Obamacare

Here is the Skimm's guide to Obamacare.

Transparency pricing in healthcare

This article in the WSJ reports on the advantages of increasing the transparency of prices. Conduct a Google search of the title if the full article does not appear.

SUMMARY: There's a major effort under way to make sure patients know how much they'll pay-before they make treatment decisions. "Princeton economist Uwe Reinhardt likens using the U.S. health-care system to shopping in a department store blindfolded and months later being handed a statement that says, 'Pay this amount.' The price-transparency movement aims to lift that veil of secrecy and empower patients and other payers to be smarter health-care consumers.... Experts expect consumers to be much more price-sensitive as they shoulder a growing proportion of health costs themselves."

CLASSROOM APPLICATION: Instructors can present two points about the incentives of patients to consider price when choosing health-care providers: price transparency; and consumers paying at least some of the cost of care.

QUESTIONS:

1. (Introductory) Why is better consumer information about health-care prices important in bringing down the cost of health care?

2. (Introductory) Why is more patient responsibility in paying for the price of a procedure important in bringing down the cost of health care?

3. (Advanced) How would better consumer information about the prices of various health care providers for a particular procedure combined with greater consumer responsibility for the price of the procedure affect the cost health care?

4. (Advanced) How would "reference pricing" affect the quality of care? How would it affect the compensation of health-care providers?

PPACA v. markets

This article in the NYT describes why some professional living in New York will have to pay more under PPACA than they do when left to their own devices and free market exchanges. They have formed associations and purchased health insurance through the associations rather than as individuals. PPACA forces them to enroll as individuals. On the plus side, they will be able to children on their policies longer, face no consequences if they have or develop preexisting conditions, and not worry about how much insurance companies have paid in benefits over their lifetimes.  

The article is a good example of the effects of asymmetric information and a potential solution to it, the ingenuity of individuals and how they respond to incentives, and an unintended consequence of public policy.

PPACA = Patient Protection and Affordability Act, aka ACA and Obamacare

The Kahn Academy has a good summary.

Click here for the summary provided by the White House.

Click here for a thoughtful piece in the WSJ that discusses the fundamental nature of the bill.

This article in CNBC describes some of the reactions by business to Obamacare. The rational actor paradigm predicts all of them: incentives matter.

Visit the posts labelled Health Care for more.

Business responds to PPACA

This article in CNBC describes some of the reactions by business to Obamacare. The rational actor paradigm predicts all of them: incentives matter.

ObamaCare = PPACA

Here is a video that portrays PPACA unfavorably. It is hyperbolic and contains grains of truth. To read the 906-page bill, click here.

Here is another critical and comical portrayal of PPACA.

How do you know when a politician is lying?

Here is a CNN story on a difference between what Obama promised when promoting passage of the ACA and what he said recently. I particularly like the bite where Obama says, "We will keep this promise."  Here is the video released by the Obama folks which they said is a 4-minute summary of the plan. Note the first point.

I am not confident that what he said recently is accurate. My understanding is that individuals will lose plans that do not meet the standards specified in the ACA even if the plans have not changed since the passage of the bill. Here is a story about cancellations.

FYI: When his or her lips are moving.

How Obamacare wrecks the work ethic

Here is an opinion that is critical of the impact on marginal effective tax rates of implementing Obamacare. It mentions the impact on labor market decisions and the possible impact on the macro-economy.

Maine to Allow Prescription-Drug Imports

Here is an article I might use to introduce price discrimination. It is an account of a new law in Maine that allows for the re-importation of drugs produced in the US. It mentions the effect on prices and quality control.

Health Insurers Scramble to Keep Healthy Customers

This article from the WSJ describes how insurers are "informing" their customers as the rollout of the health exchanges approaches.

One money quote is, "In most states, carriers are tailoring their messages based on the age and potential subsidy eligibility of their policyholders. Letters to younger, healthier members play up expected rate increases to discourage them from shopping on the exchanges. But in some cases insurers say they are encouraging older people to look at their options on the exchanges, where they might find lower rates."

Why would insurers discourage younger, healthier members from shopping on the exchanges while encouraging older people to do so?

Who can anticipate lower premiums on average under the ACA than before: young people, healthy people, old people, sick people, people with bare bones coverage before ACA? Which of the groups listed above can anticipate higher premiums?

Click here for a related post.

Will young healthy adults be willing to subsidize old sick adults?

This article from the WSJ points out that a key to the success of the ACA is for young, healthy adults to purchase health insurance, thereby subsidizing older, sicker adults.

From the Mouth of the Horse

This clip is a good summary of Obama's position on the ACA.

What is Health Insurance

This opinion does a nice job describing the difference between catastrophic health insurance and pre-paid medical payments and argues that Sebilious does not understand the difference. The writer does a nice job illustrating the moral hazard associated with pre-paid medical payments. 

400 years of health and standards of living

Click here for a great video showing 400 years of data for health and GDP per capita for 200 countries. It shows the link between health outcomes and GDP, that outcomes improve at different times in different areas and countries, and that war and epidemics can have big effects. It makes a great introduction to talk about economic development and the role of institutions and good government.