Health care reform ideas inspired by Nudge

Jeff Kling of Brookings slips on the cloak of a choice architect to design some innovative health care reforms. Kling makes the case for five nudges for the U.S. health care system.

  • Establishing automatic enrollment is valuable for any type of health insurance coverage expansion, regardless of whether there is an individual mandate
  • Allowing states to augment a national base of health care reforms would enable refinement of various approaches
  • Determining eligibility based on data collected through the tax system, either on tax forms or through data matching, would greatly facilitate automatic enrollment
  • Implementing collections of individual contributions to premiums through the tax withholding system may facilitate continued enrollment and reduce administrative costs
  • Creating a system in which third-parties provide enrollment advice to individuals and are rewarded for their performance may be preferable to legislating how to select a default plan

Figuring out how to simplify the sign-up process for the 47 million Americans without insurance would be one of the biggest challenges facing any new system. Like others who think there is great potential for the government to creatively use tax records, Kling says people might be required to use W4 withholding forms to pick a plan, states might make an initial rough estimate of those eligible for subsidies on the basis of last year’s tax returns, and the IRS might merge data on taxes and immigration status to better determine eligibility. Kling even has an idea for building social norms by creating special accounts for health insurance payments. Private employers providing insurance would deposit money in employees’ accounts, while those without insurance would be required to set aside money each month to pay for certain medical costs or premiums. The goal of these accounts would be to ensure that all Americans, without or without coverage, contribute to the costs of a product that ultimately benefits all of us.

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8 Responses to “Health care reform ideas inspired by Nudge”

  1. Mike Oliphant Says:

    I sit on the board with Utah association of Health underwriters and http://www.BenefitsManager.net as well as http://www.HealthInsuranceSource.net for health insurance reform. Several interesting changes took place with H.B. 188 passage earlier this year that seems all too familiar on the federal level. The spirit of the bill allows private market place remedies. It essentially guarantees insurance providers a “no loss” or “no gain” over competing carriers in the insurance exchange portal which is http://www.UtahInsuranceExchange.info. On the surface it seems not to be attractive to participating carriers (voluntary at this point). But you have to understand the carriers’ goal is to cover their administration fees. That can be accomplished now. The other half of the equation is providers and their billing practices that need to be reformed. That is on the agenda. Keep an eye on Utah because the national health care debate seems much the same ground we have already covered.
    In http://www.UtahInsuranceExchange.info which is the beginning of a state sponsored program addresses issues on a local state level that the federal level might look at. Coming from an underwriting background I know where the dime falls. I am of the opinion that large waste occurs from providers billing for procedures that developed “no outcome”. Insurance carriers are not the only bad guys on the block. In most of our purchasing decisions….don’t we pay ONLY when we know that we will get a desired outcome? Why is it if you ask the doctor how much this test or procedure is he doesn’t know? Shouldn’t providers be held to a transparent cost standard?
    You must be in the health care business from some touch point to make statements of fact in face of historical proposed changes. When you are in the system from any touch point (insurance, provider, hospital, Medicare or patient) you get it because of real time experience.
    I often quote the Switzerland health care system as an example of tough questions that we will have to face at some point down the time line. Did you know that premature babies there are not resuscitate upon birth if they cannot draw breath? Did you also know that is the same with senior care with system failure? They don’t extend life of a senior with multiple failures like intubation as example. Anyone in the business of paying claims knows that single most expensive bill in NICU for newborns and seniors in acute intensive care / hospital.
    These decisions were made based upon cost vs. quality outcome. Are we as a nation prepared to make that type of decision or definition of when to incubate a newborn or a senior? To define the conditions? With a litigious society I think not. This is why we need tort reform. Without tort reform medical provider costs will never drop. Liability costs with medical providers are nearly half of operating expenses. With health insurance carriers it translates to about 10% of every premium dollar collected.
    I don’t think we are hearing about tort reform because most of the house and senate are lawyers. In the healthcare system there is no total innocence. Insurance executives with bonuses, doctors overbilling, hospitals overbilling because the street gang thug got dropped at their door with no insurance.

