Health Care

Health Care


Roger Feldman, Bryan Dowd, Robert Coulam | Oct 08, 2015
A new study published by the Mercatus Center at George Mason University assesses the numerous problems with Medicare’s price calculations and looks at how they affect prices in commercial insurance policies. The study proposes an arrangement of competitive bidding on bundles of services as a promising alternative to Medicare’s price-fixing regime.
David E. Bernstein | Sep 30, 2015
A new study published by the Mercatus Center at George Mason University describes how such an approach in Medicare Part B—which covers outpatient services such as office visits and preventive care—could enhance doctors’ participation in the program, expand choices for beneficiaries, boost innovation, and make prices more responsive to market forces. Below is a brief summary of this analysis. Please see “Restoring Freedom of Contract between Doctor and Patient in Medicare Part B” to read the entire study and to learn more about its author, David E. Bernstein, the George Mason University Foundation Professor at George Mason University School of Law.
Diana Thomas, Devon Gorry | Aug 17, 2015
A new study for the Mercatus Center at George Mason University finds that regulations intended to improve the quality of child care often focus on easily observable measures, such as group sizes or child–staff ratios, that do not necessarily affect the quality of care but do increase the cost of care. These regulations can have unintended consequences, including increasing the cost of child care while decreasing the wages of child care workers. Eliminating regulatory standards that do not affect the quality of care while focusing on those that do, such as teacher training, will improve the quality of child care while making it more affordable to low-income families.
James Bailey, Douglas Webber | Jun 17, 2015
By 2010, the average US state had passed 37 health insurance benefit mandates (laws requiring health insurance plans to cover certain additional services). Previous work has shown that these mandates likely increase health insurance premiums, which in turn could make it more costly for firms to compensate employees. Using 1996–2010 data from the Quarterly Census of Employment and Wages and a novel instrumental variables strategy, we show that there is limited evidence that mandates reduce employment. However, we find that mandates lead to a distortion in firm size, benefiting larger firms that are able to self-insure and thus exempt themselves from these state-level health insurance regulations. This distortion in firm size away from small businesses may lead to substantial decreases in productivity and economic growth.
Christopher Koopman, Thomas Stratmann, Mohamad Elbarasse | Jun 02, 2015
Since 1977, West Virginia has been among the states that restrict the supply of health care in this way, with 21 devices and services—including acute hospital beds, magnetic resonance imaging (MRI) and positron emission tomography (PET) scanners—requiring a certificate of need from the state before the device may be purchased or the service offered.
Casey B. Mulligan | May 28, 2015
According to the model presented in this paper, the ACA’s incentives and ultimately its behavioral effects will vary substantially across groups, with the elderly experiencing hardly any new incentives and female workers being most likely to cut their work schedules to 29 hours per week.

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Expert Commentary

Oct 08, 2015

Traditional "fee-for-service" (FFS) Medicare — which pays providers a fee for each service delivered — is the nation's largest health-insurance program, enrolling 38.1 million aged and disabled beneficiaries in 2014. The program pays more than 200 million claims for inpatient hospital admissions and home-health-care visits each year, and 1 billion claims for doctors' services. There are about 10,000 different services for doctors alone, and each of these fees is set through an administrative process that attempts to discern the cost of producing that service — called the "relative value" — in terms of the costs of physician work, practice expenses, and liability insurance.
Oct 05, 2015

The Affordable Care Act’s “Cadillac plan tax” has been much in the news of late. A motley collection of health sector companies, conservative ACA opponents, labor unions and presidential candidates is working for repeal. On the other side101 health policy experts recently wrote to urge Congress to retain the tax “unless it enacts an alternative tax change that would more effectively curtail (health care) cost growth.” This piece will explain the basics of the Cadillac plan tax, some of the policy and political reasons for its enactment, and why its current precarious status was both predictable and predicted.
Jul 23, 2015

