• Is Gail Wilensky for competitive bidding?

    I highly recommend listening to the On Point discussion about Rep. Ryan’s budget proposal with guests Gail Wilensky and Jon Oberlander. The former represents the right-of-center position, the latter the left-of-center one. Both are deeply¬†knowledgeable about Medicare, Medicaid, and our health system in general.

    Oberlander is a political scientist at the University of North Carolina (Chapel Hill), a nationally-recognized expert on health policy, and has¬†published in top health policy journals. I’ve discussed some of his work on this blog.

    Wilensky is an economist and senior fellow at Project Hope, an international health education foundation. She directed the Medicare and Medicaid programs under President George H.W. Bush, was a health care policy adviser to John McCain’s 2008 presidential campaign, and the first chair of Medicare Payment Advisory Commission.

    On the program, Oberlander rejects Rep. Ryan’s proposal for Medicare and Medicaid as irresponsible, immoral, and politically doomed. Constructively, he raises the difficult issues associated with the proposal. The evidence shows there is a cost in health to less generous insurance, particularly for vulnerable¬†populations¬†enrolled in public programs. This point should not be overlooked. We can spend less, but there are consequences.

    Wilensky offers a qualified endorsement of Rep. Ryan’s plan. However, her qualifications are interesting and in some respects align with the concerns of Oberlander. For example, both would prefer to see Medicare retain its “public option,” the government-run traditional arm of the program.

    Wilensky also seems to endorse competitive bidding in Medicare, which, as I’ve written, would establish the subsidy level for private and public plans based on bids rather than based on an administrative pricing formula. Her comfort with competitive bidding is revealed in a subtle statement on the program — one easy to miss — that she would like to see premium support levels be such that they would keep up with the cost of the least expensive plan (Rep. Ryan’s proposal would not). If that’s not competitive bidding, I don’t know what is.

    Wilensky also speaks favorably about Medicare Part D, the prescription drug program. She points out how much cheaper it is than predicted. Again, one reason for that record on cost control is that subsidies are set competitively, based on plan bids. They’re set based on the average, not the minimum, but that’s a variant of competitive bidding (anything that relates one plan’s subsidy to bids of other plans in a way that encourages efficiency is a flavor of competitive bidding).

    Perhaps Wilensky has supported competitive bidding with a public option in the past. I don’t know. I’m not a scholar of her work or public statements. Nevertheless, she certainly seems to support it today.

    The discussion is worth a listen. Check it out.

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