Transcript Slide 1

What is Health Policy?
HSA 6152
Spring 2007
Robert G. Frank
What is Policy Analysis?
• Multi-element process of assess and
analyzing components of a plan of action
– Not an exact science, more of an art
• Reviews the component parts of an issue
or problems
– Considers new options.
What is Policy Analysis?
• Multi-element process of assess and
analyzing components of a plan of action
– Not an exact science, more of an art
• Reviews the component parts of an issue
or problems
– Considers new options.
Policy Analysis
• New discipline
– Dates to early 1960s
• Policy analysis should
– Improve decision making
– Consideration of broad sets of alternatives
• Use of more systematic tools
Policy Analysis
• Neutral analysts
– Consider all options
• Advocates for best options serving
“national interest”
1970s
Amendments to the
Legislative Reorganization Act
• “Congressional declaration of analytic
independence from the administrative
branch”
– Created CBO, CRS, and OTA
Evolution of Policy Analysis
• Clients not only decision makers
– Individuals stewarding institutional
governance
• Planning
• Budgeting
• Regulation
Office of Assistant Secretary
for Planning and Evaluation
(ASPE)
• ASPE
– Principal policy advisor to the secretary
– Policy coordination, legislation development,
strategic planning, policy research and
evaluation and economic analysis
Office of Assistant Secretary
for Planning and Evaluation
(ASPE)
• Use of office has varied with
Administrations
– Staff vary, initially Ph.D.
economists…many from DoD
• Over time staff has varied
– Staff now serves entire department
– Also, other units have policy analysts, so
ASPE is only one voice to Secretary
Office of Assistant Secretary
for Planning and Evaluation
(ASPE)
Early methodology and analytic techniques
relied on economic models
Evolution to reliance upon policy expertise of
office vs. policy analysis
Needed skills for ASPE
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Program knowledge
Statistics
Microeconomics
Cost-benefit analysis
Congressional Research
Service
CRS
• Part of the Library of Congress
• Most recent incarnation dates to 1970
Legislative Reorganization Act
– Act allowed CRS to triple staff
– Now @ 700 individuals
– New staff teamed with experienced
individuals
CRS
• What is the legislative hook?
• High volume, quick turnaround
– “a reference factory”
• Emphasis on legislative consultation,
interdisciplinary work, & anticipatory work
CRS
• Provision of background papers to the
committee
• Assistance in design of congressional hearings
• Suggestions of witnesses for hearings
• Possible questions for Members to ask
witnesses
• Attend hearings to supplement questions
CRS
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Consultation at mark-ups
Hearing testimony
Consultation on the floor as requested
Prepare conference agendas
Consultation at conferences
CRS
• Most important role may be participation in
creation of new legislation
• Work not available to the public
– Unless released by a Member
CRS
• Varied products
– Electronic briefing books
– Background reports on topics
• CRS staff also interacts with Members and
staff
CRS
• In-house capacity
– Modeling
– Create microsimulation models
– Fiscal analyses
– Culture emphasizes qualitative approaches
and oral tradition
Think Tanks
• Originally, U.S.
– Now world-wide
• Have blended policy outside of political
environment
• Established by interest groups
– Interest groups can adapt models developed
by official sources
Heritage Foundation
• Founded in 1973
– Formulate and promote conservative policies based
on principles of free enterprise, limited government,
individual freedom, traditional Americans values and
strong national defense
• Seeks to differentiate itself from other
conservative think tanks by focusing on
influencing decisions very early in the process
Heritage Foundation
• Established in 1973 with 9 staff
– 1997 staff of 180
• Added research staff in 1980
• Funding from individual sponsors
Heritage Foundation
• Has pushed boundary of tax exempt
organizations
• Replaced the Kennedy School orienting
new conservative congressman
• Focus on Congress --- members and staff
Health Policy
• Peters (1999)
– Pubic policy
• “sum of government activities, whether acting
directly or through agents as it has influence on
the life of citizens”
• Birkland (2001)
– “ a statement by government of what it intends to
do or not do, such as laws regulation, ruling,
decision, or order as a combination of these”
Health Policy
• Cochran and Malone (1995)
– “policitical decisions for implementing
programs to achieve societal goals
• Longest 2002
– “authoritative decisions made in the
legislative, executive, or judicial branches
of government that are intended to direct or
influence the actions, behaviors, or
decisions of others.
