State Medicaid reform under Section 1115 demonstration authority

Given the complexity of federal Medicaid law and the limitations it imposes on state flexibility, it is likely that states will continue to ask the Secretary to grant waivers under Section 1115 to allow them to pursue new approaches to health care reform. The results of currently operational Section 1115 projects involving statewide managed care systems will be useful in evaluating the Medicaid reform measures currently under discussion in other states and at the federal level. In particular, the ability of the states to control Medicaid and indigent care costs and to utilize federal dollars more efficiently should prove important in evaluating a block grant approach to federal Medicaid funding. Moreover, Section 1115 project results that bear on the sufficiency of various Medicaid capitation rate methodologies will also be of value as more states expand the use of managed care arrangements for their Medicaid populations.     

State Medicaid managed care enrollment: understanding the political calculus that drives Medicaid managed care reforms

The objective of this article is to understand the political motivations underlying Medicaid managed care reforms by examining the determinants of enrollment of beneficiaries in managed care plans in the fifty states. To highlight the role of the model variables, including measures of the political environment, public interest, and special interests, a distinction is made between capitated and fee-for-service managed care enrollment. The results show that cost containment within the context of the Medicaid program is perceived as strongly favored by voters. Accordingly, the relative cost and tax price of providing Medicaid services are important factors in states' decision to enroll Medicaid beneficiaries in managed care plans, particularly capitated ones. The results also indicate a surprisingly significant influence by labor unions that generally oppose managed care enrollment for fears of lost jobs. The recipient population and provider groups also play an important role in shaping the Medicaid managed care landscape. The influence of variables measuring states' ability and willingness to pay and median voter preferences suggest that, within the context of Medicaid managed care enrollment, the public's interests are being served; however, the results also point toward inequities within the program and implications concerning financing arrangements between states and the federal government.     

Leading the health policy orchestra: the need for an intergovernmental partnership

The past decade provides a useful window through which to examine whether states are likely to provide health care leadership. During this era, states were given increased discretion to set health care policy, they had the financial resources to encourage innovation, and their administrative capacity was at its strongest ever. Despite the favorable conditions, however, states were reluctant to spend their own funds on programs for the uninsured, their efforts to make private insurance more affordable for the small business community were disappointing, and their efforts to regulate the managed care industry fell short. At the same time, though, the most promising innovations over the past decade were in programs financed primarily with federal dollars, administered primarily by state officials, and advanced by an intergovernmental partnership in which administrators at different levels of government prod each other to try and do more. This sort of intergovernmental partnership provides the best model for innovative health policy leadership.     

Medical liability and health care reform

We examine the impact of the Affordable Care Act (ACA) on medical liability and the controversy over whether federal medical reform including a damages cap could make a useful contribution to health care reform. By providing guaranteed access to health care insurance at community rates, the ACA could reduce the problem of under-compensation resulting from damages caps. However, it may also exacerbate the problem of under-claiming in the malpractice system, thereby reducing incentives to invest in loss prevention activities. Shifting losses from liability insurers to health insurers could further undermine the already weak deterrent effect of the medical liability system. Republicans in Congress and physician groups both pushed for the adoption of a federal damages cap as part of health care reform. Physician support for damages caps could be explained by concerns about the insurance cycle and the consequent instability of the market. Our own study presented here suggests that there is greater insurance market stability in states with caps on non-economic damages. Republicans in Congress argued that the enactment of damages caps would reduce aggregate health care costs. The Congressional Budget Office included savings from reduced health care utilization in its estimates of cost savings that would result from the enactment of a federal damages cap. But notwithstanding recent opinions offered by the CBO, it is not clear that caps will significantly reduce health care costs or that any savings will be passed on to consumers. The ACA included funding for state level demonstration projects for promising reforms such as offer and disclosure and health courts, but at this time the benefits of these reforms are also uncertain. There is a need for further studies on these issues.     

