Free Market Medicare? Competitive Bidding for Durable Medical Equipment

Government spending on wasteful projects is legendary.  There is the Bridge to Nowhere, Star Wars, and many more.  In Medicare, the government also has a reputation of overpaying for durable medical equipment.  For instance, critics claim that Medicare is both paying too high a price for motorized wheelchairs and buying wheelchairs for people who do not…

How to drop the individual mandate and avoid the collapse of the private health insurance market

Today, the Supreme Court is deciding  whether to let many of the provisions of the Affordable Care Act (a.k.a. ACA, a.k.a. Health Reform, a.k.a. Obamacare) stand.  One of the key provisions is the individual mandate.  The individual mandate requires all individuals to purchase health insurance.  If you don’t buy health insurance, you must pay a…

The Impacts of Managed Competition in Netherlands

Financial incentives matter.  If one had to give economists (and health economists as well) a slogan, this would be it. In 2006, the Netherlands instituted a form of managed competition. According to Van Dijk et al (2012) “Before 2006, inhabitants had either compulsory social (sickness fund, 62%) or voluntarily private (36%) health insurance depending, among others, on income (below a gross…

The Origins of Medicare and Medicaid

Medicare is a widely popular program.  Most American support increasing taxes rather than making cuts to Medicare spending.  Americans prioritize spending on only Social Security and education more than Medicare.  Then there is the famous “Keep Your Goddamn Government Hands Off My Medicare!” statement. Medicaid is Medicare’s ugly step-sister.  Whereas Medicare beneficiaries qualify primarily due…

The Start of Rationing in Medicare?

Prior authorization is a common tool that managed care organizations use to reduce patient utilization of medical services.  Some physicians believe that prior authorization creates barriers to effective care, but other commentators believe that prior authorizations can be implemented in a more efficient manner.  Either way, prior authorizations are a form of rationing care. Although…