Fluent Essays

THE DIRECTIONS ARE ATTACHED. THE NECESSARY READING DOCUMENTS ARE ALSO ATTACHED, AND ARE LINKED TO THE QUESTIONS TO HELP GUIDE YOU.READING 1.A. – MORAL HAZARD Every health care finance system must struggle with the problem classically called Moral Hazard. By its very nature, insurance dramatically lowers the price of health care to the immediate consumer. Absent cost sharing, insurance lowers the price of health care to zero. The demand for a valued good or service that is offered wholly without cost, however, could expand infinitely. If the only cost of health care services is the time and discomfort incurred in consuming them, the demand for health care products and services is potentially (theoretically) very large. Moral hazard is a problem with respect to virtually all kinds of insurance (and indeed is an issue whenever the possibility exists for the costs of production or consumption to be externalized - that is, for someone other than the consumer to be incurring them). But; it is in particularly a problem with respect to health insurance because the need for many health care services is determined by the professionals who provide those services. There is, therefore, considerable opportunity in health care for providers to induce demand for their own services. If these services are free to consumers, however, consumers have no reason to constrain their use of services. They will also have no reason to question the prices charged for services. Indeed, physicians are likely to not discuss prices with patients (and perhaps not even to know or to consider the prices of the services that they recommend). While insured services are free to consumers, however, insurers must still pay market prices for them. If consumers do not constrain the utilization and price of health care products and serviced, there is a danger that the costs paid by insurers for health care will expand uncontrollably. But if insurers attempt to constrain demand either through their own utilization controls or through provider incentives, it is likely that rationing will result, either by the insurers, the providers, or both. Moreover, if health care is free, consumers may forgo taking measures like eating properly, exercising, and refraining from smoking, knowing that insurance will always pay to repair the damage later after they experience the health consequences of their bad behavior.   Health policy experts generally agree that moral hazard is a problem, but disagree as to how serious a problem it is. · Some experts believe that it is not a major problem. People rarely consume health care services unless they really need them · Other experts believe that the real problem is consumer demand encouraged by the collective sharing of risk among members of group health insurance pans. The way to solve this problem is the imposition of varying types and levels of cost-sharing and out-of-pocket expenditures on health insurance plan members. · Other experts believe that the real problem is NOT consumer demand but rather demand induced by providers, and that there are ways ofREADING 1. - OVERVIEW: BASICS OF THE PHILOSOPHY OF CONSUMER – DIRECTED HEALTH CARE AND HEALTH INSURANCE PLANS: KEEP IN MIND THAT THERE IS NOT A CONSENSUS ABOUT MANY OF THE VIEWS WE ARE READING ABOUT AND WILL BE DISCUSSING. THERE IS A FUNDAMENTAL DIFFERENCE BETWEEN ADVOCATES OF CONSUMER DIRECTED HEALTH CARE (CHDHC) AND THOSE WITH A MORE SOCIALLY ORIENTED APPROACH TO THE DEMAND FOR PERSONAL HEALTH CARE SERVICES AND THE IMPORTANCE OF BROADLY AVAILABLE GROUP HEALTH INSURANCE. QUITE SIMPLY, CDHC ADVOCATES BELIEVE THAT PERSONAL HEALTH CARE GOODS AND SERVICES ARE PREDOMINANTLY WANTS, NOT NEEDS – IN OTHER WORDS, SPENDING ON THOSE GOODS AND SERVICES IS LIKE SPENDING FOR A LAPTOP OR IPAD, OR A CAMERA. THEY THINK IT IS LARGELY DISCRETIONARY, NOT NECESSARY, EXPENDITURE. A. Advocates of Consumer Directed Health Care . The influence of these Advocates is currently seen in the prevalence of and membership in Federally approved and compliant Consumer Directed Health Plans, and in the general increase in ALL kinds of employer-based health insurance plans which require high deductibles, and high levels of out-of-pocket individual and family health services expenditures. Employer and insurance company emphasis on these kinds of health insurance plans and arrangements shows the extent to which Moral Hazard is a major concern for the health insurance industry and for the U.S. Health Care system. Moral hazard  is the danger that an insured party will lack the incentive to guard against risk when they have insurance to protect them against most or all of that risk. It is the idea that a party protected in some way from risk will act differently than if they didnt have that protection. We encounter moral hazard every day—tenured professors becoming indifferent lecturers, people with theft insurance being less vigilant about where they park, salaried salespeople taking long breaks, and so on. Moral