Health Care

Health Care

Research

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.
Christopher Koopman, Thomas Stratmann, Mohamad Elbarasse | May 26, 2015
Thirty-six states and the District of Columbia currently limit entry or expansion of health care facilities through certificate-of-need (CON) programs. These programs prohibit health care providers from entering new markets or making changes to their existing capacity without first gaining the approval of state regulators. Since 1972, Kentucky has been among the states that restrict the supply of health care in this way, with 18 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.
Christopher Koopman, Thomas Stratmann, Mohamad Elbarasse | May 19, 2015
Thirty-six states and the District of Columbia currently limit entry or expansion of health care facilities through certificate-of-need (CON) programs. These programs prohibit health care providers from entering new markets or making changes to their existing capacity without first gaining the approval of state regulators. Since 1972, Michigan has been among the states that restrict the supply of health care in this way, with 18 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.
Adam C. Smith | May 19, 2015
In this paper I explain how the Department of Health and Human Services has taken on a powerful coordinating role in the provision of health care as a result of the Patient Protection and Affordable Care Act. This paper analyzes the unfurling of that act using the Bootlegger–Baptist model of political economy. By tracing the development of the law and its effect on how health care is delivered, the analysis shows that economic interests became coordinated through the efforts of the White House and the central “televangelist” agency, the Department of Health and Human Services. This development will inevitably result in bureaucratic decisions replacing individuals’ choices as the agency takes on an increasingly active and interventionist role in how health care is provided.

Testimony & Comments

Research Summaries & Toolkits

Expert Commentary

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.
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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.
Jun 11, 2015

If I got a dollar each time the federal or state government promised that new regulations of the health care market would reduce the cost of health care — and it subsequently failed to deliver on that promise — I would be a rich woman. The Affordable Care Act is the most recent example of such failed promises, obviously. But certificate of need laws take the cake at the state level.
Jun 09, 2015

For over a century, we've regarded health care as qualitatively different from other goods and services – an economic Oz, where the normal rules of nature don't apply. In doing so, we waste resources, keep prices artificially high and delay life-saving and life-improving technologies. But this will soon pass.
Jun 04, 2015

How can we produce better health for more people at a lower cost, year after year? By lifting all the rules and barriers that prevent health care innovators from bringing new lifesaving products to consumers and force doctors to beg bureaucrats and insurance administrators for permission to save lives.

Charts

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.

Experts

Charles Blahous is the director of the Spending and Budget Initiative, a senior research fellow at the Mercatus Center at George Mason University and 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 for the Mercatus Center at George Mason University.
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.

Podcasts

Robert Graboyes | March 24, 2015
For the 5th anniversary of the passing of the Affordable Care Act, Mercatus Center health policy scholar Robert Graboyes analyzes the impact of this legislation. He argues that partisan fighting over health insurance fails to address the real need in America’s healthcare system: providing lower-cost healthcare for more people sustainably.

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.

Books

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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