State health reform: Effects on labor markets and economic activity

Individual states are actively weighing health care reform proposals and their potential impacts on many levels, including states' own economies. This article considers the effects on state economies of two instruments of health reform: employer mandates and cost containment. The literature suggests that an employer mandate will reduce employees' wages in the long run. In the short run, however, to compensate for the costs associated with mandated health care insurance for their employees, firms may raise their prices to consumers, reduce the number of employees or allow a drop in profit margins. By increasing health care spending and the number of insured persons, mandates would also increase states' levels of economic activity. Though cost containment may dampen the stimulative effects of expanded coverage, resources not spent on health care as a result of effective cost containment might be redistributed to other sectors in a state's economy.     

Assessing Medicaid managed care in eastern state.

This case examines the expanding role of managed care programs in improving health care for the poor while controlling runaway health care costs. The case asks what the commissioner of health in a large eastern state should do to effectively monitor Medicaid managed care programs in her state. The commissioner faces intense pressures for cost containment and strong, but not universal, support for the managed care solution to health care cost problems. The commissioner is herself concerned that the cost savings attributed to managed care may not be real and that the unintended effects on health care may be adverse. Her immediate challenge is to determine what kinds of data she should require service providers to submit to her agency so that she may effectively monitor managed care programs for health care quality, provide positive feedback to health care providers, and establish politically credible program oversight.     

Assessing medicaid managed care in eastern state

This case examined the expanding role of so-called managed care programs in improving health care for the poor while controlling runaway health care costs. The case asked what the commissioner of health, Dr. Lorna Hill, in a large eastern state should do to effectively monitor Medicaid managed care programs in her state. The commissioner faced intense pressures for cost containment and strong, but not universal, support for the managed care solution to health care cost problems. The commissioner was herself concerned that the cost savings attributed to managed care might not be real and the unintended effects on health care might be adverse. Her immediate challenge was to determine what kinds of data she should require service providers to submit to her agency so that she could effectively monitor managed care programs for health care quality, provide positive feedback to health care providers, and establish politically credible program oversight.     

THE HEALTH CARE MARKETPLACE; PERSPECTIVES ON A SYSTEM IN TRANSITION

Within the last 35 years health care expenditures have increased from $12 billion t o over $350 billion. Recent concern over these costs have led to a reevaluation of the health care delivery system in the United States. This paper reviews four emerging cost containment models. The discussion focuses on the "market-likell incentives introduced in to the health care delivery system by such strategies.     

Health Care Reform in Britain and Germany: Recasting the Political Bargain with the Medical Profession

Health care systems in the postwar period have been governed by political bargains between the state and the medical profession that have delinzated their respective powers and jurisdictions. Recent health care cost containment reforms in Britain and Germany are altering these bargains, and thereby challenge the prerogatives and autonomy of the medical profession in health policy formulation and in administration of the health care systems. But these challenges to doctors' power and autonomy vary between the two countries. Britain's 1989 “internal market” reforms attack the corporatist bargain with physicians by introducing market mechanisms into the National Health Service and, at the same time, strengthening central state control of the health care system. In Germany, on the other hand, the government's 1992 reforms only partially breached the corporatist bargain with doctors in order to strengthen rather than destroy this governance arrangement. The government has tried to curb what it views as excessive power of doctors while still allowing them a significant degree of corporatist self-governance. The reform efforts in both countries highlight some of the problems with different governance arrangements in health care systems and, more specifically, the difficulties associated with a market in health care.     

The Medicaid Mandates of the 1980s: An Intergovernmental Perspective

Medicaid, the health care program for the poor, has undergone significant changes in the last fifteen years. Many of those changes relate to the intergovernmental nature of the program. Medicaid is jointly operated, with the federal and state governments sharing program costs. Despite a set of program guidelines dictated by the federal government, states have traditionally had substantial latitude in Medicaid decisions. However, a series of developments in the 1980s led to increasing constraints on state Medicaid discretion, including federal mandates to expand Medicaid coverage. This article examines the inception and effectiveness of the Medicaid mandates from the perspective of interstate equity of health care services for poor families.     

Cost Containment in a Public-Private Health Care System: The Case of Italy

Health care cost containment has become an important issue in Western countries in recent years. However, most efforts have met with only limited success and Italy is no exception. This article examines the mixed public-private system existing in Italy. It also describes and evaluates cost-containment efforts in the Italian public health care system.     

