John C. Goodman, Ph.D. founded the NCPA in 1983 and has served as President since the center's inception. The Wall Street Journal called Dr. Goodman "the father of Health Savings Accounts," and National Journal declared him "winner of the devolution derby" because his ideas on ways to transfer power from government to the people have had a significant impact on Capitol Hill.
Dr. Goodman is the author of nine books, including Lives at Risk: Single-Payer National Health Insurance Around the World; Leaving Women Behind: Modern Families, Outdated Laws; Economics of Public Policy, a widely used college textbook, and Patient Power: Solving America's Health Care Crisis, the condensed version of which sold 300,000 copies and is credited with playing a pivotal role in the defeat of the Clinton administration's plan to overhaul the U.S. health care system.
He has authored numerous editorials in The Wall Street Journal, USA Today, Investor's Business Daily, Los Angeles Times, The Dallas Morning News, Houston Chronicle, The San Diego Union-Tribune, and many others.
Dr. Goodman regularly appears on television, including PBS' The NewsHour with Jim Lehrer, CNN, CNBC and the Fox News Channel. He was a debater on several of William F. Buckley Jr.'s Firing Line shows, and has appeared on a number of two-hour prime time debates, including debates on the flat tax, welfare reform and Social Security privatization.
He regularly briefs members of Congress on economic policy issues and frequently testifies before congressional committees. He is author/co-author of more than 50 published studies on such topics as health policy, tax reform and school choice. Dr. Goodman has an active speaking schedule and has addressed more than 100 different organizations on public policy issues. He received the prestigious Duncan Black award in 1988 for the best scholarly article on public choice economics.
Dr. Goodman received a Ph.D. in economics from Columbia University. He has taught and done research at several colleges and universities including Columbia University, Stanford University, Dartmouth University, Southern Methodist University and the University of Dallas.
This is an anecdote I have at my blog. It’s what they call “universal coverage” in Massachusetts: I get my health care through MassHealth [Medicaid in Massachusetts] and I went through 20 names before I finally found a doctor who would see me. I wasn’t going through the Yellow Pages. I was going down a list that MassHealth gave me!… Read more
I've read Uve's comment several times and cannot make sense of it. But then the question we are answering is sort of nonsensical. Universal coverage has not been the goal since the Democratic Primary contest ended -- some time last August. Now there is only one goal: pass a bill.… Read more
You have to wonder what took these guys so long. They have been negotiating in good faith for 10 months while Obama and the Democrats have been hammering away at them in public -- calling them evil, selfish and you name it. I suspect the PWC study is correct. If anything, it may err on the conservative side. Everywhere guaranteed issue and community rating have been imposed, premiums increase substantially. How could it be otherwise? And yes. These premium increases are a tax on the middle class. They are being forced to pay for someone else's benefits. Remember Obama's campaign promise:… Read more
In every other area of our economy, we have straightforward way to separate the good ideas from the bad ones with respect to low-cost, high-quality production. It’s called a competitive marketplace. People with the best ideas succeed and make profits. People with the worst ideas fail and go out of business. I can think of only one other field where we invite people who are not actually in the trade (including politicians) to tell the producers how to produce: Education. Nonteachers have teen telling teachers how to teach for 25 years. How well has it worked? About as well as nondoctors telling doctors how to… Read more
Does money spent to encourage wellness pay for itself? Probably not. But why would you want to spend your money to encourage me to live a healthier lifestyle? Why do you care whether I do 50 sit-ups a day or 25 or zero? It’s only because we have a dysfunctional insurance system that allows me to impose the costs of my bad behavior on you. And vice versa. So you can plead, cajole, lecture, fine, and harass me. And I you. Or we can both try to create an insurance system in which people pay the full costs of their bad behavior and reap… Read more
Why would anyone want to expand Medicaid? Do the commentors here harbor some fiendish desire to punish people? One study found that the uninsured were able to get a doctor’s appointment quicker than Medicaid patients. American Cancer Society research shows that in terms of delays in the detection and treatment of cancer, Medicaid enrollment is only marginally better than being uninsured. June and Dave O’Neill found that mortality among Medicaid enrollees is significantly higher than for the uninsured. If all this is not bad enough, expansion of Medicaid eligibility causes people to drop their private coverage (which allows them access… Read more
Addendum: Did you know that doctors who work for government already have malpractice protections other doctors don’t have. Doctors who work for the VA, or a federal health clinic, or for most state governments, are not subject to the same jackpot justice system other doctors live under. For an explanation, see Linda Gorman’s post on malpractice law at my blog.… Read more
State experimentation means fighting the trial lawyers state by state. Hard to do. And even after you win (as occurred here in Texas) they’re back next year trying to undo everything you have accomplished. So I’m for a national solution that gets lawyers out of this once and for all. To solve the problem, get all the incentives right at every margin and dispose of lawyers, judges, juries, and court rooms, all in one fell swoop, I have outlined the ten steps to take.… Read more
