PPS waivers: implications for Medicare, Medicaid, and commercial insurers

This paper compares the Medicare prospective payment system (PPS) to four all-payer rate-setting systems that operated under HCFA waiver authority. The study examines the experience of Medicare, Medicaid, and commercial insurers under the two approaches. Data from several American Hospital Association surveys and from Medicaid 2082 report forms are analyzed. The paper concludes that the all-payer waiver programs have been as successful as PPS in controlling the rate of growth in Medicare costs. In addition, Medicaid programs are more successful in controlling their outlays in all-payer rate-setting environments than when they "go alone." Finally, there is no evidence to suggest that hospitals can increase charges in response to greater financial need under either PPS or the state waivers. Nevertheless, it appears that commercial insurers are better able to compete with Blue Cross plans in all-payer rate-setting states than elsewhere.     

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.     

Facing the powers that be

Lobbyists, entrenched forces in congress and self-interested friends will try to stymie Clinton's efforts. A look at four key arenas of combat.