as environmental protection.Interestingly, however, there are some notable anomalies inthe rules arising from differential evidentiary requirementsin different situations. First, the rules are different dependingupon whether a country's measure aims to protect on one handhuman, animal, or plant health; or on the other, the environment.Second, the rules are stricter where a country's measure takesthe form of a regulation than where it takes the form of a tax.The article argues that there is no principled rationale forthe differential evidentiary requirements by instrument (regulationversus taxes) or area (health versus environment) but findsthat there may be both a historical and political economy explanation.It also discusses the desirability for consistency in WTO lawacross instruments and risk-related policy areas.     

An Application of Rating Conjoint Analysis to Study the Importance of Quality-, Access- and Price-attributes to Health Care Consumers

Outside the health care sector, consumer preferences have been effectively studied using rating and ranking conjoint techniques. In the health care sector this technique has received less attention than its choice-based variant. Applications of rating and ranking method to health care issues are few. This paper presents an application of rating conjoint analysis to study the importance of quality, access and price to the health care consumers in Bulgaria. The paper first describes the rating conjoint method and its distinctive features compared to the choice-based and the ranking approach. The method is illustrated by the rating conjoint design applied in the study. Next, the impact of different quality-, access- and price-levels on the rating of physician profiles is analysed and the differences between the socio-demographic groups are examined. The results suggest that similar to other countries, the quality of care is a highly valued characteristic in Bulgaria, whereas access is perceived as less important. The considerable importance of patient payments further implies that Bulgarians are responsive to prices in the health care sector, especially the elderly, the village dwellers and the lowest income groups. The relevance of the results with regards to health policy and planning, as well as with regards to the methodology of rating conjoint analysis is discussed at the end of the paper.     

HMO enrollment of Medicare recipients: an analysis of incentives and barriers

Although there has been increased interest in use of the health maintenance organization (HMO) model to resolve a variety of problems relating to provision of health care to older individuals, less than 2 percent of Medicare beneficiaries are currently enrolled in HMOs. This paper examines both legislative and operational barriers to HMO enrollment of the elderly. Legislative reforms, HMO organizational structures, and marketing strategies thought to encourage enrollment of the elderly are discussed.     

Medicare's fiscal problems: an imperative for reform

Many observers have noted that Medicare expenditures will significantly outstrip projected revenues over the course of the next 25 years. This paper examines the economic and demographic assumptions behind forecasts of Medicare hospital insurance and supplementary medical insurance expenditures and revenues and analyzes various strategies for closing the impending gap. It is argued that the present forecasts already assume considerable success in controlling hospital costs and physician payments, making substantial further savings unlikely. Shifting more of the burden onto the elderly through increased cost sharing or higher premiums also will not solve the program's fiscal problems over the long term. The remaining alternative--imposing higher income or payroll taxes on the under-65 population--is also unlikely to be a welcome solution. The authors argue that, eventually, the nation must choose between some form of a two-tier system of benefits or a Canadian-style national health insurance system.     

Space-age medicine, stone-age government: how Medicare reimbursement of telemedicine services is depriving the elderly of quality medical treatment

We have the technology. What is needed is government financial commitment, so argues Kristen Jakobsen in the following discussion of "telemedicine." The term refers to the delivery of health care services by means of modern telecommunications technology. According to Ms. Jakobsen, the telephone, the fax machine, the Internet, and interactive audio-visual transmissions hold the key to making medical care more accessible and less expensive. Potential beneficiaries include vast populations of elderly in rural areas, who tend to be remote from upscale health care facilities and in need of the wherewithal to reach them. Standing in the way, in Ms. Jakobsen's view, is a government which lacks the boldness and the vision to lay an adequate fiscal foundation for this promising possibility.     

Gas taxes and motor vehicle fatalities

Economists view taxes as a more efficient means of reducing the consumption of a product than regulation. They have therefore suggested raising cigarette and alcohol taxes to reduce the undesirable effects of tobacco and alcohol on the public's health. This essay suggests that a gasoline tax can have similar beneficial influences on reducing highway deaths and injuries. Moreover, if some proceeds of the tax are used to finance mass transit, the regressivity of the tax can be ameliorated.     

Managed competition versus industrial purchasing of health care among the Fortune 500

The theory of managed competition has found favor with many health policy analysts and academic economists alike. Three characteristics--consumer choice, defined contribution, and dissemination of information--signal managed competition strategy. By requiring private employers to provide their employees with a choice of health carriers, a fixed-dollar strategy (defined contribution), and quality information to make appropriate choices among carriers, managed competition offers to remedy imperfections in both the consumer and provider sides of the market for health insurance. In an extensive survey of health care purchasing practices among Fortune 500 companies we found that major companies are not using the managed competition approach to health care purchasing. Instead, most of the companies surveyed are purchasing health care in the same way as they do other inputs to production--a pattern we call industrial purchasing.     

Obstacles to dependent health care access in Oregon: health insurance or health care?

In the 1980s, Oregon was one of a handful of "states that could not wait" for national health care reform. Oregon's chosen approach to reform was predicated on two widely accepted assumptions. First, universal access to health care is best achieved by universal access to health insurance. Second, universal access to health care could best be achieved, at least politically, by incrementally building upon the existing health care delivery and insurance system. This article questions both of these assumptions in light of Oregon's decade-long experience in trying to expand access to health care among its dependent population.     

Technology assessment and the sociopolitics of health technologies

In a growing number of countries, health technology assessment (HTA) has come to be seen as a vital component in policy making. Even though the assessment of the social, political, and ethical aspects of health technology is listed as one of its main objectives, in practice, the integration of such dimensions into HTA remains limited. Recent social scientific research on the inherently political nature of technology strongly supports such a comprehensive approach. The growing claims by and on behalf of consumer groups also suggest that HTA should be informed by a broader set of perspectives. Using the example of the cochlear implant in children, this essay compares the professed objectives of HTA with typical practice and explores possible explanations for the discrepancies observed. A second example, home telemonitoring for elderly persons, demonstrates how the types of evidence considered by HTA and the process through which assessments are produced may be reconsidered. We argue for the formal integration of the sociopolitical dimensions of health care technologies into assessments. The ability of HTA to more fully address important issues from a public policy point of view will increase by making explicit the sociopolitical nature of health care technologies.