The problem with Uwe Reinhardt’s advice is that the president has absolutely no plan to control costs. He never has had one. Last summer’s campaign rhetoric promised all gain and no pain thru preventive medicine, EMRs, etc. Now that those ideas have been blown out of the water by the CBO, everyone is waiting for some new idea. None has been forthcoming. To the contrary. The CBO says that all versions of Obama Care on Capitol Hill will increase health care spending. Independent analysts agree. So I second Uwe’s suggestion that the president should tell the American people what will… Read more
Senator John McCain’s health plan would have insured just as many people as Barack Obama aims to insure – and at no additional cost to the Treasury. It would have substantially lowered health care costs and may have increased quality as well. On the demand side, it would have created new incentives for patients to shop for care, based on price and quality. On the supply side, it would have created a national market for insurance. The financing mechanism was more progressive than anything that has been proposed on the Democrat side of the aisle. Barack Obama should… Read more
I decided to do a Health Alert – expanding on my comment – which is now posted at my blog. As far as Uwe’s query, yes. Everyone’s IQ tends to fall when thinking about health care. The question is: How long does it take to come to your senses? Some people apparently take longer than others. Cheers.… Read more
Marilyn, Why be so narrow? Let’s ask a much broader question: Suppose you could pay any premium you like for health insurance. What premium would you select? a. Would you choose to pay the fair market price (reflecting the expected cost of adding you to an insurance pool), guaranteeing that insurers would vigorously compete for your business? b. Or, would you choose a much lower premium, guaranteeing that no insurer would want you? c. Or, would you choose a really, really low premium, guaranteeing that insurers really, really would not want you? In thinking about this problem, it may be helpful to think about… Read more
Updated at 1:43 p.m. on Aug. 27. Senator Kennedy was kind and gracious in his treatment of me, even though we had different political views. His lasting positive contribution was in the area of deregulation of trucking and the airlines. In both cases, he was convinced that free market competition met consumer needs better than regulation. I never had the opportunity to speak in depth to him, one on one. Given the chance, I would have tried to convince him that what is true of trucking and the airlines is also true of health care. I would probably have… Read more
Most people are not in a position to know the answer to that question. For the past two months, trench warfare has been underway completely below the radar for the Washington press corps -- who tend to think everything important begins and ends in Washington, DC. At least once a week President Obama (or someone else from the White House or the DNC) has been sending talking and attack points by email to 13 million faithful recipients. In response, the NCPA has been sending counter messages over talk radio and by email to 1.1 million petition signers at freeourhealthcarenow.com I… Read more
The best way to keep up on developments is easy: bookmark the John Goodman Health Policy Blog. Best book: the one that outsells every other book except the Bible. Ayn Rand’s Atlas Shrugged. You will find Rand’s description of the US political and economic system eerily similar to today’s conditions, even though the book was written more than 50 years ago. Rand’s novel is at once a treatise on economics, politics, philosophy and psychology – challenging the prevailing doctrines in all four fields (this was 1958) – all wrapped up in a rip-roaring good mystery story. Along the way, she… Read more
The answer to “What’s in it for me?” is really rather simple. There’s very little in it for you. Or at least for most of you. Nothing in the bills before Congress will control cost. All the bills would create perverse incentives to undermine quality through unhealthy competition in a Health Insurance Exchange. And if Massachusetts is the guide, there may not be any increase in access to care. And in return for higher cost, lower quality and no better access, you will have the privilege of paying more taxes. Make that, a lot more taxes. Make that, more taxes… Read more
I’m in favor of a Medicare Czar with complete authority to form contracts with providers. And no ability of Congress to override the decisions. But I’m 100% against this idea if Peter Orszag is the Czar. I like Peter. He’s smart. He’s capable. He’s competent. But his idea on how to reform Medicare is completely wrong. As the CBO has affirmed, it will save no money. Zip. Zero. Nada. And it may harm patients. There are many examples in our health care system of high-quality, low-cost care. They all originated on the supply side of the market. Not one of them was created by Blue Cross, Medicare, or any other… Read more
The only surprise here is that anyone is really surprised by what Elmendorf had to say. First, the CBO months ago looked at all the cost control campaign promises of candidate Obama and concluded that none of them significantly control costs. Second, these bills are going to create a new entitlement (a cap on how much anyone has to pay for insurance as a percent of income) adding to an already unsustainable entitlement burden. Third, the legislation will inject from $100 billion to $150 billion in new spending into the health care system every year. If you are surprised that… Read more