Health Policy
• Authoritative
– refers to decisions made in any part of
government
• all three branches
Policy and Health
• When public policies or authoritative
decisions refer to health it is health
policy
• Includes federal, state, and local
government
• Health policy affects classes of citizens
– physicians, providers, consumers, the
poor, the elderly
Health Policy
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Laws
Rules
Regulations
Judicial Decisions
Health Policy
• In the US: Consists of many decisions,
rather than one large decision
• Other countries have integrated,
coordinated health systems (Great Britain,
Canada)
Health Policy
• PL 89-97 1965 law establishing Medicare
• Executive order establishing federally funded
health centers
• Court ruling that an integrated delivery
system’s acquisition of another hospital
violates federal anti-trust
• County health department’s procedure for
inspecting restaurants
• City government’s ordinance banning
smoking in public places
Laws
• Laws enacted at any level of government
create policies
• Laws passed at federal and state levels
– federal laws: 1983 Amendments to the Social
Security Act (P.L. 98-21)
– state laws govern professional practice
Health Policy and Markets
• Capitalist countries such as the USA
assume
– markets are critical to production
– consumption of health services
Health Policy Interventions
– intervention needed when markets fail
– party models have differing tolerance for
market imperfection
Conditions for the Market
• True markets require:
– buyers and sellers have adequate information
to make informed decisions
– large numbers of buyers and sellers
– easy entry to the market
– competitive products that can replace each
other
– adequate quantity of products
Health Policy Categories
• Allocative Policies
– provide net benefits to some at the
expense of others
• subsidies for medical education
• rural hospital support
• Medicare and Medicaid
Health Policy Categories
• Regulatory Policies
– policies designed to influence actions,
behaviors, and decisions of others
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market-entry restrictions
rate or price setting controls
quality controls
market preserving controls
social controls
Health Policy Categories
• Regulatory Policies
– market entry, rate controls, quality controls,
market preserving controls are all economic
regulation
– social controls seek socially desired
outcomes: smoke free workplace,
nondiscriminatory hiring practices
Market-Entry Restrictions
• State licensing laws
• Planning programs
• CON
Price Setting
• Out of vogue
• Electric and gas utility control
• PPS
Quality
• Food safety and quality standards
• Medical Devices Amendments (P.L. 94295) to the Food, Drug and Cosmetic Act
(P.L. 75-717)
– placed medical devices under FDA
Market Preserving
• Health markets are not true markets; this
class of regulatory action addresses
market imperfections
• Sherman Anti-trust laws
State Health Policy
• Dynamic balance between state and
federal policy
• Recent ascendance of state policy
– failed national reform in 1994-1995
– Medicaid growth
State Health Policy Roles
• Lipson (1997)
– financing or paying for several categories of
people
– public health
– regulating health professions licensing and
practice.
State Health Policy Roles
• Financing
– Medicaid
• about 15% of most state budgets
– State employee health benefits (large group
when you consider teachers, employees, etc)
– uninsured
State Health Policy Roles
• Public Health
– oldest most fundamental state health
responsibility
– States granted constitutional authority to
establish laws to protect public’s health and
welfare
• engages states in environmental protection
• Federal government delegates to states
responsibility for monitoring the environment
– monitoring workplace and food safety
State Health Policy Roles
• Professional Regulation
–license various professionals
–write practice acts
–license and monitor compliance
State Health Policy Roles
• States regulate the content, pricing
and marketing of insurance plans
• Under the McCarran-Ferguson Act
(P.L. 79-15)
ERISA 1974
• ERISA preempts state’s regulation of
pensions and self-insured plans
– COBRA 1985 – allows employees to purchase
health coverage for 18 months post employment
– 1996 HIPPA (P.L. 104-191)
• allows employees guaranteed access to health coverage
– company must provide benefits
– premiums can be renewed assuming payment
ERISA
• Enacted to remedy fraud mismanagement
in private-sector employer pension plans
– Includes broad preemptive language
providing for federal law to supercede all state
law
• “relate to employee benefit plans sponsored by
private-sector employers or unions
ERISA
– ERISA has exemptions to preemptions
• Self-insured plans cannot be regulated
• Insured plans can be regulated by states
– ERISA has led to 25 years of court
interpretations
• Courts have noted ERISA is “conspicuous in its
breadth”
ERISA
• 1995 Travelers Insurance decision
– Court limited ERISA’s peremption provisions
• Limited types of state law impacts that “relate to”
private sector employment
