Editor's Notes: The PPI "Health Policy Wire" is an email newsletter published by PPI's Health Priorities Project. To sign up for a free subscription, click here. (Just make sure to check the box next to "Health Care.") Original links are included though some may have expired.
1.) Giuliani Health Plan Embraces Darwinism?
2.) The Obesity Bug
3.) Bold Badgers
Conservatives may be reluctant to embrace Darwinism, but not when it comes to health care. The leading Republican presidential candidate Rudolph Giuliani's new health care plan is survival of the fittest.
The central feature of Giuliani's plan is a new tax deduction for Americans to buy health insurance on their own in an open market. It would give taxpayers up to $7,500 for individuals and $15,000 for families. It tracks closely with what President Bush proposed in his State of the Union address.
A conversation about the Giuliani plan has begun at Ideasprimary.com, a new website devoted to a discussion of ideas and national priorities during the presidential primaries. It also features Tennessee Gov. Phil Bredesen (D) discussing his state's innovative Cover Tennessee program.
On Giuliani's plan, PPI's David Kendall writes:
Wide open markets make sense for most consumer goods and services, but in health care, markets are seldom compassionate. A child born with a genetic disease like cystic fibrosis will never be able to buy health insurance coverage. A person who develops a chronic disease like diabetes might be able to purchase a plan, but insurance companies often won't cover the costs of treating an existing disease. A healthy person who buys coverage may lose it when an insurance company, looking to widen its profit margin, drop whole groups of subscribers whom executives fear will get sicker over time and file too many claims.
So what would Giuliani do? In short, he would unleash what wonks like me call "the death spiral in insurance." He would create an incentive for healthy workers to leave the insurance pools they join through their employer, and purchase insurance at a lower cost on the open market. That would leave sicker workers -- who might be unable to find coverage without the help of their employer -- as the only subscribers to their workplace health plan. And in turn insurers, worried that they would only be insuring workers who would demand a great deal of expensive care, would drive up premiums, eventually forcing employers to stop offering coverage all together.
Another flaw with the Giuliani plan is the way it caters to well-off Americans who can already afford health care coverage. As Kendall explains: "The tax deduction would be worth more to people in higher income tax brackets whose marginal tax rates are much steeper than those at the lower end of the income spectrum. Although Giuliani would provide some additional tax relief for low income workers, he could do much more for low and moderate income voters if he weren't doing as much for the wealthy."
Clearly, the nation can do better than a health plan that gives the rich more tax breaks and raises costs for the sick.
"Giuliani's Darwinian Health Care Proposal,"
by David B. Kendall, Ideasprimary.com, August 2, 2007:
http://www.ideasprimary.com/?p=247
"Twelve Commitments: Health Care,"
Rudy Giuliani Presidential Committee, Inc:
http://www.joinrudy2008.com/commitment.php?num=7
Obesity is the nation's fastest-growing epidemic, but no one knows quite why. New research shows obesity spreads from person to person like the flu bug. Scientists have found that people with obese family members, spouses, or friends have a significantly greater risk for obesity. The conclusion is that obesity spreads socially, challenging the notion that body weight is solely a function of genetics and personal habits.
Nickolas A. Christakis of Harvard Medical School, the study's main investigator, says the research team "wanted to see if [obesity] really did spread from person to person like a fashion or a germ." And the answer was, "Yes, it does."
The study found that if a person's spouse gains weight, he or she has a 37 percent higher chance of becoming obese in the next two to four years. The risk is 40 percent higher for someone whose brother or sister has recently gained weight. The increase in risk is even sharper among friends. Close friends of the same sex are almost twice as likely to become obese if one friend becomes obese. Unlike an infectious disease, however, it does not matter if people live close together. "We were stunned to find that people who were hundreds of miles away had just as much impact on a person's weight status as friends who are next door," says Christakis. "This is not due to people eating or exercising together."
The study suggests that when a person becomes obese, it becomes more socially acceptable for others close to him or her to gain weight as well. Social contact with an obese person may increase one's tolerance for being obese, promote adoption of weight-gaining behaviors, or both. "People are more likely to copy the actions of people they resemble," explains Christakis. "What we think is going on here is emulation."
The phenomenon also works in the opposite direction -- if your friend, family member, or spouse loses weight, than you are more likely to do so as well. Many Americans testify to the value of social support when dieting. Take Maggie and Andy Sorrels for one, a newlywed couple who battled lifelong struggles with weight gain and emotional eating. According to a CNN report, both felt completely isolated in their youth, battling depression and anxiety underneath their ostensive happiness. After trying countless diets and weight-loss programs on their own, together they entered a faith-based program and lost a combined weight of almost 600 pounds. With the support of each other and the social network provided by their weight-loss program, they were able to slim down, find happiness, and start a family. The Harvard study provides a scientific basis for the immense value that the Sorrels and others see in social support for weight management.
The idea that obesity spreads socially similar to an infectious disease has important implications for its control. Infectious diseases, unlike their chronic counterparts, can be eradicated by widespread vaccination and health education. Using these strategies, public health authorities have seen successes against infectious diseases like polio and have nearly eradicated measles over the past few decades. With further research, the government could develop an obesity "vaccination" strategy that seeks to reinforce social networks. It could be a strategic alternative to the ad hoc array of public health messages about personal responsibility for weight gain, expensive stomach-reducing surgeries, and the stunning array of fad diets and weight-loss meal replacements that are widely available.
