Tax subsidies for health insurance: costs and benefits

The continued rise in the uninsured population has lead to considerable interest in tax-based policies to raise the level of insurance coverage. Using a detailed microsimulation model for evaluating these policies, we find that while tax subsidies could significantly increase insurance coverage, even very generous tax policies could not cover more than a sizable minority of the uninsured population. For example, a generous refundable credit that costs $13 billion per year would reduce the ranks of the uninsured by only four million persons. We also find that the efficiency of tax policies, in terms of the cost per newly insured, inevitably would fall as more of the uninsured were covered.     

Adolescent sexual behavior and attitudes: A costs and benefits approach

PurposeThe majority of past research conceptualized adolescent sexual attitudes as a single factor that included both Costs and Benefits of sexual behavior. The current study examined the independent influences of attitudes concerning the costs, such as embarrassment and pregnancy, and benefits, such as physical pleasure, of sexual intercourse on reports of actual engagement in sexual intercourse controlling for age, gender, religion, and cognitive ability.MethodsThis study utilized data from the National Longitudinal Study of Adolescent Health (Add Health). Participants were 14,871 adolescents aged 15 and older who completed the Wave I In-Home Interview. Hierarchical regression was used to examine the relation between Costs and Benefits and the variables of age, gender, religion, and cognitive ability. Logistic regression was used to predict engagement in sexual intercourse at Wave I and Wave II from measures of costs, benefits, age, gender, religion, and cognitive ability.ResultsThe measure of Costs and Benefits demonstrated good psychometric properties. Both Costs and Benefits were significantly associated with concurrent and future sexual activity after controlling for demographic variables (age, religion, gender, cognitive ability). In addition, both Costs and Benefits also predicted sexual initiation between Waves I and II.ConclusionsThe current study demonstrated the importance of both Costs and Benefits in predicting later sexual activity. Although attitudes concerning costs were slightly more influential in predicting sexual activity, our results suggest that interventions designed to delay sexual activity should include components of both Costs and Benefits.     

Switching benefits and costs in competitive health insurance markets: A conceptual framework and empirical evidence from the Netherlands

Competitive health insurance markets will only enhance cost-containment, efficiency, quality, and consumer responsiveness if all consumers feel free to easily switch insurer. Consumers will switch insurer if their perceived switching benefits outweigh their perceived switching costs. We developed a conceptual framework with potential switching benefits and costs in competitive health insurance markets. Moreover, we used a questionnaire among Dutch consumers (1091 respondents) to empirically examine the relevance of the different switching benefits and costs in consumers’ decision to (not) switch insurer. Price, insurers’ service quality, insurers’ contracted provider network, the benefits of supplementary insurance, and welcome gifts are potential switching benefits. Transaction costs, learning costs, ‘benefit loss’ costs, uncertainty costs, the costs of (not) switching provider, and sunk costs are potential switching costs. In 2013 most Dutch consumers switched insurer because of (1) price and (2) benefits of supplementary insurance. Nearly half of the non-switchers – and particularly unhealthy consumers – mentioned one of the switching costs as their main reason for not switching. Because unhealthy consumers feel not free to easily switch insurer, insurers have reduced incentives to invest in high-quality care for them. Therefore, policymakers should develop strategies to increase consumer choice.     

Clinical performance improvement: measuring costs and benefits

Market shifts in health care reimbursement have made the improvement of clinical performance a key strategic goal for health care delivery systems, including hospitals, physician groups, and integrated delivery systems. This process requires a clinical management infrastructure, advanced clinical information technology, engaged physicians, and alterations to the strategic plan for the delivery system. Because the change to a clinical efficiency orientation takes several years for organizations to achieve, adoption of this approach must begin before markets become fully mature for managed care and most practicing physicians are aware of the change. This article outlines how to evaluate the costs and benefits of improving clinical performance and how to determine when an organization should begin making this change. It advises delivery systems executives to raise the priority of clinical performance improvement and to measure both the near-term and long-term impact of this approach on revenue, cost, quality, and market share.     

Increasing health insurance costs and the decline in insurance coverage

OBJECTIVE: To determine the impact of rising health insurance premiums on coverage rates. DATA SOURCES & STUDY SETTING: Our analysis is based on two cohorts of nonelderly Americans residing in 64 large metropolitan statistical areas (MSAs) surveyed in the Current Population Survey in 1989-1991 and 1998-2000. Measures of premiums are based on data from the Health Insurance Association of America and the Kaiser Family Foundation/Health Research and Educational Trust Survey of Employer-Sponsored Health Benefits. STUDY DESIGN: Probit regression and instrumental variable techniques are used to estimate the association between rising local health insurance costs and the falling propensity for individuals to have any health insurance coverage, controlling for a rich array of economic, demographic, and policy covariates. PRINCIPAL FINDINGS: More than half of the decline in coverage rates experienced over the 1990s is attributable to the increase in health insurance premiums (2.0 percentage points of the 3.1 percentage point decline). Medicaid expansions led to a 1 percentage point increase in coverage. Changes in economic and demographic factors had little net effect. The number of people uninsured could increase by 1.9-6.3 million in the decade ending 2010 if real, per capita medical costs increase at a rate of 1-3 percentage points, holding all else constant. CONCLUSIONS: Initiatives aimed at reducing the number of uninsured must confront the growing pressure on coverage rates generated by rising costs.     