• Allowed NY hospital rate setting law to impose
surcharges upon hospital bills paid by insurers and
ERISA plans
– ERISA still prohibits mandating employers
offer benefits
State Laboratories
• State viewed as “health coverage
laboratories”
– ability to implement local solutions to
coverage
• little evidence the laboratories actually
design experiments with national
implications
– 50 individual markets
• all politics are too local
State roles increasing
• States may be too idiosyncratic
• States still face large problems and
increasing problems
Health Policy Policy vs Policy
Objectives
• Policies developed to achieve
someone’s policy directives
• The objectives shape health policy
Current US Health Policy
Objectives
• Adding years and quality to life
• Eliminating disparities in health and
access to health services
• Improving quality of health services
• Reducing cost of health services
Current US Health Policy
Objectives
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Eliminating environmental threats to health
Improving housing and living conditions
Improving economic conditions
Improving nutrition
Moderating consumption of food, drink and
chemicals
• Modifying unsafe sexual practices
Domain of Health Policy
• Remarkably broad
– physical Environment
– biology
– social
– tax issues
Domain of Health Policy
• Personal Responsibility and Work
Opportunity Reconciliation Act (P.L. 104193)
– AKA Welfare Reform Act
• modified welfare eligibility
• also modified Medicaid eligibility for key welfare
benefit
– AFDC
Personal Responsibility and
Work Opportunity
Reconciliation Act (P.L. 104193)
• Replaced AFCD with Temporary
Assistance to Needy Families (TANF)
• TANF provided in state block grants
– states provided broad flexibility to design
support and work programs
• states must impose time limits on support
Personal Responsibility and
Work Opportunity
Reconciliation Act (P.L. 104193)
• Allows AFDIC eligible families to enroll
in Medicaid, but new identification
methods are needed
Political Negotiation
• Involves two or more parties bargaining
– win/win
– competitive -- win/lose
Political Negotiation
• Cooperative Negotiating Strategies Work
best when:
– goal of both negotiators is to attain fair,
specific outcome
– sufficient resources are available
– both negotiators believe they can achieve fair
outcome
Political Negotiation
• Competitive Negotiation works best when:
– each negotiator want to achieve the most possible.
– resources are not sufficient for both negotiators to
achieve their goals.
– both negotiators think it is impossible for both to
succeed.
– the intangible goal of both negotiators is to beat the
other.
Economic Markets vs.
Political Markets
• Health policies– all policy– is made
within political markets
– operate much like traditional markets
• Differ from traditional markets
– no money exchanged
– less direct relationship than traditional
markets
Sellers
(Suppliers)
Economic Exchanges in Market Transactions
Buyers
(Demanders)
Economic Markets vs.
Political Markets
• Demand for health policy markets
– knowledgeable individuals
– organizations
– organized interest groups
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AMA
AARP
AAHP
PhRMA
Benefits of Interest Groups
Ambiguous
• James Madison “The Federalist Papers” in
1788
– described groups he labeled “factions”
– Madison felt factions were inherently bad
– “mischiefs of the factions” must be contained
by setting it against other groups ambitions
Pluralist Perspective
• Everyone’s interests represented in one or
more interest groups
• View interests groups as positive
• Interest groups provide linkages among
people and government
• Interest groups compete for outcomes;
creates counterbalanced vectors
• No group will become too dominant
Pluralist Perspective
• Groups must rely on political power bases
• Groups representing concentrated
economic interests must have money
• Groups representing consumer groups
must have members
Interest Groups
• More than 22,000 in US
– concern with pluralist perspective
• all 22,000 groups given legitimacy
Interest Groups Have Power
• Lowi labeled “interest group liberalism”
– to address excessive deference to interest
groups
• Edwards, Wattenberg & Lineberry, 2001
– Hyperplualism
Interest Groups have Power
• Critics:
– Interest groups too influential
• responding to interest groups creates conflicting
policy
• Government tries to satisfy conflicting groups with
policy satisfying all groups
Elitist
• Models argues those who control key
institutions have power
– act as gatekeepers for public policy process
– take powerful roles in nation’s economic and
social systems thereby overly controlling
policy
Elitist Model
• Real power lies within only a few groups
• Members of the power elite share a consensus
or near consensus on basic values
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private property rights
preeminence of markets
best way to organize
limited government
role of individual liberty
Elitist
• Protect power base
What Must Health Care
Reform Accomplish?
• Restrain cost
• Create access and equity
• Improve quality
• Promote health