With Roots In California, Managed Competition Still Aims To Reform Health Care.

Managed competition is a concept that was born in California and has achieved a measure of acceptance there. As California and the United States as a whole continue to struggle with the challenge of providing high-quality health care at a manageable cost, it is worth asking whether managed competition-with its tools for harnessing market forces-continues to hold promise as a means of improving value in health care, and whether the standard conceptualization of managed competition should be modified in any way. In this article we reflect on four aspects of California's health care ecosystem that provide insights into these questions: integrated delivery systems, patients' choice of health plans, quality measurement, and new health care marketplace architectures such as Covered California and private insurance exchanges.

Improving The Affordable Care Act: An Assessment Of Policy Options For Providing Subsidies.

A key challenge of health reform efforts is to make health insurance affordable for individuals and families who lack coverage without harming those with coverage or increasing federal spending. The Affordable Care Act (ACA) addresses this challenge in part by providing tax subsidies to qualified individuals for purchasing individual insurance and retaining tax exemptions for employer and employee contributions to the cost of premiums of employer-sponsored insurance. These tax exemptions cost approximately $250 billion annually in lost tax revenue and have been criticized for favoring higher earners and conferring preferential treatment of employer-sponsored over individual insurance.

Integrated delivery systems: the cure for fragmentation.

Our healthcare system is fragmented, with a misalignment of incentives, or lack of coordination, that spawns inefficient allocation of resources. Fragmentation adversely impacts quality, cost, and outcomes. Eliminating waste from unnecessary, unsafe care is crucial for improving quality and reducing costs--and making the system financially sustainable.

'Redefining health care': medical homes or archipelagos to navigate?

This paper provides an analysis of the structure of the health care delivery system, emphasizing physician group practices. The authors argue for comprehensive integrated delivery systems (IDSs). The jumping-off point for their analysis is the recently published Redefining Health Care: Creating Value-Based Competition on Results, by Michael Porter and Elizabeth Teisberg.

Employment-based health insurance: past, present, and future.

We review the rise, stabilization, and decline of employment-based insurance; discuss its transformation from quasi-social insurance to a system based on actuarial principles; and suggest that the presence of Medicare and Medicaid has weakened political pressure for universal coverage. We highlight employment-based insurance's flaws: high administrative costs, inequitable sharing of costs, inability to cover large segments of the population, contribution to labor-management strife, and the inability of employers to act collectively to make health care more cost-effective. We conclude with scenarios for possible trajectories: employment-based insurance flourishes, continues to erode, or is replaced by a more comprehensive system.

Competition in health care: it takes systems to pursue quality and efficiency.

Many stakeholders agree that the current model of U.S. health care competition is not working.

Stanford University's experience with managed competition.

Stanford University has a "managed competition" model of health insurance. Stanford contributes the cost of the low-cost plan, and employees are responsible for premium differences between this plan and other offerings. Each employee gets what he or she wants and is willing to pay for, and everyone has low-cost access to health insurance.

Sustaining a market-based healthcare system.

Purchasers of health care are not holding the healthcare system accountable for quality and cost. Employers need to: Offer their employees a wide range of choices in health coverage. Earmark for employees' purchase a fixed dollar amount for health care set at or below the price of the low-priced plan.

Market forces and efficient health care systems.

The "market forces" to which economists ascribe the ability to motivate improvement in quality and efficiency are largely nonexistent in U.S. health care.

Employment-based health insurance is failing: now what?

Employment-based health insurance is failing. Costs are out of control. Employers have no effective strategy to deal with this.