Special report on health care reform. ERISA preemption, Traveler's and health care reform

Although S. 308 reportedly has some bipartisan support, its passage is by no means certain. ERISA has for years provided employers with the freedom to design their own benefit plans without state interference, as well as the ability to operate such plans in a uniform manner throughout the country. large employers are thus not likely to cede the advantages of ERISA preemption without a battle. When strong business interests are pitted against the states' equally strong interests in enacting health care reforms, the outcome cannot be predicted.     

Real reform begins within: an organizational approach to health care reform

Health care systems are under pressure to control their increasing costs, to better adapt to evolving demands, to improve the quality and safety of care, and ultimately to ameliorate the health of their populations. This article looks at a battery of organizational options aimed at transforming health care systems and argues that more attention must be paid to reforming the delivery mechanisms that are so crucial for health care systems' overall performance. To support improvement, policies can rely on organizational assets in two ways. First, reforms can promote the creation of new organizational forms; second, they can employ organizational levers (e.g., capacity development, team-based organizations, evidence-informed practices) to achieve specific policy goals. In both cases organizational assets are mobilized with a view to creating complete health care organizations -- that is to say, organizations that have the capacity to function as high-performing systems. The challenges confronting the development of more complete health care organizations are significant. Real health care system reforms may likewise require implementing ecologies of complex innovation at the clinical, organizational, and policy levels. Policies play a determining role in shaping these new spaces for action so that day-to-day practices may change.     

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.     

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.     

ERISA, agency costs, and the future of health care in the United States

Because so many Americans receive health insurance through their employers, the Employee Retirement Income Security Act (ERISA) of 1974 plays a dominant role in the delivery of health care in the United States. The ERISA system enables employers and insurers to save money by providing inadequate health care to employees, thereby creating incentives for these agents to act contrary to the interests of their principals. Such agency costs play a significant role in the current health care crisis and require attention when considering reform. We evaluate the two major health care reform movements by exploring the extent to which each reduces agency costs. We find that agency cost analysis clarifies the benefits, limits, and uncertainties of each approach.     

The new institutionalist approaches to health care reform: lessons from reform experiences in Central Europe

This article discusses the applicability of the new institutionalism to the politics of health care reform in postcommunist Central Europe. The transition to a market economy and democracy after the fall of communism has apparently strengthened the institutional approaches. The differences in performance of transition economies have been critical to the growing understanding of the importance of institutions that foster democracy, provide security of property rights, help enforce contracts, and stimulate entrepreneurship. From a theoretical perspective, however, applying the new institutionalist approaches has been problematic. The transitional health care reform exposes very well some inherent weaknesses of existing analytic frameworks for explaining the nature and mechanisms of institutional change. The postcommunist era in Central Europe has been marked by spectacular and unprecedented radical changes, in which the capitalist system was rebuilt in a short span of time and the institutions of democracy became consolidated. Broad changes to welfare state programs were instituted as well. However, the actual results of the reform processes represent a mix of change and continuity, which is a challenge for the theories of institutional change.