  2. Anonymous Says:

    How about entitling every American citizen to one annual check-up per year, “on the house”? That way people with health issues that might end up affecting the greater masses are treated early, in turn preventing an outbreak like H1N1 (for example), and of course even if there is no life threatening disease they are more apt to stay healthy in the long run if they see a doctor at least once a year. I think it would promote better health not only on an individual basis but also on a massive level. If you get a “free” visit once a year, wouldn’t you use it? I know I would.

  3. mld678 Says:

    Having access to affordable health care coverage as costs rise, is a key issue for many Americans right now and should be Congress’ top priority. Friends of the U.S. Chamber of Commerce supports alternatives for individual health coverage. Learn more about some of the proposals and sign a petition at http://www.friendsoftheuschamber.com/takeaction/index.cfm?ID=40 .

  4. Janet Brown Says:

    The private sector and competitive market forces, not the federal government, are the best means to meeting our country’s rapidly expanding health care needs. One of the things I think we can do to help make that happen is support American businesses and the U.S. Chamber of Commerce (http://bit.ly/oanAT). They’re doing things to reach out and show people that they can get involved, too.

  5. Michael Says:

    This could seem a little harsh, but i want to toss it out there for somebody to read and respond.
    I believe every person should have access to health care to stay healthy. Though, there are a lot of people who are illegal to the United States and shouldn’t be getting the health care that the rest of us get. My idea is there should be some type of identification given out to every legal American so that when they go to the hospital, or even more the emergency room, they can be allowed access. Anybody who is not a legal American should be turned away. This would do a couple of things:
    A: Help keep the illegal immigrants out of the United States, because if they get sick, they can’t get access to medical. It is harsh, yes, but they don’t pay taxes, so why should we give them a free ride in our hospitals when they don’t pay taxes. All the hospitals do after they can’t afford the illegal immigrant is go to the government, which just takes our money in the first place.
    B: Since the hospitals don’t have to worry about so many illegal immigrants crowding into the emergency room and taking up so much money, the government wouldn’t have to spend so much in medical to the hospitals. So money saved is the second idea

    Let me know about the idea, even though I even agree it’s kinda harsh, but something has to be done. Besides this idea kills to birds with one stone, deterring illegal immigration and a money crisis in the government.

  6. Henry Massingale Says:

    A American Dream,a concept that will touch your mind and its truth for the building block for a HEALTHCARE RFEORM STIMULUS PACKAGE, that has never been conceived within the 21st century of man s thoughts.It will put a smile on your face. The people do not want the system to take care of them, Im sorry but this is true.
    Please visit us on google.com and search for http://www.fascmovement.mysite.com
    or click here
    All we ask is that you PAY IT FORWARD
    Henry Massingale
    561 734 1376

  7. Timothy Durr Says:

    I know this issue has become very complicated of late; I have a few simple ideas’ that would implement reform and allow a public option to allow competition.

    Idea #1; Pass Legislation that restricts insurance providers from excluding the insured for Pre Existing Health conditions. This exclusion allows the insurance provider to charge additional fee’s for the individual purchaser. End this Practice.

    Idea #2; Pass Legislation that OPENS a public option based on the existing Medicare System that anyone can access, by purchasing a Medicare Public plan that works within the Medicare Healthcare and provider network. This system works now and adding individuals that Pay INTO the plan with a monthly fee can only shore up the system. These Public pay-in purchasers would still have there tax deduction withdrawn until retirement but would buy into it until that time. Single Records would be kept until they retire and transition at retirement would be seamless. Additionally those paying into the plan would provide funds into the system that would strengthen the system, most younger people who carry insurance don’t use it as often but would still pay into the system. This system is already functioning and would require very little additional administration to monitor. Win Win for all.
    Math:
    Say 20 Million people buy into the Public Medicare Plan.
    At a Annual fee of $ 4,200.00 that equates to $ 84 Billion.
    Say 25% accrue an average of $ 10,000.00 in Annual medical fee’s,
    That’s a draw down from the $ 84 Billion of $ 50 Billion, leaving
    $ 34 Billion annually to carry down to the bottom line.
    Add more individuals and adjust the Annual fee based on AGE and/or INCOME levels and you can see the Bottom line dollars increase, this increase will strengthen the Medicare Network.

    At a conservative estimate, $ 84 Billion over 10 Years is $ 840 Billion,
    With estimated fee’s and costs at $ 50 Billion, that brings into the plan an estimated $ 340 Billion over 10 Years, likely much higher.
    With the continued TAX revenue that will still be provided by the Public Medicare recipients, there is NO LOSS to the existing senior plan and ONLY an increase of revenue for the system to be even stronger.