hazard is usually applied to the insurance industry. Insurance companies worry that by offering payouts to protect against losses from accidents, they may actually encourage risk-taking, which results in them paying more in claims. Insurers fear that a dont worry, its insured attitude leads to policyholders with collision insurance driving recklessly or fire-insured homeowners smoking in bed. Advocates of Consumer Directed Health Care believe that group health insurance encourages people to purchase health goods and services they do not need, and encourages people to avoid personal responsibility for proper nutrition, seeking preventive care, and living in a healthy manner. This is because each health plan enrollee cross-subsidizes the other, and insurance substantially reduces the expense involved in accessing and using Personal Health Care Services, These advocates are less likely to see Personal Health Care Goods and Services as necessities which are essential for the well-being of individuals and families, and are critical Consumer-directed health plans: Do they deliver? -ROBERT WOOD JOHNSON SYNTHESES PROJECT/POLICY BRIEF NUMBER 24, OCTOBER 2012 FEDERALLY QUALIFIED CONSUMER DIRECTED HEALTH INSURANCE PLANS (CDHPs): The definition of CDHPs is rather fluid, but they are often associated with three features: · A relatively high annual deductible, · A personal spending account, and · The availability of decision support tools for enrollees. In practice, however, not all CDHPs have all three features. For purposes of this policy brief, a CDHP is defined as a high-deductible plan which is accompanied either by a Health Reimbursement Arrangement (HRA) or is eligible for a Health Savings Account (HSA). The majority of the research evidence on which this brief is based is from employment-based settings in which high-deductible health plans are offered with an HRA (see below). TAX TREATMENT OF CDHPs : The development of CDHPs was strongly influenced by federal regulations adopted in early 2000 which established favorable tax treatment for personal spending accounts. HRAs and HSAs serve similar functions, but have different rules and implications for consumers. Health Reimbursement Arrangements: HRAs are owned by the employer and only the employer is allowed to make contributions to the account. There is no limit to employer contributions; contributions are excluded from an employee’s gross income and not subject to taxes. Although unused funds may accumulate from one year to the next, should an employee terminate employment or switch health plans, the funds may revert to the employer. Health Savings Accounts: HSAs address one of the key limits of HRAs—a lack of portability. HSAs are owned by the individual, not the employer, making them portable across employment situations and health plans. Both employer and employee contributions to HSAs are excluded from the employee’s taxable income. Individuals and employers are allowed to establish or contribute to an HSA only when the individual is enrolled in a qualified high-deductible health plan. In 2012, the minimum qualifying deductible was $1,200 for individual and $2,400 for family coverage. The Patient Protection and Affordable Care Act (ACA) requires the health plans to cover certain preventive services without a deductible, although some CDHPs did this prior to the ACA.In 2006, about one in 10 employees had a health insurance deductible over This study is forcing economists to rethink high-deductible health insurance Updated by Sarah Kliff [email protected] Oct 14, 2015, 10:00am EDT (Shutterstock) This study is forcing economists to rethink high-deductible healt... https://www.vox.com/2015/10/14/9528441/high-deductible-ins... 1 of 9 10/13/17, 12:18 PM $1,000. Today? About half do. To health economists, this sounded like good news; theyve long theorized that higher deductibles would force down health-care costs. The idea was that higher deductibles would make patients become smarter shoppers: If they had to pay more of the cost, theyd likely choose something closer to the $1,529 appendectomy than the $186,955 appendectomy (yes, some hospitals really do charge that much). This would push the really expensive doctors to lower their prices so cheaper physicians didnt steal their business. This was, however, just a theory. And a massive new study suggests it might have been all wrong. Economists Zarek Brot-Goldberg, Amitabh Chandra, Benjamin Handel, and Jonathan Kolstad studied a firm that, in 2013, shifted tens of thousands of workers into high-deductible insurance plans. This was a perfect moment to look at how their patterns of care changed — whether they did, in fact, use the new shopping tools their employer gave them to compare prices. Turns out they didnt. The new paper shows that when faced with a higher deductible, patients did not price shop for a better deal. Instead, both healthy and sick patients simply used way less health care. I am a little bit surprised at just how poorly