Some recent regulatory milestones have been crossed. First, we've reached the five-year anniversary of Dodd-Frank. I recently published some charts showing that Dodd-Frank may be the biggest law ever, if the size is measured by how much new regulatory text it spawns. No one disputes this fact: Dodd-Frank created a massive surge in regulations, and it did so in a relatively short time span.
Jun 25, 2015

The ACA is a massive law, written and passed in haste. Such procedural shortcuts yield unintended consequences and pose unanticipated risks to the American people. The real lesson of King v. Burwell is that transformative legislation should never be written or passed in extreme haste, nor imposed by a single party. Ignoring those principles assures that the Affordable Care Act will remain bitterly contentious and subject to additional litigation for years to come.
Jun 22, 2015

We have yet another report showing the ACA's finances turning out worse than previous projections and, properly understood, also showing that repeal--whatever its other policy virtues or drawbacks--would improve the fiscal outlook.
Jun 17, 2015

Not all state health mandates are bad policy, but each comes with a tradeoff that state legislatures must carefully consider. The benefits of certain mandates, such as those involving prenatal care, may easily outweigh the costs to society. However, a requirement that health-insurance plans cover acupuncture may not pass this cost/benefit threshold. The costs may come at the expense of the traditional driver of the American economy, small businesses.


The existence of a CON program is detrimental to the welfare of the residents of the state, regardless of the number of restrictions. Even for states with only a few restrictions, Stratmann and Russ find that the presence of a CON program in a state is associated with fewer hospital beds, Computed Tomography (CT) scanners, and MRI machines.


Charles Blahous is the director of the Spending and Budget Initiative, a senior research fellow at the Mercatus Center at George Mason University and has served as a public trustee for Social Security and Medicare. He specializes in domestic economic policy and retirement security (with an emphasis on Social Security), as well as federal fiscal policy, entitlements, demographic change, and health-care reform.
Robert Graboyes is a senior research fellow and healthcare scholar with the Mercatus Center at George Mason University and is the author of the study “Fortress and Frontier in American Health Care.” He earned his PhD in economics from Columbia University. An award-winning teacher, Graboyes holds teaching positions at Virginia Commonwealth University and the University of Virginia.
Christopher J. Conover is an affiliated senior scholar at the Mercatus Center at George Mason University and a research scholar at the Center for Health Policy & Inequalities Research at Duke University.
Jerry Ellig is a senior research fellow at the Mercatus Center at George Mason University and a former assistant professor of economics at George Mason University. He specializes in the federal regulatory process, economic regulation, and telecommunications regulation.
Michael L. Marlow is an affiliated senior scholar at the Mercatus Center at George Mason University and professor of economics and distinguished scholar at California Polytechnic State University, San Luis Obispo.


Robert Graboyes | September 10, 2015
Dr. Robert Graboyes discusses the future of health care and how regulating historic models can impede innovative, game changing health solutions.

Recent Events

Please join us for lunch with Mercatus Center Senior Research Fellow Jason Fichtner to discuss pro-growth policy options. He’ll also address the research and ideas Mercatus shares with policymakers in order to advance the debate on economic issues.


| Sep 29, 2015
In a new set of essays commissioned by the Mercatus Center at George Mason University, seven leading policy experts share innovative ideas on how to solve the pre-existing condition challenge. While their approaches exhibit differences as well as similarities, they are unified in their pursuit of a humane, equitable, fiscally sustainable solution to a conundrum that has driven and strained the entire post–World War II healthcare debate.

Media Clippings

Casey B. Mulligan | Oct 09, 2014
This excerpt originally appeared in The Washington Times.
Robert Graboyes | Sep 25, 2014
This excerpt originally appeared in Reuters.
Charles Blahous | Jun 04, 2014
This excerpt originally appeared in CQ and also appeared Roll Call.
Robert Graboyes | Jan 29, 2014
Robert Graboyes cited at Star-Telegram.
Tyler Cowen | Oct 30, 2013
Tyler Cowen cited at The Washington Post.
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