Coexistence, conflict, and cooperation: public policies toward medical devices

Medical devices include thousands of products, many of which have greatly contributed to the quality of health care. As devices have proliferated, so have public policies that affect them. The federal government intervened to promote three fundamental values: safety by federal regulation, innovation through federal funding of research and development, and access by providing services under Medicare. The policies generally coexisted without conflict. However, two recent developments--the advent of cost containment and the expansion of the tort liability system--present a potentially disruptive influence on these policies, and threaten to undermine the values they serve. Because cost restraints are inevitable and the tort system provides consumer protection, the challenge for policymakers is to reconcile them with the values of safety, innovation, and access. The proposals presented here seek to promote coordination to protect those values without imposing unacceptable costs on the health care system.     

The political management of managed care: explaining variations in state health maintenance organization regulations

In the 1990s, strong incentives for managed care organizations to control costs, once regarded as a fortuitous confluence of interests, came to be seen as antithetical to consumers' interests in quality of care. In response to this change in political climate, many states have greatly increased their regulatory control of managed care organizations since the mid-1990s. This activity is surprising in an era when public policy on health care issues is usually described as frozen, gridlocked, and/or stalemated as a result of intense activity on the part of organized interests. We take advantage of the variation in state regulations of health maintenance organizations (HMOs) to discover why some governments are able to address policy problems that are often perceived as intractable in a political if not in a true policy sense. From the history of HMOs, the backlash against managed care, and state responses to that backlash, we first extract a number of hypotheses about state regulatory activity. We then test these hypotheses with data on regulatory adoptions by states during the late 1990s and the early 2000s. Last, we discuss the findings with special attention to the role of politics in health care.     

The evolution of an innovation: variations in medicaid managed care program extensiveness

This article utilizes a theoretical framework of policy innovation, diffusion, and reinvention to investigate the evolving nature of Medicaid managed care programs over time. By estimating two separate models, one for primary care case management (PCCM) and a second for risk-based program enrollment, this study seeks to disentangle two different paths of learning (internal and external), investigate the potential effects of vertical diffusion of policy, and examine the impact of internal state characteristics on the extent of Medicaid managed care. With respect to diffusion and learning, the data reveal that earlier adopters implement more extensive programs. The data fail to reveal much internal learning, although there is evidence of some. External impacts are clear: managed care enrollments in neighboring states and changes in the federal waiver process affect states' decisions. Other policy choices are important: states with more generous Medicaid eligibility rules implement more extensive managed care programs. Complementing other studies of Medicaid, we find that politics and economics make a difference for the extent of managed care programs; unlike other Medicaid studies, we find no effect of race and ethnicity.     

Waiting for Godot: wishes and worries in managed care

Managed care has done a better job at reducing expenditure growth than it has in improving quality. Although reduced expenditure growth is not appreciated by many, it has real benefits. For the majority of Americans who are privately insured, it results in greater disposable income for goods and services other than health care (although the illusion of employer-paid health insurance obscures this reality for many). For Medicaid programs, slower growth of expenditures facilitates efforts at expanding coverage. For low-income workers, slower expenditure growth results in larger numbers of people retaining insurance coverage than would have been the case if premiums rose more quickly. While there are some victories to which managed care organizations can point, we cannot credibly argue that overall levels of quality and health outcomes are improving as the health care system is massively disrupted by changes in health care finance and delivery. The disruptions create real hardships for some physicians and other health care workers, and worries for many consumers. These worries fuel the managed care backlash. The danger is that politicians will respond to these worries with policies that inhibit the development of high-quality delivery systems. The opportunity is for relatively modest public policy changes--external review organizations, better public-sector purchasing capabilities, public investment in producing and publicizing information on health plan and medical group performance, and establishment of a public ombudsperson--to respond to consumer worries and lead to improvements in health care quality and outcomes. Finally, I would be remiss without a reminder that the single most effective action politicians could take to improve health care quality and outcomes would be to change the rules of health care financing to assure that all Americans are covered by managed care. Even with all of its inadequacies, managed care is much superior to the patchwork care available to the 43 million Americans who are uninsured. The managed care backlash is concerned with protecting patients who are insured (and their providers). Far more valuable would be to protect those without insurance. Sadly, no politician has yet figured out how to do this. Still waiting.     