The idea that health reform is being financed by concessions made by key special interests is a complete illusion. Everyone should remember TANSTAAFL (There Ain’t No Such Thing As A Free Lunch). At the end of the day, hospitals will collect enough revenue to cover their costs, just as they currently do. Drug companies will earn a rate of return needed to attract capital and it will be among the highest in any industry. Employers – at least those that remain in business – will cover their costs and supply shareholders with their required rate of return. So who is really… Read more
Some patients have difficulty buying some expensive drugs. But in general, the cost of drugs is not a social problem. To the contrary, the return we are getting on drugs, at the margin, is higher than the return we are getting on doctor or hospital therapies. We should be spending even more than we currently spend to encourage more R & D. If there is a social problem, it is that we are underutilizing drugs for most chronic conditions. But in most cases, more third-party insurance is not the answer. Rather, we need more self-insurance (through HSA’s, for example) so… Read more
I agree with James and Dan. All the economic evidence shows that health insurance is a dollar for dollar substitute for wages. A mandate on employers, therefore, is a stealth mandate on employees. The ultimate burden falls completely on the shoulders of workers.… Read more
With all due respect, Sen. Daschle has gvien us the wrong diagnosis and the wrong solution. We are in trouble because every single actor in the health care system faces perverse incentives. That includes 300 million patients, about 800,000 doctors, every nurse, every hospital administrator, every employee, every employer, every insurer, and every government agency (did I leave out anybody?). The incentives are not just a little bit perverse. They are very, very perverse. No amount of "management" can make things work as long as social cost exceeds social benefit for every actor at every margin. True reform does not… Read more
Here's my advice: Take the same oath doctors take -- first, do no harm. That means (1) do not push an additional $150 billion a year into the health care system, since that will inevitably create more health care inflation; (2) do not set up an artificial insurance market in which every health plan has a financial self interest in overproviding to the healthy and underproviding to the sick, since that will undermine the quality of care everyone receives; and (3) do not encourage millions of Americans to give up their private insurance and enroll in Medicaid instead, since that will… Read more
I think waiting for health care legislation will get everyone in the right frame of mind. After reform is enacted, we almost certainly will be waiting longer for our own health care. Waiting in Boston is twice as long as in any other city and ER visits for nonemergency care are the same today as they were three years ago [here is the link]. Massachusetts is beginning to look like Canada. … Read more
So far President Obama has been masterful at messaging. Both the health care media and the Congressional Republicans have let him get away with completely contradictory claims. While claiming that America spends too much on health care and promising to do something about it, Obama at the same time proposes to spend an additional $1.5 trillion over the next ten years. While claiming that we must do something to control health care costs, Obama proposes to inject an additional $150 billion in spending every year -- a move that will inevitably lead to more health care inflation. While claiming he… Read more
Some very good suggestions on how to stop Medicare and Medicaid fraud are in Jim Frogue’s Testimony before U.S. Senate Special Committee on Aging. Also discuss at my blog.… Read more
Think of the irony here. On the one hand, we are told how wonderful it is that Medicare's administrative costs are so low. On the other hand, we are told how awful it is that there is so much fraud. Do you think there could be a connection?… Read more
The biggest problem with vaccine production is the government stranglehold on pricing, limiting profits to the vaccine manufacturers. The government buys more than half of childhood vaccines and a substantial portion of flu vaccines – at prices that are very low. This is arguably why vaccine makers were slow to invest in the costly new technology and excess capacity needed to respond quickly to immerging threats like the H1N1. This is part of the reason why the U.S. is not prepared for a pandemic of the type that has panicked the public in the past week. It takes 24 weeks… Read more
There is no reason to worry about Medicare’s Trust Fund. Or the Social Security Trust Fund. Or the Highway Trust Fund. Or any other federal government trust fund ― with one or two exceptions. The reason? These are not really trust funds. They do not collect or disperse money. They hold no real assets. They perform an accounting function (keeping track of the inflow of dedicated revenues and the outflow of funds to the programs they support), which occasionally forces Congress to act. But they perform no economic function (collecting, saving, investing, etc.). No money has been salted away in… Read more
There is nothing in principle wrong with comparative effectiveness research (CER). It goes on all the time, often with federal funding. The reason for the controversy is a proposal in Tom Daschle's book to use CER the way it is used by the British agency with the ironic acronym NICE. In Britain, NICE has decided that the National Health Service should not spend more than about $35,000 to save a year of life. Doctors, hospitals and area health authorities typically follow these guidelines. As a result, British cancer patients are typically denied access to drugs that are routinely available in… Read more
