Chicago’s Model Health-Care Fix

It may not seem obvious from news reports, but health-care costs in the U.S. have been growing remarkably slowly. Among the many forces that have caused the slowdown are efforts such as those by Chicago Mayor Rahm Emanuel to change how health-care dollars are spent — a strategy that other cities and states can learn from.

For the past five years, Chicago has kept its health-care bill for employees and retirees roughly flat, at about $450 million a year. And reflected in this success are reforms that hold much promise for the future.

From Bloomberg View – Articles by Peter R. Orszag

Another Piece of Obamacare That Trump Should Keep

To get a sense of the future of American health care, amidst the post-election uncertainty, watch what happens to the Center for Medicare and Medicaid Innovation. This agency, created as part of the Affordable Care Act, has attracted substantial opposition. A recent proposal to change reimbursement to doctors for administering certain drugs, in particular, has led to calls that it be abolished. But let’s hope the center survives, because it could prove crucial to any new effort to raise the value of health care in the U.S.

From Bloomberg View – Articles by Peter R. Orszag

 

We Already Have Health-Risk Scores. Now Let’s Use Them.

Most Americans know they have a personal credit score, and many know where to find it. Few know they also have a personal health-risk score. If these were better known, and better constructed, health insurance markets in the U.S. would work more smoothly.

Commercial health insurance plans, as well as Medicare, Medicaid and other government programs, generate risk scores every year for most of the people they cover. These scores are estimates of each person’s cost of care, compared with the average costs in a large population. And they play a big role in health insurance; they’re often used, for example, to determine how much more insurers are paid for sicker beneficiaries.

From Bloomberg View – Articles by Peter R. Orszag

Education and Taxes Can’t Reduce Inequality

Very often, proposals to even out income inequality advise one of two things: Expand people’s access to education and/or raise the top tax rates. Yet even a big increase in the share of people with a college degree would have only a minimal effect on earnings inequality, research has shown. And now it turns out that a substantial increase in the top marginal tax rate wouldn’t do any better.

The economists Bill Gale and Melissa Kearney (colleagues of mine at the Brookings Institution) and I recently looked into the tax-rate question and found that even a big increase in the marginal tax rate for top earners would have shockingly little effect on after-tax inequality.

From Bloomberg View – Articles by Peter R. Orszag

Saving Money on Cardiac Care

The federal government’s own actuaries are once again pessimistic that America’s health-care costs will continue their slow growth. Thankfully, their boss, Sylvia Burwell, the secretary of Health and Human Services, is working hard to prove them wrong. On Monday, she took another big step in the right direction.

Medicare costs this year are up only 4 percent, which means that on an inflation-adjusted basis, spending per beneficiary is declining. And that’s been the pattern of the past five years — despite the actuaries’ repeated predictions that cost growth is on the verge of picking up.

From Bloomberg View – Articles by Peter R. Orszag

This Isn’t ‘Big Data.’ It’s Just Bad Data.

With response rates that have declined to under 10 percent, public opinion polls are increasingly unreliable. Perhaps even more concerning, though, is that the same phenomenon is hindering surveys used for official government statistics, including the Current Population Survey, the Survey of Income and Program Participation and the American Community Survey. Those data are used for a wide array of economic statistics — for example, the numbers you read in newspapers on unemployment, health insurance coverage, inflation and poverty.

From Bloomberg View – Articles by Peter R. Orszag

Let Veterans Get Civilian Medical Care

I disagree with pretty much everything Donald Trump has ever said. But in calling for veterans to have more options on their doctors and hospitals, he’s got a point. Imagine, for example, the outrage if military veterans were able to receive subsidized health care at the clinic or hospital of their choosing, but were then forced into a separate system of run-down, inconveniently located facilities. If the next administration rejects proposals to reform the Veterans Health Administration and instead perpetuates the current system, the effect will be the same.

from Bloomberg View – Articles by Peter R. Orszag