patients were able to do when looking at very similar products, like MRI scans, and with a shopping tool, says Kolstad, an economist at University of California Berkeley and one of the studys co-author. Two years in, and theres still no evidence theyre price shopping. This raises a scary possibility: Perhaps higher deductibles dont lead to smarter This study is forcing economists to rethink high-deductible healt... https://www.vox.com/2015/10/14/9528441/high-deductible-ins... 2 of 9 10/13/17, 12:18 PM shoppers but rather, in the long run, sicker patients. Higher deductibles mean sick people use less health care (Shutterstock) Kolstad and his co-authors looked at the case of a large, unnamed company that shifted more than 75,000 workers and their dependents from a plan with no This study is forcing economists to rethink high-deductible healt... https://www.vox.com/2015/10/14/9528441/high-deductible-ins... 3 of 9 10/13/17, 12:18 PM deductible to one with a $3,750 deductible. When the change happened, workers received a $3,750 subsidy to a health savings account — money they could spend freely on whatever health costs they incurred. The company also gave workers online tools to look up prices for doctor visits, tests, and other services they might need. Workers health spMarch 2020 | Issue Brief Disparities in Health and Health Care: Five Key Questions and Answers Samantha Artiga, Kendal Orgera, and Olivia Pham Executive Summary 1. What are health and health care disparities? Health and health care disparities refer to differences in health and health care between groups that are closely linked with social, economic, and/or environmental disadvantage. Disparities occur across many dimensions, including race/ethnicity, socioeconomic status, age, location, gender, disability status, and sexual orientation. 2. Why do health and health care disparities matter? Disparities in health and health care not only affect the groups facing disparities, but also limit overall gains in quality of care and health for the broader population and result in unnecessary costs. Addressing health disparities is increasingly important as the population becomes more diverse. It is projected that people of color will account for over half (52\%) of the population in 2050. 3. What is the current status of disparities? Although the Affordable Care Act (ACA) lead to large coverage gains, some groups remain at higher risk of being uninsured, lacking access to care, and experiencing worse health outcomes. For example, as of 2018, Hispanics are two and a half times more likely to be uninsured than Whites (19.0\% vs. 7.5\%) and individuals with incomes below poverty are four times as likely to lack coverage as those with incomes at 400\% of the federal poverty level or above (17.3\% vs. 4.3\%). 4. What are key initiatives to address disparities? The ACA’s coverage expansions and funding for community health centers increased access to coverage and care for many groups facing disparities, and other provisions explicitly focused on reducing disparities. At the federal level, the Department of Health and Human Services is engaged in a range of actions to implement its 2011 action plan to eliminate racial and ethnic health disparities. States, local communities, private organizations, and providers also are engaged in efforts to reduce health disparities, which increasingly encompass a focus on social factors influencing health. 5. What are current challenges to addressing disparities? Recent policy changes and current priorities may lead to coverage declines moving forward. Beyond coverage, there are an array of other challenges to addressing disparities, including limited capacity to address social determinants of health, declines in funding for prevention and public health and health care workforce initiatives, and ongoing gaps in data to measure and understand disparities. Disparities in Health and Health Care: Five Key Questions and Answers 2 1. What are health and health care disparities? Health and health care disparities refer to differences in health and health care between groups. A “health disparity” refers to a higher burden of illness, injury, disability, or morta2/11/2021 New research shows higher health insurance costs leads to more deaths - Vox https://www.vox.com/policy-and-politics/22276166/us-health-insurance-out-of-pocket-costs-research 1/4 A new study finds that higher copays for prescription drugs leads to patients cutting back on medications and, eventually, higher mortality rates. The economic argument for eliminating out-of-pocket costs, in one new study. By Dylan Scott @dylanlscott [email protected] Feb 10, 2021, 4:10pm EST Charging patients just $10 more for medications leads to more deaths | Brendan Smialowski/AFP via Getty Images It turns out $10 can be a matter of life and death, according to a new study on how patients respond to higher health care costs. Researchers at Harvard University and the University of California Berkeley examined what