Uwe Reinhardt is wrong on three points. (In baseball this would be called a strike out.) First, we do not need a trillion dollars to achieve Obama's goal (insuring half the uninsured) and if we tried to spend that much we would probably make things worse. According to Lewin, both the Coburn plan and the original McCain plan achieve the goal without any increase in government outlays. Ironically, both plans involve considerable redistribution from high-income to low-income families. Second, crowd out is hugely important. Over the last two decades we have spent an enormous amount of money inducing millions of… Read more
This reform is being proposed by people who (a) tell us that the primary reason for reform is that we spend twice as much as other developed countries and receive no better health care in return, (b) then propose to solve the problem by spending an extra $150 billion a year for ten years, and (c) now propose to cover up the costs of the reform by cooking the books. It may be helpful to review the bidding on the so-called "savings." All the proposals that the Obama team claims will save money were meticulously examined by the CBO (when… Read more
All over the developed world there is a tendency to control health care costs by squeezing the providers of care. We have seen the same tendency in Medicare and Medicaid in the United States. Under Obama health reform, expect more of the same. Yet shifting costs from one group to another is not the same thing as controlling costs. Cost shifting disguises social costs and gives the false appearance of having controlled them. Ironically, the best way to control health care costs is to liberate providers. Free them to repackage and reprice their services any way they like, provided the cost to government does… Read more
A mandate on employers, similar to one proposed by the Commonwealth Fund and endorsed by Barack Obama during the campaign, would be very bad. A tax on wages of 6% up to $1.25 an hour, in lieu of health insurance, pretends to be a burden for employers. In fact it would be a tax on labor. If combined with the opportunity to buy insurance in an external Exchange at no more than 10% of income, it would cause the current employer-based system to unravel. Employers would drop their coverage in droves. They would pay the fine and give workers the… Read more
What can a public plan do that a private plan cannot do better? Since Medicare is run by Blue Cross almost everywhere, what is it that Blue Cross does for the government that it cannot do better for the private sector? What can UnitedHealth or Aetna do for Medicaid, that they cannot do better for the private sector? If the answer is nothing, and I believe it is nothing, then what could possibly be the point of a public plan other than to give meddlesome politicians the opportunity to arbitrarily redistribute cost and benefits to different groups under the guise of… Read more
First, Medicare’s financial problems are huge –- it has six times the unfunded liability of Social Security. Second, the Medicare Trust Fund is irrelevant because it consists of nothing more than IOUs the government has written to itself. In a pay-as-you-go system, the only thing that matters is cash flow. Third, Medicare currently has a cash flow deficit that will grow larger through time. When combined with Social Security and Medicaid, these entitlement programs threaten to crowd out every other federal program. Fourth, although we desperately need to fix the long run problem by moving to a funded system, prudence… Read more
We are making three very, very big mistakes: 1. Believing that we can control health care costs without having anyone choose between health care and other uses of money. 2. Believing that we can improve quality without having providers compete for patients based on quality. 3. Believing that we can improve access by inducing people to drop their private coverage and join public plans that pay providers below market rates.… Read more
The worst idea candidate Barack Obama had during the presidential campaign was his pledge to finance health reform with taxes on capital. To be fair, he didn’t word it that way. Instead, he promised to pay for universal health care in part by rescinding George Bush’s “tax cuts for the rich.” Bush didn’t cut taxes for the rich, however. He lowered the tax rate on capital gains income and a substantially lowered the tax rate on dividend income for all taxpayers, many of whom have high incomes. Bush also lowered the top rate on wage income; but for high-income… Read more
We can begin by recognizing the problem – which too many Democrats (and even some health economists) have been denying for way too long. This may require an “intervention,” and maybe even 12 step rehab. But there is no way we are going to get agreement on a solution, until we get agreement on the problem. According to the Trustees, the unfunded liability in Social Security and Medicare is more than $100 trillion dollars (that’s trillion, not billion), or about 6 ½ time the size of the entire US economy. That’s the size of our commitments over and above expected… Read more
In Tom Daschle, President Obama had a talented individual who could well have led major health care reform. But the reform Daschle envisioned was a health care system shaped and molded by government. We would have increased taxes and increased government health insurance, turning the private insurance market upside down. And yet at the end of the day, we would have made little progress on the triple problems of rising cost, inadequate quality and lack of full access to care. Fortunately the opportunity now exists to move in a much more promising direction. Instead of command and control, let us… Read more
