Healthcare Reform SummaryWhy the need?1 Rapidly rising costs of healthcare o Technology improves » costs rise » number of uninsured rise Mutually Agreed on Reforms Across Party-Lines2 U.S. must move towards a focus on preventative medicine to prevent individual healthcare costs from snowballing out of control resulting from people waiting until their illnesses become severe before seeking treatment3 Adopting more efficient health information technology in hospitals and insurance companies in order to make more information available4 Making health insurance portable from job-to-job5 Reforming medical malpractice insuranceConservative Reforms1 White House Proposals o Equal tax relief to individuals and employers o Zero tax on HSA spending o Increased buying power for small business health insurance purchases o Medical liability reform to limit costly and frivolous lawsuits o Additional assistance for the low-income with persistently high medical expenses o The promotion of prevention, wellness, and fitness2 McCain o Promote competition throughout the Healthcare system o Reform payment system in Medicare to cover providers for diagnosis, prevention, and care coordination o Fund research in science for care and cure of chronic illnesses o Foster development of less expensive pharmaceuticals o Increase variety and affordability of insurance by eliminating tax-code bias toward employer sponsored healthcare o Individual tax credits to increase incentives for purchasing insuranceLiberal Reform2 Obama o Universal Healthcare will lower costs that the healthcare industry incurs from uncompensated care o New public program for those who don’t qualify for Medicaid or SCHIP, and are uninsured by their employers • would have guaranteed eligibility, coverage of essential medical services including maternity leave • minimal premiums and co-pays • employers would be required to provide insurance or contribute funding to the public plan • Mandated healthcare for children2 Clinton o Offer new coverage options for all those insured and not that would provide quality healthcare insurance for everyone  same health insurance choices from quality private providers as members of Congress receive  achieved by a new ‘Health Choices Menu’ set up by the Federal Employee Health Benefit Program so that no new administration system would have to be created  individuals can opt to keep their current plans, or choose a public plan set up similar to Medicare, which would provide increased healthcare security with low premiums • those opting to keep current plans would also share these benefits since healthcare costs will stop rising when everyone becomes insured3 would remove the hidden taxes within premiums that subsidize the cost of uninsured2 by law, would eliminate insurance companies tendency to discriminate against high risk patients and those with preexisting medical conditions3 mandate fair prices for drug companies and the disclosure of accurate information4 require employers to provide healthcare for employees o make large firms cover all costs o provide tax credits for smaller firms • families with members in the labor force would get tax credits designed to prevent premiums from exceeding a % of family income • increased support for public hospitals and community health centers • bolster Medicare and SCHIP to ensure the most vulnerable receive adequate careRecent Private Sector Healthcare Reform, Legislation, and Discussion1 the private sector is failing: 16% are uncovered2 National Governors Association Reforms: aim is forcing private sector to towards public utility efficiency through: o new and better tax credits for companies that provide healthcare o small businesses will be able to join partnerships and alliances to provide healthcare jointly o loans and financial assistance will be provided to health insurance companies in underserved areas in order to increase the number of insured by bringing decreased costs of care to areas with high numbers of uninsured • Economists’ Take • The markets are not at equilibrium for healthcare because provider have the ability to segment risk, allowing them to increase profits o Solutions  community ratings: take all customers rules; insurance companies must announce policies and be willing to accept any customer regardless of risk level  guarantee policy renewals  mandated benefit rules  selection bias regulationUS Healthcare History Review SheetNeed for Healthcare1 200 years ago anyone could become a doctor and medical needs were not being met2 The Industrial Revolution and advancement in medicine are responsible for organized healthcare systems3 The Industrial Revolution made society more industrialized, urbanized the population and caused many people to work away from home4 In response to the Industrial Revolution many medical innovations were discovered which increased physicians performance and people began transitioning from in home practices to established medical institutions1900s1 1901: The American Medical Association marks the establishment of organized medicine2 Many surgical operations are becoming increasingly common3 Doctors are less inclined to provide free healthcare to all patients4 Railroad companies lead the industry in developing employee medical programs5 America however is behind many European countries who have find insurance of sickness costs a valuable amenity 1910s1 Due to the poor healthcare being offered people found it more beneficial to obtain a sickness insurance over health insurance2 The low demand for health insurance decreased insurance company’s willingness to provide private healthcare because they believed risk calculation and moral hazard would be subject to speculation 3 Due to industrial accidents, union movements and social issues led to the passage of workmen’s compensation laws in 1911 and only 2 states had enacted it by 19204 In 1917 the American College of Surgeons’ established the Hospital Standardization Program which encouraged higher standards and enforced record keeping, cleanliness,and wage requirements5 American Association for Labor Legislation organized a conference on social insurance however many states failed to recognize its value for many reasons regarding physicians pharmaceutical companies and commercial insurance firms1920s1 Reformers continue to emphasize the cost of