Three meanings of capacity; or,why the federal government is most likely to lead on insurance access issues

This essay considers on what health policy issues the federal government is best able to lead. Positive leadership requires knowledge, power, and will. The federal government has different supplies of each for different aspects of quality of, cost of, and access to health care. Here I review technical capacity to attain desired ends, define the institutional strengths and weaknesses of the federal government, and outline current dynamics of the national political process. This analysis suggests both prospects for and some characteristics of successful policy. The federal government is more likely to lead on insurance than on other health policy issues because its supply of relevant knowledge and power is relatively high on insurance issues and the political barriers are lower than conventional wisdom suggests. But that leadership could take the form of either the expanding or contracting of access to insurance.     

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.     

Legislative responses to managed care pressures

Changes brought about by the increasing presence of managed care have sparked responses in a number of states. While proponents of managed care contend that it fosters competition and allows the market to influence its nature and functioning, the legislators' responses call into question the notion that managed care will bring greater freedom to insurers and providers and, at the same time, will benefit health care consumers.     

Ethical issues in managed care: can the traditional physician-patient relationship be preserved in the era of managed care or should it be replaced by a group ethic?

Over the last decade managed care has become the dominant form of health care delivery, because it has reduced the cost of health care; however, it has also created serious conflicts of interest for physicians and has threatened the integrity of the traditional physician-patient relationship. In this Article, Dr. Grochowski argues that the efficiencies created by managed care are one time savings and will not in the long run reduce the rate of rise of health care expenditures without a concomitant plan to ration health care. He explores the traditional physician-patient relationship and concludes: a) that while rationing of health care is inevitable, physicians must not ration care at the bedside; b) that physicians must be advocates for their patients; c) that physicians must avoid conflicts of interest whenever possible; d) that physicians must put the needs of the patient before their own self-interests; and e) that physicians must act in ways to promote trust in their relationship with patients.     

美国管理式医疗的发展历程及对国内医保的借鉴

从理论和实证的研究表明,管理式医疗曾被当作美国医疗保险改革的典范,甚至有人尊其为有效降低医疗费用和成本的灵丹妙药。在有效控制节节攀升的医疗服务费用方面,管理式医疗确实达到了非常好的效果。但是,医疗服务需要关注的不仅是费用,还有医疗服务的质量、服务的可及性以及临床医疗的长远发展等方面。而美国管理式医疗的发展历程生动地诠释了普通民众需要的不仅仅是"廉价"的医疗服务这一现实。     

Considerations in Medicare reform: the impact of Medicare preemption on state laws

This article explores the key issues involved in understanding the impact of Medicare preemption on state laws affecting the federal purchase of managed care products, as a consideration in future Medicare reform. Author Commander Jackonis argues that any further Medicare reform must address the impact of federal preemption on quality and quantity of care purchased in order to ensure the existence of a market of product providers, as well as to ensure protection of patient rights and benefits.     

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.     

Policing Medicaid and Medicare managed care: the role of courts and administrative agencies

The much-publicized 2000 case of Frew v. Gilbert, in which a federal judge castigated the State of Texas for deficiencies in its Medicaid program, brought renewed attention to the issue of regulating the quality of care in Medicaid and Medicare HMOs. Frew and other recent cases highlight both the promise and the pitfalls of relying on courts to correct deficiencies in public managed care programs. This article argues that while litigation over inadequacies in Medicare and Medicaid managed care can serve an important signaling function in alerting agencies and legislatures about the need for reform, the role of the courts in policing public managed care is circumscribed by several constraints. Barriers to class action litigation and differences in the institutional capacities of courts and administrative agencies mean that litigation is best viewed as a supplement, not an alternative, to a renewed commitment to strong quality monitoring on the part of Centers for Medicare and Medicaid Services and state Medicaid agencies.     