Free The Kids House and Senate Democrats are pushing to expand SCHIP eligibility to the middle-class. They seem undeterred by research from Obama’s own advisor, David Cutler, which determined that Medicaid expansion from the early 1990s resulted in a crowd-out rate of 49% to 74%. More recent work by Cutler’s co-author, Jonathan Gruber, found an average crowd-out rate of about 60% for SCHIP. Expanding SCHIP also runs the risk of reducing access to care as families drop private insurance to enroll in lower-cost public coverage. Public programs tend to reimburse providers at much lower rates than private coverage. As… Read more
I’m afraid that any bill that passes Congress is likely to do more harm than good. Why? Peter Neupert (Microsoft) knows more about health IT than just about anyone. This is from his testimony last Thursday: Congress … should take care not to mandate or prescribe any particular technology or development model. Doing so could deprive healthcare providers of the best available solutions, exclude scores of American companies and workers from competing to supply these solutions, and weaken incentives for further private-sector investment and R&D—just when we as a nation should be trying to strengthen these incentives.… Read more
What are the prospects for health reform? That depends on how flexible the new President turns out to be. Although Barack Obama was highly critical of John McCain’s health plan during the election, he actually needs key elements of the McCain plan. He also needs key elements of Mitt Romney’s health reform, about which he has already had complimentary things to say. He can also borrow an idea or two from Hillary Clinton. Here is how it might work. What Obama Needs from Clinton: An Individual Mandate. Ultimately, the decision to insure is an individual decision. Obama’s mandate for children… Read more
I would like to second John Rother's three considerations. Even if there were no adverse selection (which there surely will be), I don't believe Medicare can compete against private plans, charging a budget neutral premium. Remember, the average Medicare enrollee is currently paying three premiums to three plans ( Part B, Medigap, and Part D drug coverage) and still doesn't have the coverage most nonelderly Americans have (a donut hole on drug coverage, for example). So it is almost inevitable that the premium will not be actuarially fair. That means a subsidized premium. That means a new entitlement. And just… Read more
I agree with Stuart and James and would add two additional points. If it really looks like Medicare, it will not be very attractive. Most Medicare enrollees pay three premiums to three plans (basic Medicare, Medigap, and prescription drug insurance) and still have less coverage (e.g. the "donut hole") than the rest of the population typically has. It will be even more unattractive if the public plan pays Medicare rates. Many doctors today will not accept new Medicare patients and in some specialties Medicare patients face much longer waits for treatment than younger patients. If a large number of people… Read more
Interesting you should invite us to think about the enactment of Medicare and Medicaid in the context of thinking about the cost of health reform today. I read David Blumenthal’s NEJM article. The lessons he takes away from the Medicare experience are very different from the lessons I glean. Here are five: 1. The cost of Medicare and Medicaid was way beyond what anyone predicted. The reason: failure to realize that when any good or service becomes free, people will consume more of it. 2. Once started, these programs are extremely hard to curtail or even modify. If we ended… Read more
Sen. Daschle’s Federal Health Board would be modeled after Britain’s National Institute for Clinical Evidence (NICE). It doesn’t work there. It won’t work any better here. Sen. Daschle is essentially saying, “I don’t know how to solve these problems; so let the experts decide.” Unfortunately, the “experts” don’t have any idea how to solve the problems either. The reason: on the patient side, all the difficult decisions involve value tradeoffs (which differ a lot from person to person) and on the provider side, efficiency is an economic concept, not an engineering one. Take cancer care. For most cancers, conventional therapies… Read more
Grace Marie is right. The two most important reforms are (1) tax equity and (2) a national market. University of Minnesota economists' studies imply that these two changes alone (ala McCain) would cut the uninsured in half -- at no additional cost to the taxpayers!!! In general, almost every problem in health insurance -- including the highly dysfunctional small group market -- arises because premiums do not reflect expected health care costs. The reforms suggested by Jon and Paul would make these problems worse. Finally, the individual market could be used to promote personal and portable insurance, the lack of… Read more
Am I the only blogger here who sees a problem with the Baucus proposal? After all, it is little more than a Clinton/Obama rehash that (by inference) almost half the country just voted against. It would: • Expand Medicare and Medicaid at a time when the CBO and the Social Security Trustees tell us entitlement spending threatens to bankrupt us. • Create and additional, unaffordable entitlement for the non-elderly middle class. • Impose a pay-or-play tax on labor at the very time when unemployment is rising. • Make individually purchased health insurance even less affordable than it already is. •… Read more
Ideal Job Description: 1. Knows economics. 2. Knows nothing about health care. 3. Knows about insurance, but nothing about health insurance. 4. Knows nothing about health policy. 5. Does not even have any friends who know anything about health policy. I'm actually half serious about this.… Read more
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