Reflex: August 17, 2011

Our daily response to some health-related items in the news.

Medicare reform: Obama vs. Ryan: Daniel Kessler and John Taylor argue in the WSJ that Ryan’s plan for Medicare is a better way forward than what Obama has proposed. In it they liken Ryan’s voucher plan to Medicare Part D and say that its advantages stem from a reliance on market prices. Comment: Actually, Ryan’s plan is not market-based enough in that it sets vouchers using an administrative, rather than a competitive process, as Part D does. Additionally, market-based need not preclude a public option (like FFS Medicare), which gets lower prices relative to plans in some areas due to market failures, chiefly high provider market power. 

What if the mandate goes?: Matt Dobias of Politico warns that premiums would rise due to adverse selection. Comment: True, but only if nothing replaces the mandate. There are other options.

Perry urges Americans to take “personal responsibility” on health care, taxes: Stephanie Condon of CBS reports that Rick Perry prefers Americans have more “skin in the game,” to take on more of the cost of health care. Comment: A concern is that individuals can’t distinguish between effective and ineffective care. They will cut back indiscriminately. Lower income individuals will cut back much more.

(h/t Igor Volsky for flagging some of these stories.)

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