off topic here but I hope I can get a response: Trying to find a Goozner piece written years ago abaout the mistake of airline deregulation and how to reregulate wisely. I've searched Google and can't find it anywhere. Help?
Sorry for the delayed response. I couldn’t find it via Google, either. I think it was an American Prospect piece written about 20 years ago. I will search my files when I return home in about a week.
In the 1970’s, worth mentioning, that many states adopted state-level all payer hospital rate setting. In the 80’s they deregulated and stopped. Maryland kept it in place. They’ve had lower cost trends. The federal authority for states to implement all payer rate setting still exists.
Quality also encourages monopoly because for rare, complex, and expensive treatments higher volume facilities have higher quality. So monopoly in healthcare ironically results in higher quality. Good example are Children’s Hospitals. You don’t want three mediocre Children’s Hospitals in a region. You want one great one.
Additionally, do know anyone who wants to chose the low cost provider for their cancer care. Anyone willing to clip coupons for their colonoscopy? It’s an irrational product. We’re not price sensitive.
The utility analogy is very apt. There is NO other way to lower costs without price controls in healthcare.
Thanks for mentioning the Maryland experience, which I left out in my haste. I've been touting their "single pricing" regulations for years (including in a two-part series in Health Affairs last year). When CMMI released its AHEAD model, it called for proposals that followed Maryland's "total cost of care" budgeting approach. Alas, it didn't include calls for single pricing since that would level payments from all payers and require higher prices for government and lower prices for the private sector, which would require major tax reform to make possible.
Price controls in the form of mandated fee schedules have been instrumental in controlling medical costs in workers compensation. While certainly imperfect, when intelligently designed and effectively implemented they have been enormously effective. As a result medical inflation in workers compensation has been flat to low single digits for close to a decade.
off topic here but I hope I can get a response: Trying to find a Goozner piece written years ago abaout the mistake of airline deregulation and how to reregulate wisely. I've searched Google and can't find it anywhere. Help?
Sorry for the delayed response. I couldn’t find it via Google, either. I think it was an American Prospect piece written about 20 years ago. I will search my files when I return home in about a week.
In the 1970’s, worth mentioning, that many states adopted state-level all payer hospital rate setting. In the 80’s they deregulated and stopped. Maryland kept it in place. They’ve had lower cost trends. The federal authority for states to implement all payer rate setting still exists.
Quality also encourages monopoly because for rare, complex, and expensive treatments higher volume facilities have higher quality. So monopoly in healthcare ironically results in higher quality. Good example are Children’s Hospitals. You don’t want three mediocre Children’s Hospitals in a region. You want one great one.
Additionally, do know anyone who wants to chose the low cost provider for their cancer care. Anyone willing to clip coupons for their colonoscopy? It’s an irrational product. We’re not price sensitive.
The utility analogy is very apt. There is NO other way to lower costs without price controls in healthcare.
Thanks for mentioning the Maryland experience, which I left out in my haste. I've been touting their "single pricing" regulations for years (including in a two-part series in Health Affairs last year). When CMMI released its AHEAD model, it called for proposals that followed Maryland's "total cost of care" budgeting approach. Alas, it didn't include calls for single pricing since that would level payments from all payers and require higher prices for government and lower prices for the private sector, which would require major tax reform to make possible.
Price controls in the form of mandated fee schedules have been instrumental in controlling medical costs in workers compensation. While certainly imperfect, when intelligently designed and effectively implemented they have been enormously effective. As a result medical inflation in workers compensation has been flat to low single digits for close to a decade.
I'd call it "price negotiations" vs "price controls" for political expediency, but I agree it's an important component.