July 2009

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The newest Research Associate at Acumen, LLC

July 5, 2009 in Miscellaneous | 2 comments

Tomorrow, I begin my first day of work at Acumen, LLC.  Founded by Stanford Economist Thomas MaCurdy, Acumen specializes in program evaluation for Medicare and Medicaid.  Here are some more details from the Acumen website:

Acumen, LLC was established by scholars from Stanford University in 1996 to improve the information provided to policymakers who design and revise welfare, health, education, labor, and business programs at the national, state, and local levels. In conjunction with its affiliated nonprofit firm, the SPHERE Institute, Acumen offers practitioners a powerful policy analysis capability, providing specific, impartial advice and context for policy debates. 

We are committed to the improvement of public policy through information management, and we have worked with several agencies to develop resources to build their internal databases and self-evaluation capacity. To supplement internal sources of information, our team has created and utilized all forms of administrative and survey data to produce outcomes relevant for both service providers and funding organizations. 

Acumen members have experience conveying information and research findings to broad audiences of policymakers, program operators, and other stakeholders. With these interrelated goals and expertise, Acumen, LLC serves the interests of the public, government, business and the research community.

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Wal-mart wants universal health care…why?

July 4, 2009 in Health Insurance | 3 comments

Some people believe Wal-mart supports universal healthcare because:

  1. Wal-Mart wants to change its image, 
  2. Wal-Mart wants to make its voice heard in the process, or 
  3. Wal-Mart is flummoxed by unpredictable health care costs.

Megan McArdle believes that there is only one reason Wal-mart wants universal health care: profits.  If all employers are mandated to provide health insurance, Walmart will have a significant health insurance economies of scale compared to its smaller rivals.

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To Test or Not to Test…

July 3, 2009 in Supply of Medical Services | 1 comment

Tests play an important role in modern medical care.  Is my leg broken?  Check the X-ray.  Do I have HIV?  Look at the blood tests.

But when are tests appropriate?  In some cases, tests will not alter treatment.  For instance, let assume that a person is either healthy or has Disease X.  Disease X is untreatable or does not require treatment.  This illness could represent a life-threatening disease for which there is no treatment, or it could also represent a minor ailment which would heal on its own.  Since we know that if a patient has Disease X it won’t be treated, should insurance cover the cost of the test?

In our example, the value of information to providers is $0.  If the physician finds out the patient does not have Disease X, they will not treat them.  If they do have Disease X, they will still not treat them since because this particular type of disease.  From the clinical point of view, the test is worthless.

However, if Disease X was a life threatening disease, most patients would want to know their prognosis.  In the absence of health insurance, individuals who wanted to find out if they had Disease X could pay for the test out of pocket.  Those who preferred to save their money and deal with extra uncertainty would not have the test done.

The question is, should insurance cover the test for Disease X?  If insurance does decide to cover the test, this will increase insurance premiums.  However, if everyone who potentially would have Disease X would always have the test, this would simply be a transfer of funds from all enrollees to those who potentially had Disease X.  If some individuals would forego the test in the absence of insurance, moral hazard would mean that more of these individuals would have the test done if it were covered by insurance.  

From an insurance company point of view, what is the correct evaluation tool?  As mentioned earlier, the test has no clinical value, but patients likely would value this information highly if Disease X were life-threatening.  Should insurance companies incorporate enrollee willingness-to-pay in their benefit packages or should they rely on a strictly clinical evaluation?  I would lean towards the clinical definition, since it is very difficult to model individual willingness-to-pay.  If the test is so valuable, the patients can pay for it themselves.

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Canadian Mental Health Care

July 1, 2009 in Uncategorized | 4 comments

In this blog, I have frequently discussed the merits of Canadian and American health care systems (see Health Care Grudge Match).  One thing most people can agree with is that mental health care is subpar in both countries.  

The Vancouver Sun reports of a man committing suicide by jumping off the Granville Street Bridge.  
[In British Columbia]…family members of persons with severe mental health problems complain about the difficulty of getting loved ones committed. They cite restrictive confidentiality rules that isolate the family member in need, or the difficulty of getting doctors to agree to a commital or the system’s unwillingness to commit a patient until it is too late.

“In the 20-month period from December, 2006 through to Mr. Kwapiszewski’s suicide in 2008, Ms. Haboosheh — either directly or through her husband, Mr. Kwapiszewski’s GP, a lawyer, and a North Shore mental health worker — contacted Vancouver mental health services 16 times, desperately trying to get them to intervene as her brother showed more and more troubling behavioural symptoms. Three letters were also filed as part of, or in conjunction with, those contacts, and some meetings were also involved. Ms. Haboosheh also called the Vancouver Police Department on three different occasions to report him missing. Of the 16 calls and other contacts, 10 were with Mental Health Emergency Services and six with the Midtown Mental Health Team. They consistently, however, declined to commit Mr. Kwapiszewski for treatment, insisting he was non-committable. There was no mistaking his deterioration, however.”

There are fewer quantitative tests associated with mental health evaluations.  Also, there is also more of a stigma associated with mental compared to physician illness.  For both of these reasons, mental health problems too frequently take a back seat to physical health illnesses.

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