Multistate Health Plans: Agents for Competition or Consolidation?

We discuss and evaluate the Multi-State Plan (MSP) Program, a provision of the Affordable Care Act that has not been the subject of much debate as yet. The MSP Program provides the Office of Personnel Management with new authority to negotiate and implement multistate insurance plans on all health insurance exchanges within the United States. We raise the concern that the MSP Program may lead to further consolidation of the health insurance industry despite the program's stated goal of increasing competition by means of health insurance exchanges. The MSP Program arguably gives a competitive advantage to large insurers, which already dominate health insurance markets. We also contend that the MSP Program's failure to produce increased competition may motivate a new effort for a public health insurance option.

Expanding choice through defined contributions: overcoming a non-participatory health care economy.

The fate of the Patient Protection and Affordable Care Act of 2010 is uncertain. Much of the opposition is grounded in popular hostility to expansive federal control over individuals' health care decision-making. But the new law reinforces existing third-party payment, primarily through employers and government programs. This financing already restricts personal choice of health plans and coverage options. Private employers, managed care executives, and public officials make the key spending decisions in health care. Unlike consumers in other sectors of the economy, individuals are mostly passive spectators. Normal market dynamics do not exist, and consumer choice is frustrated. Curiously, public programs, such as the Federal Employees Health Benefits Program (FEHBP), the Medicare Advantage Program, and the Medicare Part D Drug program, are the main exceptions to the norm. In these programs, individuals control the flow of dollars over the purchase of health plans. In crucial areas such as access to care and benefits, cost control, quality, and patient satisfaction, these programs have a strong record. By realigning health reform with the primacy of personal choice, and building on the experience of these programs, policymakers can expand consumer control through defined-contribution financing. Specifically, Congress can replace the existing tax regime for commercial private health insurance with a national tax credit system, provide generous financial assistance for the poor, and transform Medicare into a "premium support" program.

Healthcare reform wars.

What's wrong with the current healthcare system, and who's to blame? How can government-run healthcare be avoided? Dr Moffit, from The Heritage Foundation in Washington, DC, analyzes the problems of the current system, explains the pitfalls of proposed reforms, and offers a solution for saving the traditional private practice system.