John Sheils joined The Lewin Group in 1980. He is well known for his depth in understanding the complexities of the health care financing system, for the professional integrity of his analyses, and for the speed with which he can produce estimates of comprehensive reform plans. John is a nationally recognized authority on health system reform and Medicaid eligibility who has directed several projects for Medicaid programs around the country. John received a Master of Science in Public Policy from Carnegie Mellon University.
Any time the government requires someone to make a payment that they would not have made voluntarily, it is a tax. While this is not necessarily true in a legal sense, it will certainly feel like a tax to those who are compelled to purchase insurance, even for those receiving subsidies. On one level, it doesn’t matter whether all or part of the cost of the individual mandate appears on the federal budget. For example, you could count all expenditures for the purchase of insurance as federal expenditures while counting individual premium payments as tax revenues (assuming the data could… Read more
Cost Containment with a Down-sized Public plan The public plan is the primary tool for controlling costs for the non-Medicare population under the health reform bills now emerging in Congress. Premiums under a public plan modeled on Medicare would be up to 30 percent less than for comparable private insurance due to the lower provider payment levels under Medicare. However, if the public plan is substantially restricted or eliminated, there is little remaining in these plans that would slow cost growth for the non-Medicare population. For example, Senator Baucus’ recent reform options papers describe several cost containment initiatives including: investments… Read more
The proposal to fund comparative effectiveness research is inspired by studies showing substantial overuse of care by some patients while many others go without needed care. Researchers have documented extreme variation in medical practice and spending across the nation and have shown that there appears to be little or no relationship between spending levels and health outcomes. Fisher and Wennberg et al. have suggested that eliminating these variations in practice could reduce Medicare costs by up to 30 percent. Funding comparative effectiveness research would produce evidence-based medical (EBM) guidelines that assist physicians in providing the best possible care. Unfortunately,… Read more
Wage Effects and Job Loss under an Employer Mandate The biggest problem with an employer mandate is its effect on worker incomes. The employers’ cost of complying with the mandate will be passed-on to the worker as reduced wages, probably in the form of reduced wage growth. If the employer cannot reduce wages, as in the case of minimum wage workers, some of these workers will lose their jobs. This assessment squares with economic theory and research. The theory in a nutshell is that workers are ultimately paid on the basis what the worker’s productive outputs can be sold for.… Read more
Impact of an Illustrative Public Plan President Obama has proposed to create a “public plan” that would compete for business with the private insurance industry, but has provided few details on how it would work. During the 2008 campaign, Senators Clinton and Edwards proposed a public plan administered through Medicare using Medicare provider reimbursement levels. Employers and individuals would have been able to purchase coverage from the public plan by paying a full cost premium. Premiums would be 30 percent or more less than premiums for comparable private coverage due to low payment levels and administrative… Read more
The problems in health care do not rise to the level of emergency that would justify further mortgaging our children’s future with yet more deficit spending. Good reform proposals exist that would cover all Americans without increasing what we spend on health care. In the meantime, there is plenty of meaningful cost containment we can pursued now without another orgy of deficit spending.… Read more
It is important not to overstate the potential impact of helping the uninsured to purchase COBRA benefits. Several studies have shown that roughly two-thirds of all workers would be eligible for COBRA if laid-off. These include covered workers in insuring firms that are subject to the COBRA requirement – i.e., firms with 20 or more workers. However, historically, most of those losing jobs have been concentrated among firms that do not offer health insurance and therefore are not eligible for COBRA. An article by Kapur and Marquis (Health Affairs, 2003) showed that only 21 percent of the… Read more
Can We Actually Spend the Money that Fast? The biggest problem we will have with the economic stimulus package in general is spending the money fast enough to make a difference. It won’t be easy to give away $20.0 billion over two years for HIT as proposed in the economic recovery package. Existing HIT grants processes are inadequate to handle this much money. The Agency for Healthcare Research and Quality (AHRQ) currently provides about $166.0 million for HIT research and 17 states currently provide $124.7 million in funding for HIT implementation (National Conference of State Legislatures). The best way to… Read more
The most important thing we can salvage from “health reform plans of old” is President Clinton’s goal of covering all Americans while reducing spending throughout the health care system. Just because the Clintons were not able to do it doesn’t mean it can’t be done. With the poor state of the economy and a staggering $1.0 trillion federal budget deficit on the horizon, it would appear that the federal government can not afford to implement a program of universal health insurance coverage at this time. However, comprehensive health reforms that assure immediate health insurance coverage for all Americans would cost… Read more
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