• The policy impact of health economics

    In a well-referenced paper, Sherry Glied and Erin Miller summarized the history of health economics research and its policy impact, with emphasis in the second half on the Affordable Care Act.

    The tl;dr version is that the Congressional Budget Office’s bill scoring role is the institutional mechanism by which health economics research affects policy. Without it, it’s not evident how health econ would matter. Not mentioned by Glied and Miller, is that the Office of Management and Budget’s evidence-based budgeting initiative is another mechanism by which health economics, as well as other social policy research, could affect policy. Glied and Miller’s unstated implication (or, my own inference) is that without a fairly explicit institutional role for research—like CBO’s bill scoring or OMB’s evidence based budgeting—it won’t reliably affect policy. All the stomping up and down about how research should inform policy won’t do much. It has to be institutionalized. Exceptions are possible, but rare.

    One passage from the paper, about the ACA’s Cadillac (excise) tax:

    As President Obama and Congress began debating health care reform in 2009, 32 prominent health economists sent the President a letter stating, “This provision offers the most promising approach to reducing private-sector health care costs while also giving a much needed raise to the tens of millions of Americans who receive insurance through their employers” (Rampell, 2009). The excise tax incorporated in the ACA directly addressed the tax treatment of health insurance. The new tax had no political constituency whatsoever—not unions, not business, not conservative taxpayers, not liberal taxpayers. It was a victory only for health economists.

    The victory is both fragile and partial. The Cadillac tax isn’t yet implemented (still 2.5 years to go), it could still be repealed, and its design is imperfect, even ham-handed, for political reasons. But, w00t, health econ!

    The paper is interesting throughout.

    Related, this interview of Daniel Hausman by Gary Gutting on the limitations of economics is also worth your time.

    @afrakt

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