happened when Medicare beneficiaries faced an increase in their out-of-pocket costs for Millions rely on Vox’s explainers to understand an increasingly chaotic world. Chip in as little as $3 to help keep Vox free for all. Contribute Support our journalism × https://www.vox.com/authors/dylan-scott https://www.twitter.com/dylanlscott mailto:[email protected] https://www.nber.org/system/files/working_papers/w28439/w28439.pdf?utm_campaign=PANTHEON_STRIPPED&amp\%3Butm_medium=PANTHEON_STRIPPED&amp\%3Butm_source=PANTHEON_STRIPPED https://www.vox.com/support-now https://www.vox.com/pages/support-now https://www.vox.com/ 2/11/2021 New research shows higher health insurance costs leads to more deaths - Vox https://www.vox.com/policy-and-politics/22276166/us-health-insurance-out-of-pocket-costs-research 2/4 prescription drugs. They found that a 34 percent increase (a $10.40 increase per drug) led to a significant decrease in patients filling their prescriptions — and, eventually, a 33 percent increase in mortality. The rise in deaths resulted from people indiscriminately cutting back on medications when they had to pay more for them, including drugs for heart disease, hypertension, asthma, and diabetes. “We find that small increases in cost cause patients to cut back on drugs with large benefits, ultimately causing their death,” the authors — Amitabh Chandra, Evan Flack, and Ziad Obermeyer — wrote. “Cutbacks are widespread, but most striking are those seen in patients with the greatest treatable health risks, in whom they are likely to be particularly destructive.” It is difficult to come up with a study design that directly measures the effect of health insurance on health outcomes. These researchers overcame that problem by tracking the prescription benefits for people newly enrolling in Medicare when they turn 65. People with birthdays earlier in the year would be more likely to face higher out-of-pocket costs than people with birthdays later in the year, given the way Medicare’s benefits are designed. By comparing the data between the different age groups, using as a baseline an estimate of how much the paHSA 312 – MANAGED HEALTH CARE SPRING 2021: CONTEXT, QUESTIONS AND INSTRUCTIONS CASE STUDY 1: THE PROBLEM OF HIGH DEDUCTIBLES AND CONSUMER DIRECTED HEALTH CARE IN U.S. HEALTH INSURANCE DUE DATE – 11:59 PM, SUNDAY, MARCH 28, 2021 CONTEXT :UNDERSTANDING THE PROBLEM OF CONSUMER DIRECTED HEALTH PLANS AND HIGH DEDUCTIBLES: According to research by the Commonwealth Fund, a foundation focused on health care, 21.3 percent of Americans have insurance so skimpy that they count as underinsured: Their out-of-pocket health-care expenses, excluding premiums, amount to at least 5 to 10 percent of household income. The limits in coverage mean their plans might provide little financial protection in a health-care crisis. High-deductible plans offered by employers are one part of the problem. Among people covered by the companies they work for, enrollment in high-deductible health plans rose from 4 percent in 2006 to 30 percent in 2019, according to a report from the Kaiser Family Foundation. The average annual deductibles in such plans are $2,583 for an individual and $5,335 for families. · In theory, high-deductible plans, which make people spend lots of their own money before insurance kicks in, turn people into careful consumers. But research finds that people covered by such plans skip care, both unnecessary (elective cosmetic surgery, for instance) and necessary (cancer screenings and treatment, and prescriptions). Black Americans in these plans disproportionately avoid treatment, widening racial health inequities. · Health savings accounts are designed to blunt the harmful effects of high-deductible plans: Contributions by employers, and pretax contributions by individuals, help to cover costs until the deductible is reached. But not all high-deductible health plans offer such accounts, and many people in lower-wage jobs don’t have them. INSTRUCTIONS AND QUESTIONS 1. READ THE INDICATED READINGS, WHICH ARE ATTACHED . 2. PROVIDE WRITTEN RESPONSES TO THE QUESTIONS POSED BELOW. · Your response via BlackBoard Assignments should have the following format and follow the rules indicated below: · Single spaced. · In Arial 12 font. · Your response should be in a separate Microsoft Document attached to and submitted through Blackboard Assignment: CASE STUDY 1. · Each section of the response should correspond to one of the Questions below – 1.A., 1.B., 2.A., 2.B., 3.A., AND 3.B. WRITE 1 SHORT PARAGRAPH FOR EACH RESPONSE. · In your responses, without using too many sentences, use the attached documents to give your specific answer to each question. · If you have made and posted more than one response on Blackboard, I will read, grade, and respond to your most recent response by day and date. QUESTIONS – PROVIDE A WRITTEN RESPONSE: RESPOND TO QUESTIONS 1, 2, AND 3, EACH OF WHICH HAS A PART A. AND PART B. QUESTION 1: How is Consumer Directed Health Insurance Su