Money and Mandates: The Politics of Intergovernmental Conflict

The federal government's relationship with the states dependsin part on the level of federal aid and the number of federalmandates. Environmental policy, with less federal aid and moremandates, differs from education policy and health policy. Thevolume of intergovernmental litigation is heavier and rhetoricalreferences to intergovernmental partnerships by agency headsare more common in environmental policy. Waivers are more commonin education policy and health policy, but that appears to bea function of congressional policies largely barring environmentalpolicy waivers. Federal judges are more supportive of the federalgovernment's position on environmental protection and educationthan its position on health care. Overall, federal funding andmandates appear to have an impact on state governments, federalbureaucrats, and federal judges.     

HEALTH CARE RATIONING AND COST CONTAINMENT ARE NOT SYNONYMOUS

Much public discussion about health care assumes, explicitly or implicitly, that only by denial of potentially beneficial care (called "rationing") can cost containment be achieved. This piece critically examines the various current usages of "rationing," and argues that it is being misapplied. Fur- ther, the call for rationing may be deflecting us from fruitful exploration of non-rationing alternatives to cost control. Two of these are briefly sketched as examples: physician fee controls and practice guidelines.     

A policy analysis of hospital waiting lists.

The Canadian system of publicly provided health care has been praised for its cost containment attributes. Conventional cost measures do not identify costs associated with rationing access to medical facilities. This paper explores the economic relevance of hospital waiting lists and offers estimates of the economic costs of waiting for different hospital procedures in Canada. The estimated costs are relatively low as a share of overall economic activity but appear quite comparable to losses associated with labour strikes and lockouts.     

Ideas and inducements in mental health policy.

Between 1946 and 1963, federal officials sought to change the national practice of providing mental health care, away from state-run mental institutions and toward outpatient care based in local communities. These policy makers relied on two policy instruments, ideas and inducements. Both instruments contributed to unexpectedly significant changes in federal, state, and local policy. I conclude that a policy instrument framework helps to disentangle the strands of successful public management, and that it is useful to think of ideas as policy instruments that offer leverage on policy outcomes.     

Federalism and suitable housing for the frail elderly: A comparison of policies in Canada and the United States

Abstract

The frail elderly have special multidimensional housing needs beyond affordability, including shelter that is more adaptive to reduced function and offers supportive services. Suitable housing for this population comprises three policy areas—housing, health care, and social services. In a federal system, development and implementation of policies in these areas involves participation of several levels of government and the nongovernmental sector. This paper uses federalism as a conceptual framework to examine and compare these policy areas in Canada and the United States.

In both countries, general national housing policies—relying heavily on the nongovernmental sector and characterized by joint federal‐provincial programs in Canada and by important local government roles and age‐specific programs in the United States‐have benefited the elderly. The effects of such policies on the frail elderly, however, have been less positive because of the general lack of essential human services and, to a lesser degree, health care that enables them to live outside institutions. This is especially true in the United States, where health care policy is fragmented and is dominated by a private insurance system, partial federal financing of health insurance for the elderly, and tense federal‐state relations in financing health care for the poor. Although Canadian policies and programs operate autonomously and more uniformly within a national health plan, neither country has a universal, comprehensive long‐term care system. Geographically diverse patterns of social services, funded by grants to states and provinces and the nonprofit sector, are common to both countries. However, the United States has inadequately funded age‐specific programs and has relied on a growing commercial service provision. Housing outcomes for frail elders are moving in the right direction in both countries; however, Canada seems to be better positioned, largely because of its health care system. As increased decentralization continues to characterize the three policy areas that affect suitable housing for frail elders, the United States can learn from Canada's negotiated federalism approach to more uniform solutions to merging housing and long‐term care.     

THE AFFORDABLE CARE ACT'S EFFECTS ON PATIENTS,PROVIDERS, AND THE ECONOMY: WHAT WE'VE LEARNED SO FAR

As we approach the tenth anniversary of the passage of the Affordable Care Act, it is important to reflect on what has been learned about the impacts of this major reform. In this paper, we review the literature on the impacts of the ACA on patients, providers, and the economy. We find strong evidence that the ACA's provisions have increased insurance coverage. There is also a clearly positive effect on access to and consumption of health care, with suggestive but more limited evidence on improved health outcomes. There is no evidence of significant reductions in provider access, changes in labor supply, or increased budgetary pressures on state governments, and the law's total federal cost through 2018 has been less than predicted. We conclude by describing key policy implications and future areas for research.     