Beyond "safe and effective": the role of the federal government in supporting and disseminating comparative-effectiveness research

Over the past century, medical advancements have resulted in tremendous health gains for Americans. Although the federal government has played a prominent role in ensuring that new treatments are safe and effective, questions about which medical treatments work best under which circumstances have largely remained unanswered. Thus, the federal government's recent major investments in comparative-effectiveness research have potential to play a significant role in helping both patients and health care providers navigate the vast array of available treatment options, as well as in improving the quality, efficiency, and delivery of health care system-wide. Yet, the controversial nature of the government's foray into comparative-effectiveness research also suggests that the path toward realizing these goals may be treacherous. This Article describes the rationales for federal support of comparative-effectiveness research and potential models for that involvement, analyzes the federal government's recent investments in the research, and concludes with predictions about the probable outcomes of these investments. While increased federal support for comparative-effectiveness research is unlikely to achieve all of the benefits anticipated by its supporters, it is a crucial step toward ensuring that Americans are able to take full advantage of the benefits of medical innovation     

Special report on health care delivery systems. Trends in the integrated delivery of health care and the corporate practice of medicine

The prospects for federal legislation preempting state corporate practice restrictions are unclear. The health care reform bill originally introduced by President Clinton contained a provision that would have preempted "any state law related to the corporate practice of medicine" insofar as it applied to the arrangements between non-fee-for-service health plans and their participating providers. H.R. 3600/S. 1757, 103d Cong., 1st Sess. 1407(b) (1993). Whether and in what form a preemption provision may survive the legislative process and see a Presidential signature remains to be seen. The particular fate of the federal legislation notwithstanding, however, health care executives can nevertheless remain confident that the legal treatment of the "corporate practice" of medicine will continue to be of vital concern as the various forms of health care organizations evolve in the ongoing struggle to deliver quality medicine at affordable prices.     

Preferred providers and the credible commitment problem in health insurance: first experiences with the implementation of managed competition in the Dutch health care system

We investigate the impact of the transition towards managed competition in the Dutch health care system on health insurers' contracting behaviour. Specifically, we examine whether insurers have been able to take up their role as prudent buyers of care and examine consumers' attitudes towards insurers' new role. Health insurers' contracting behaviour is investigated by an extensive analysis of available information on purchasing practices by health insurers and by interviews with directors of health care purchasing of the four major health insurers, accounting for 90% of the market. Consumer attitudes towards insurers' new role are investigated by surveys among a representative sample of enrollees over the period 2005-2009. During the first four years of the reform, health insurers were very reluctant to engage in selective contracting and preferred to use 'soft' positive incentives to encourage preferred provider choice rather than engaging in restrictive managed care activities. Consumer attitudes towards channelling vary considerably by type of provider but generally became more negative in the first two years after the reform. Insurers' reluctance to use selective contracting can be at least partly explained by the presence of a credible-commitment problem. Consumers do not trust that insurers with restrictive networks are committed to provide good quality care. The credible-commitment problem seems to be particularly relevant to the Netherlands, since Dutch enrollees are not used to restrictions on provider choice. Since consumers are quite sensitive to differences in provider quality, more reliable information about provider quality is required to reduce the credible-commitment problem.     

The Impact of Insanity Acquittees on Missouri's Public Mental Health System

Even though state departments of mental health have primary responsibility for the care, custody, and treatment of insanity acquittees, the impact of insanity acquittees on the public mental health system is generally lacking in policy discussions and as a topic for policy research. This issue has received increased attention in Missouri, where insanity acquittees now occupy half of the long-term public psychiatric hospital beds. This article examines the presence of Missouri's insanity acquittees on the state's public mental health system and includes the impact on goals, fiscal costs, inpatient and community psychiatric services, and inpatient treatment staff. As states consider managed care and other cost containment measures, it remains to be seen if the high costs associated with extensive use of hospitalization of insanity acquittees to promote public safety will influence policy changes to more community-based insanity acquittee systems.