Wednesday, April 30, 2008

McCain unveils health care plan

McCain's proposal calls for:
  1. ending the link between employment and health insurance
  2. paying providers for outcomes, rather than procedures
  3. allowing drug reimportation
  1. If consumers have to shop for insurance directly, rather than with other people's money, they will choose cheaper plans with bigger co-payments, which would likely reduce price inflation. UPDATE: evidence here.
  2. If we can measure performance, then this would reduce moral hazard by linking pay more closely to performance; and
  3. This would likely end price discrimination. The big losers will be foreign countries, e.g., Africa, that currently buy drugs very cheaply.
DISCLAIMER: I am supporting McCain

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