State Tax Credits and "Making Work Pay" in Post-Welfare Reform Era

This article outlines the work incentives and income support provided by the federal Earned Income Tax Credit (EITC) and illustrates how state earned income and dependent care credits assist working poor families. State earned income and dependent care tax credits serve as critical complements to the EITC, the federal government's largest antipoverty program. By attending to specific components of each tax credit, state policymakers can maximize state funds that qualify for federal maintenance of effort requirements under the Personal Responsibility and Work Opportunity Reconciliation Act (PROWRA), and they can reinforce positive effects and offset work disincentives stemming from current federal tax parameters.     

The State of American Federalism, 1997 - 1998

Although it was a relatively quiet year for the courts and congressionalaction, 1997–1998 saw several developments that may significantlydefine federalism in the coming years. The 1998 federal budgetis projected to show a surplus, ending decades of deficit financinginWashington, D.C., but also raising questions about the budget'sfiscal impact on federalism and intergovernmental relations.Devolution took a back seat in Washington, D.C., as concernsabout managed care, education, and internet access led to proposalsfor increased federal involvement in state and local affairs.The states continued their implementation of welfare reformand launched other programs in health, environment.     

Learning from the States? Federalism and National Health Policy

In its 1993 report, the Winter Commission gave direction to the federal government in the area of health policy and Medicaid: lead, follow, or get out of the way. This article examines how the federal government responded to that advice, specifically asking what has happened in the allocation of responsibility in health policies between 1993 and 2006. In short, unlike the suggestion that there be a better‐defined direction in federal–state policy assignments in health, the ensuing years have resulted in more of the same. The authors examine what has happened, particularly focusing on vertical diffusion—where the states have acted first—and on the role of policy learning in federal decision making. They find little recognition of policy learning in recent federal health laws—even in areas in which state experience was extensive. The federal government is leading in some health policies—but it is leading without learning.     

Policy convergence and divergence in Belgium: Education and health care

Due to the far-reaching devolution of policy competences, Belgium allows for a structured comparison of policy convergence or divergence between Flanders and Wallonia. Focusing on the link between the federal state and the development of policy-making in the regions, this article establishes far-reaching policy divergence between the Flemish and French Communities for education policy, and a beginning of divergence in health care. Radical changes in Flemish education policy have redefined the role of the state. In health care, divergence grows in terms of regulating access to the medical professions and defining the output of medical care. The explanation for this policy divergence lies in political factors more than in policy-related features. Political entrepreneurs play a determining role in seizing upon opportunities to trigger and support change.     

Medicaid in the 1990s: Trends, Innovations, and the Future of the "PAC-Man" of State Budgets

Rapidly escalating health-care inflation and congressionallymandated expansions have led to large increases in spendingfor Medicaid, the federal-state program of health care for thepoor. These increases came at a time when state budgets werealready under recession-induced stresses. In addition, 1991brought new pressures for Medicaid spending from the courtsand closer federal scrutiny and control over revenues used forthe program's state "match." Yet the Medicaid picture is farfrom bleak. Diversity, innovation, and an emerging stale policyrole also characterize the program in ways that epitomize thestrengths and weaknesses of the American intergovernmental system.     

Vertical Competition in the Spanish National Health System (NHS)

In unitary states, competitive decentralisation structures can take place by increasing the visibility of politically accountable jurisdictions in certain policy responsibilities such as health care. Drawing from the Spanish decentralisation process we examine the mechanisms (and determinants) of vertical competition in the development of health policies in the Spanish National Health System. The Spanish example provides qualitative evidence of vertical competition that assimilates government outcomes of unitary states to that of federal structures. The Spanish experience indicates that the specific vertical competition mechanisms in place until 2002 are likely to be responsible for significant policy innovation and welfare state development.     

Informal caregiving as state Medicaid expenditure: an only slightly immodest proposal

States and Medicaid recipients would be better off if the federal Medicaid program allowed states to assign a dollar value to some unpaid care friends and family give to Medicaid recipients. The dollar value of this unpaid labor would then be counted as state spending in the calculation of federal match. The proposal, which would ease the pressure on tight state budgets, is entirely compatible with the recent federal-state compromise regarding provider taxes and donations and reinforces an important but overlooked Medicaid policy that cultivates and relies upon households to deliver care.