Unbiased Analysis of Today's Healthcare Issues

Will value-based pricing be coming to the U.S.?

The answer may be yes.  One of the big inpediments to value-based pricing of pharmaceuticals was that any discount given to any single organization based on outcomes needed to be reflected in the Medicaid price.  Since outcomes are subject to random noise, there will inevitably be health plans that end up getting a low price due to worse than expected […]

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Medicaid Managed Care and Drug Utilization for Patients with Serious Mental Illness

How will Medicaid expansions affect patient access to pharamceuticals? This question is particularly relevant for patients with serious mental illness. The answer is complicated by the increasing presence of Medicaid managed care plans. Increasingly, states have turned to contracts with Medicaid managed care plans in order to better control costs and reduce budgetary uncertainty. However, in […]

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P4P in Medicaid

Does Medicaid use pay-for-performance (P4P) for providers?  If so, how does it work?  And does it affect quality and cost? These are the questions of interest to Rosenthal et al. (2015) in their study of P4P programs in Alabama, Minnesota, and Pennsylvania.  Although all three focus on physicians, the Alabama program is a “medical home ” […]

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Who pays for the elderly’s medical care in the U.S.?

In the U.S., the answer is largely the government.  An NBER paper by Mariacristina De Nardi, Eric French, John Bailey Jones, and Jeremy McCauley provide some helpful statistics using data from 1996 to 2010 waves of the Medicare Current Beneficiary Survey (MCBS). The government pays for two-thirds of health care spending by the elderly, with Medicare […]

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Physician shortage?

A physician shortage may be a bit much, but it appears that physicians overestimate their availability based on a study by Coffman et al. (2016). The percentage of callers posing as Medicaid patients who could schedule new patient appointments was 18 percentage points lower than the percentage of physicians who self-reported on the survey that […]

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2016 ASSA: How does expanding Medicaid eligibility affect take-up and health care spending?

Typically, answering this question is difficult as the Medicaid program varies across states and even within states. What Amanda Kowalski and co-authors do in a paper she presented at the 2016 ASSA is collect data on the variation in Medicaid eligibility across states, across demographic groups, and across time from the inception of Medicaid in […]

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Over half of federal spending on entitlements

Here’s a graphic from the NIHCM foundation summarizing where federal revenues come in an where they are spent.  As you can see about one quarter of the budget is spent on  Medicare, Medicaid, CHIP and ACA Subsidies and another quarter is spent on Social Security.  This is not news if you have been reading the Healthcare Economist diligently […]

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“Best price”

What price does Medicaid pay for drugs? The answer is, the “best price”.  What is “best price?” The 1990 Omnibus Reconciliation Act (OBRA) codified that pharmaceutical manufacturers must give Medicaid steep discounts in order to receive coverage by state Medicaid agency.  How big are the discounts?  The answer is the larger of a fixed percentage of the […]

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Does increased use of prescription drugs lower medical costs?

There is a belief that providing better care can reduce cost, at least somewhat.  For instance, some claim that better primary care can avoid unnecessary hospitalizations.  But can increased use of prescription drugs lead to decreased medical spending?  This is exactly what a paper by Roebuck et al. (2015) find.  They write: We found that a 1 […]

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Medicaid Expansions and Crowd Out

Most previous research into Medicaid expansions focus on extending coverage to pregnant women or children. However, a recent Section 1115 waiver allows for researcher to examine what happens when Medicaid coverage is extended to a larger share of adults. This is exactly what a paper by Atherly et al. (2015) examines: …prior to ACA adults […]

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