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Assessing the access and equity concerns in a Medicare-X-style public option reform
Assessing the access and equity concerns in a Medicare-X-style public option reform
- Collection:
- Health Policy and Services Research
- Series Title(s):
- Urban Institute research report
- Author(s):
- Blavin, Fredric E., author
Blumberg, Linda J., author
Simpson, Michael, (of Urban Institute), author - Contributor(s):
- Health Policy Center (Urban Institute), issuing body.
- Publication:
- Washington, DC : Urban Institute, April 2023
- Language(s):
- English
- Format:
- Text
- Subject(s):
- Ethnic and Racial Minorities -- statistics & numerical data
Health Care Reform -- economics
Health Equity -- economics
Health Policy
Medicare -- economics
United States - Genre(s):
- Technical Report
- Abstract:
- Different stakeholders advocate for the creation of a public option for different reasons. Some are motivated to offer a nonprofit, government-run insurance option, presuming that such an alternative would better protect consumers’ interests than commercial insurers do today. Others primarily value the cost-containment potential a public option might provide, presuming it would pay health care providers (hospitals, physicians, pharmaceutical manufacturers, etc.) on a fee schedule lower than the typical provider payment rates private insurers have negotiated. This cost-containment presumption is based on the fact that the Medicare and Medicaid programs pay providers significantly less than do private insurers, and public sector fees tend to grow slower than private sector fees. However, whenever substantial cost containment initiatives are explored, providers and others raise concerns that lower provider revenue could decrease access to or quality of necessary medical services. Exploring these concerns and estimating the potential implications of lower payments on access and quality is a responsible, necessary step in designing cost-containment strategies. This is particularly true when contemplating the implications of cost-containment approaches for populations that have historically experienced the greatest barriers to adequate and affordable health care, including Black non-Hispanic, Hispanic, and American Indian and Alaska Native people. A 2021 FTI Consulting report claims that hospitals serving minority populations in particular could be adversely affected by a public option, although this study relies on some unrealistic and unexplained assumptions regarding the changes in coverage and the impacts on hospitals under such a reform. Still, unsupported claims of this type should not impinge on policymakers’ ability to implement sound reforms that could reduce health care spending, for households and systemwide. Lowering the costs of medical care could increase the affordability of health insurance premiums and decrease the direct costs of necessary services, thereby improving access to care, particularly for populations facing the greatest barriers to obtaining them. In February 2021, Senators Tim Kaine and Michael Bennet reintroduced their Medicare-X Choice Act. If passed into law, this bill would create a government-administered insurance plan, or public option, available nationwide to those purchasing insurance through the private nongroup (i.e., individually purchased) insurance market or small employers. In fact, reducing disparities in access to care and outcomes is an explicit motivation for the Medicare-X Choice Act. The bill itself states that the reform seeks to “reduce health disparities (including racial, ethnic, socioeconomic, geographic, gender, sexual identity, and other disparities, including such disparities experienced by people with disabilities and older adults).” In addition, the bill allows reforms to be implemented on different time schedules across geographic locations to prioritize reducing these disparities. In this analysis, we use individual-level data from the Urban Institute’s Health Insurance Policy Simulation Model (HIPSM), as well as hospital data from the American Hospital Association Annual Survey, the RAND Corporation Hospital Price Transparency Study, and the Centers for Medicare & Medicaid Services Healthcare Cost Report Information System to provide insights into the likely effects of a Medicare-X-style public option reform on hospital revenues and family health care spending. Our particular focus is on how these effects would vary across the country and across different racial and ethnic groups. This analysis can help contextualize the implications of a public option for access to care. Because hospital spending is the largest single contributor to overall spending on medical care, this analysis focuses largely on the implications of a Medicare-X-style public option for the hospital sector.
- Copyright:
- Reproduced with permission of the copyright holder. Further use of the material is subject to CC BY-NC-DC license. (More information)
- Extent:
- 1 online resource (1 PDF file (v, 26 pages))
- NLM Unique ID:
- 9918627779906676 (See catalog record)
- Permanent Link:
- http://resource.nlm.nih.gov/9918627779906676