Screening for mild hypertension: costs and benefits.

It is important to understand the full implications of introducing a new screening and treatment programme into the National Health Service. In this paper, we calculate, for mild hypertension, the cost of community-based screening and the cost of case-finding in general practice. We show that case-finding in general practice is both less expensive and more efficient. We calculate the cost of running a programme in general practice for five years and divide that cost by an estimate of the number of deaths that might be prevented as a result of introducing such a programme. This calculation give a minimum cost for extending a life by the programme.     

Medical costs in workers' compensation insurance: comment

Professors Baker and Krueger ignore some costs associated with workers' compensation. Because of these costs, the contention that physicians willfully exploit the workers' compensation system for their own gain is questioned.     

Clinical ROI: not just costs versus benefits

Although sophisticated economic modeling can be used to quantify intangible benefits, ROI calculations for clinical information systems are driven more by the values and strategic direction of an organization than by any other considerations. But investing in clinical information tools to ensure quality and patient safety is, in reality, required as a cost of doing business and functioning as a safe hospital.     

Occupational accidents: social insurance costs and work days lost

OBJECTIVE: To estimate the proportion of occupational accident benefits granted within the total for health-related social security benefits, viewing the costs according to benefit type and the impact on productivity according to work days lost. METHODS: Records of benefit decisions from the National Benefits System of the National Social Security Institute for the State of Bahia in 2000 were utilized. Occupational accidents were defined in accordance with the clinical diagnoses of External Causes, Injuries and Poisoning (SS-00 to T99) of the International Classification of Diseases, 10th Revision, and with the benefit type, which distinguishes between occupational and non-occupational health problems. RESULTS: A total of 31,096 benefits granted due to illnesses or health problems were studied. Of these, 2,857 (7.3%) were caused by work accidents. Greater proportions were found among workers in the manufacturing, construction, electricity and gas industries, accounting for 18% of the total benefits. The costs of occupational accident benefits were estimated to be R$8.5 million, with around half a million work days lost during the year studied. CONCLUSIONS: Despite the fact that these data are under-reported and are restricted to workers who were able to receive health-related benefits, the findings reveal that avoidable health problems have a major impact on productivity and on the budget of the National Social Security Institute, thereby reinforcing the need for their prevention.     

Public and private health insurance: stacking up the costs

Some proposals to expand health insurance coverage for people with low incomes are based on expansions of public programs, such as Medicaid or the State Children's Health Insurance Program (SCHIP), while others rely on the use of tax subsidies for individuals to purchase private insurance. Analyses of data from the 2005 Medical Expenditure Panel Survey indicate that total medical spending is much lower when coverage is provided by Medicaid or SCHIP than it is when coverage is provided by private insurance. Public insurance is particularly advantageous from the consumer's perspective because associated out-of-pocket spending is far lower.     

Corporate benefit policies and health insurance costs

We tested the hypothesis that health insurance premium costs per employee are lower for employee groups where multiple health plans are offered and the employer pays a level dollar amount of the chosen premium than for employee groups where these two conditions are not met. Proposed national legislation relies on these conditions to create a competitive health care market. Data on 56 employee groups in 1981 and 66 employee groups in 1982 were collected from two surveys of large employers in Minnesota. Regression analysis of premium data from both surveys rejected the hypothesis. Indemnity plans in multiplan groups were cheaper if the employer paid a level dollar contribution versus a level percent (including 100) contribution. However, groups offered only an indemnity plan had lower premiums than groups meeting the two legislative conditions. These findings apply to both individual and family coverage premiums and are not caused by systematic differences in benefit provisions, employee demographics or factors influencing loading charges. Our findings cast doubt on attempts to achieve health care competition by legislative changes in insurance options and contribution methods.     

Peripheral outpatient clinics: use, costs, and benefits

A census was taken of outpatient bookings at all hospitals and health centres in Oxfordshire for the main medical and surgical specialities. Nine per cent of all bookings were to peripheral clinics (that is, those outsie the two main medical centres at Oxford and Banbury). About half of all bookings in the area were made to clinics within three of four miles of the patients' homes. The work load at peripheral clinics was mainly local: 75% of all patients at these clinics lived in the town or parishes adjacent to the town where the clinic was held. Peripheral clinics were associated with a lower work load at central clinics, but a higher overall work load from the town in which they were sited.     

Employers' benefits from workers' health insurance

Even though many employers believe that health insurance and health affect employees' productivity and firms' performance, health economists typically overlook and rarely measure firms' returns on health-related investments. Some research, however, suggests that firms may benefit economically by providing health insurance coverage for workers and their families. For example, health coverage may help employers recruit and retain high-quality workers. Health may contribute to productivity by reducing the costs of absenteeism and turnover and by increasing workers' productivity. This article reviews the evidence and proposes an agenda for future research. A better understanding of the benefits to employers of offering health coverage to workers may help clarify employers' behavior and help private employers and public officials make appropriate investments in health.