Government Role in Health Care Policy Describe

Government Role in Health Care Policy

Describe the characteristics of the uninsured? Additionally, why are concentrated interests and diffuse costs important when predicting legislative outcomes?

The uninsured are usually less wealthy, less healthy, and less educated than the insured. Unlike the insured, who typically receive health care coverage through their employer, the uninsured bear the burden of health care coverage with no institutional support, save that of the government. Because many health care services are priced with insured consumers in mind, the price of health care services is often inflated far beyond the means of the average uninsured individual.

Concentrated interests and diffuse costs affect legislative outcomes through political lobbying and its effect on legislation. Concentrated interests, such as health care insurers, are very conducive to lobbying because they share very narrow and clearly defined economic interests that can be achieved through legislation. This allows lobbyists for concentrated interests such as health care insurers to present specific recommendations or even suggested legislative proposals to the legislators that they are in contact with.

Lobbying revolves around the objective of legislators to maximize probability of election or reelection to office. Concentrated interests further their own interests by paying for legislative benefits, such as the introduction of a particular bill in congress. Concentrated interests typically "pay" through campaign donations but also through political endorsements from the corresponding trade union.

2). What are the economic rationales for different types of government intervention in health care? Additionally, explain the rationale for requiring everyone to purchase health insurance or pay a penalty?

The first rationale for government intervention in health care is to compensate for imperfections in the market for health care services. In the market for health care services, consumers are often limited to licensed providers, meaning that consumers, as well as providers, lack perfect information about the market, which is necessary for a true efficient market.

Also, there does not exist a mobility of resources within the health care services industry. The provision of health care services is tightly regulated through professional licensure procedures as well as state and federal law. The barriers to entry limit the number of options available to consumers in the health care services market.

As a result of these market inefficiencies, health care is extremely inefficient and unaffordable for a large portion of Americans. Considering such a market, the government subsidizes the training of health care professionals as well as the provision of health care services to consumers lacking the means to afford health care services on their own.

Programs such Medicare and Medicaid exemplify the other major rationale for government intervention in health care, the redistribution of resources from the relatively well-off to the economically disadvantaged. These programs, as well as tax exemptions for employers who offer health insurance, are considered demand subsidies for the consumers who benefit from the programs.

The rationale for the mandatory health insurance provision is that it helps the government offset the cost of subsidizing health insurance, especially in the context of an expanded Medicaid program. Requiring people to carry at least basic health insurance coverage reduces long-term overall health care costs by allowing them to seek treatment before medical problems occur or develop.

3) What lessons can we infer from history around the efforts to enact National Health Insurance and/or Health Reform?

National health care reform has been impeded by a number of factors. Among the most influential are the complexity of the issues, ideological differences, the lobbying strength of special interest groups, a weakened Presidency, and the decentralization of Congressional power.

The public is generally unfriendly to proposals which involve additional financial obligations on the part of individuals towards health care costs. For example, the Committee on the Costs of Medical Care proposed group medicine and voluntary insurance during the 1920's and faced heavy opposition from much of the electorate. Although the American public has always supported the idea of guaranteed health care access for all, they have also been wary of any new financial obligations created by the government, viewing them much in the same way they view new taxes. There is an unwillingness to recognize the relationship between individual contributions and universal health care access.

The history of health care reform suggests that the individual mandate provision attached to the current health care reform law will be a source of public discontent for some time to come. In fact, it has already proved to be the major weakness of "Obamacare," as it has been derisively referred to by its opponents. The individual mandate provision strikes many as a government intrusion on individual liberty and possibly a deprivation of property. It has been pounced on by President Obama's political opponents, tarnishing the centerpiece legislative achievement of Obama's first term. Although the individual mandate provision survived a recent Supreme Court challenge, Justice Scalia defined the individual mandate contribution as a new tax on individuals, leaving it open to continued criticism and challenges.