Scientists must work to discover what might comprise a potential "vaccine" for obesity. It may include the provision of incentives for work environments to have healthy social outlets and on-site group weight-loss activities. It might increase funding for recreational sports teams, encourage after-school programs to incorporate physical activity and prevent healthy social norms, and promote "mall-walkers" or other communal recreational activities. Scientists might also do well to study the popular weight-loss facility Curves, which provides over 4 million women a place to meet, socialize, and exercise in a comfortable and supportive environment.
Given the high costs of obesity, an obesity vaccine should be a high priority.
"The Spread of Obesity in a Large Social Network over 32 Years,"
By Nicholas A. Christakis and James H. Fowler, NEJM, July 26, 2007:
http://content.nejm.org/cgi/reprint/357/4/370.pdf
"Study Shows Obesity Can Spread Through Friends and Family,"
By Rob Stein, Washington Post, July 25, 2007:
http://www.washingtonpost.com/wp-dyn/content/
article/2007/07/25/AR2007072501353.html
"Incredible Shrinking Couple Loses 580 Pounds,"
By Jacqueline Adams, CNN, July 23, 2006:
http://www.cnn.com/2007/HEALTH/diet.fitness/
07/23/weightloss.sorrells/index.html
The Wisconsin Senate has approved a plan to cover the state's uninsured residents and lower health care costs for everyone. Called "Healthy Wisconsin: Your Plan, Your Choice," it is based on the principle of public financing for private coverage. It would offer everyone a choice of health plans similar to the Federal Employees Health Benefits program, which covers federal workers and members of Congress. It is financed by a payroll tax.
Although this legislation seems to have come out of nowhere, it is a very serious effort based on decades on health policy work as well as Wisconsin long-standing commitment to health care with such novel programs as BadgerCare. David Riemer, a long time friend of PPI and Director of the Wisconsin Health Project, has worked closely with Stanford University Professor Emeritus Alain Enthoven, to fashion a proposal based on the managed competition theory for health care reform. The Wisconsin bill would enable consumers to choose among competing health plans. Consumers would receive a credit or voucher equal to the cost of a low-priced plan. They would pay the full additional cost of a more expensive plan. This economic incentive for cost control would be much stronger than under today's job-based coverage regime. The current federal tax break for job-based health insurance gives employees a 30 percent discount or more off expensive health plans because employee's and employer's health insurance premiums are not subject to income or payroll taxes, unlike wages.
Those who have been following the health care debate for many years may see the Wisconsin plan as a throwback to the 1994 debate. But in fact, the Wisconsin plan does not call for the price controls included in President Clinton's version of managed competition. In fact, the managed competition theory has never received a full-blown market test. If nothing else, the Wisconsin plan would give the nation a chance to see how well it works.
The big obstacle to enactment of the Wisconsin plan is the payroll tax. There's no way to soft pedal it. Employees would pay 4 percent of their paycheck (up to the Social Security tax threshold of $97,000). Employers would pay between 9 percent and 12 percent of their aggregate Social Security wages, depending on the firm's size. As high as these amounts seem, they would be slightly less than what employers and employees pay on average today according to an analysis by the Lewin Group. The savings from the reforms are used to finance coverage for the uninsured and to provide property tax relief.
The payroll tax has already been attacked by The Wall Street Journal as a job killer. But the only businesses that will pay more for health care will be those who are not paying for it today. And regardless of how much employers are required to pay on paper, economist have made it clear the payroll taxes ultimately come out of employee's total compensation. Whether through an individual mandate with sliding scale subsidies in Massachusetts or a payroll tax in Wisconsin, there's no avoiding the need to finance coverage for the uninsured.
The WSJ also raises the specter of government rationing under the Wisconsin plan. This argument is simply fear mongering because the Wisconsin plan is clearly market based. In fact, an earlier version of the bill included the favorite reform of conservatives: health savings accounts and a high-deductible health plan. Perhaps if the Wisconsin Assembly gets serious about reform, they could reinstate them.
The Wisconsin effort bears watching as a test case for health care reform. Like similar efforts in many other states, it sends a clear message that health care needs dramatic action.
"Wisconsin's Near-Universal Coverage Bill Spurs Debate,"
Kaiser Daily Health Policy Report, July 24, 2007:
http://www.kaisernetwork.org/daily_reports/
health2008dr.cfm?DR_ID=46449
The Wisconsin Health Project:
http://www.wisconsinhealthproject.org/
"The Wisconsin Health Plan (WHP): Estimated Cost and Coverage Impacts,"
By John Sheils, The Lewin Group, June, 2007:
http://www.lewin.com/NR/rdonlyres/938542F6-25F3
-4607-AC8F-8970AF20731F/0/WisconsinHealthPlanRpt.pdf
"Cheese Headcases: Wisconsin reveals the cost of "universal" health care,"
The Wall Street Journal, July 24, 2007:
http://www.opinionjournal.com/editorial/feature.html?id=110010374
