We study the trade-off between bureaucratic costs and reductions in moral hazard induced by managed care tools in healthcare…. Prior authorization reduces a drug’s utilization by 26.8%. Half of marginal beneficiaries are diverted to another related drug, while the other half are diverted to no drug. These policies reduced drug spending by $96 per beneficiary-year (3.6% of drug spending), while generating approximately $10 in paperwork costs. Revealed preference approaches suggest that the net cost savings exceed beneficiaries’ willingness to pay for foregone drugs.
Category: Health Economics & Costs
Wednesday Links
- The future of telehealth: Just 6% of U.S. adults said they prefer a virtual-only care model. But 35% of consumers prefer a hybrid approach.
- The gender occupational fatal injuries gap: Should the government act to correct this?
- Biden administration air conditioner regs make purchase and repair more expensive – putting home owners and workers at greater risk during heat waves.
- Lack of DEI in opioid treatment: White adults were 14 times more likely to receive medicine than Black adults. Men had 6 times the likelihood as women.
Anything the government operates or subsidizes has exploding costs
Anything the government operates or subsidizes has exploding costs. So health care and education are the components of the economy with the steepest rise in prices over the last 25 years. Education is 75% run by the government and health care is 50% government.
Tuesday Links
- Last week’s most disturbing headline: “Former Gov. Andrew Cuomo’s health director hired by CDC.”
- Contributing to the infant formula shortage: over-regulation, restrictive trade barriers and ridiculous welfare rules.
- The time cost of care may be greater than the money cost of care, and may make care not worth it.
- Why ChatGPT could make bioterrorism a lot easier.
- The downside of personalized medicine: Patients can face the agonizing decision to forgo treatment or suffer financial ruin. (NYT)