    Idea #3; Disconnect the link between the employer based insurance and have it a total individual system that allows you to keep it with you where ever you go, change jobs and no insurance issue.

    Idea #4; For those with limited income issues, they can be provided an income level based Tax credit towards there needed coverage, as there income improves, the TAX credit adjusts.

    Idea #5; The scenario I think, would handle the needs of the self insured and consumer oriented option, looks like this.

    The Self insured, provide such coverage as a way to reduce costs that are carried down too the bottom line. With a more competitive market offering multiple choices in addition to an established Medicare Public option, these costs should be greatly reduced as the self insured employers are now at a level with the more competitive market.

    Idea #6; If a hospital provides its employees an internal health coverage plan in addition to the outside offerings, then this too would be a factor in the reduction of insurance coverage. The hospital based self insurance plans could also offer participation in the open market and offer there plans too the public market and thus increase a positive carried to the bottom line.

    With so many people obtaining insurance as an individual or head of household family method, the advantages now seen with the current Group Employer system would carry into a much larger Individual Group System.

    The stress of having to change ones coverage every time you change your job, ways heavy and this stress in its self is a health risk.

    Timothy J Durr
    America Citizen
    October 2009

  8. Henry Massingale Says:

    Federal Act Security Card

    The Federal Act Security within its creation is to form a building block of ideas that state that we do not say have faith in us but to have faith in yourself. To reach into your mind and say what could I do as a person to build on to this concept to protect it, to make it a law.

    As a people you have become divided by issues, and it is because of what took place on September 11 2001. This Country has become weak within its inter-structure. As the years went by it is now that only about 125 million people support the rest of the USA.
    The sales tax and has dropped off to around 34% of income and the lost tax revenue has placed us into a fix and it is just now known that this tax dollar issue should not be public.

    Understand this there is a people who wish for us to die because we are infidels. This is so disturbing to our minds that we we reach out to God and say how is this ?
    I was not born to follow and I am not a leader, but within my world that is The United Tribes Of Many Nations we stand over 500 000 strong  and for most we harbor no ill will. We wish to say that this Country that this land belongs to God and it is said for as long as the grass grows and the water flows that this land will be our, { The People OF The United States Of America.}

    That, for of the Arabic drug empire we say this,” that God is within this country and we will not lay down and die.”

    Some have said that the enemy could of not known that their attack on 9/11 could all most bring down a Country, perhaps so, but they know now, because it was felt all over the world.

    This is how we saw into the concept of the Federal Act Security Card merged with what we call ,a Health Care Reform Stimulus Package. The inter facing of the two will build a security on two fronts first and ut most important the people 2nd., It will build a net work that in it concept is a anti crime / war prevention forum to maintain the National Security Of The United States Of America.

    A Health Care Program must be a united effort that says, that in the early days it was created for the better good of mankind, but now it is a way to make money off of the old ,the sick and the dieing.

    It must also be known that this concept is protected from what is called A.I, the artificial intelligence within the computer systems that run our Government Institution. A.I. Has failed because it built its concept on a dollar being constant. This computer it dose not live, it dont know how to love, all it dose is calculate.” Now it shows system failure” , and it looks back to man to help fix its failure.
    The FASC Concepts is for one thing only, us.

    It dose not matter if you don t believe in God, or what race you are, or if you are Christian ,Jew
    or what country you live in, There is a Drug Empire that want you yo die and your children to die. The Arabic Drug Empire seeks to unite with others and I say to you, that they will betray you and sacrifice you for their goal. We call for a International Boy Cott Against The Arabic Drug Empire. For they seek biological tactics of death. Billions of people will die while they sit in their cave and wait for it to run its course.

    As of now they build a weapon that is considered to be out dated because technology has advanced
    to where the use of atomic weapon is genocide and if we do not intervene every last man,woman and child in Iran will die and this will mark us and our children for decades to come.

    Now you can take the RED PILL and wake up and think its just another day, or
    you can take the BLUE PILL and we will show you how deep the rabbet hole is.

    This all we wish to say for now. so go ahead and omitted the search and see how deep………..
    Henry Massingale

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