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Volume 6, Number 28
October 30, 2009


In the Spotlight

The Adverse-Selection Problem
Current Democratic health-care proposals will have unintended consequences—bad ones

Scott Harrington, Medical Progress Today, 10-30-09

As the Senate prepares to consider health-care reform legislation, a key policy issue remains unsolved: how to prevent what industry insiders call "adverse selection." The bills under consideration, including the one that the Senate Finance Committee recently approved, would impose major restrictions on insurance companies—forcing them to cover anyone, regardless of preexisting health conditions; barring them from setting premiums based on policyholders' health; and limiting how much they could increase premiums because of policyholders' age. These restrictions would lead to a disproportionate number of older, sicker people buying coverage, while the young and healthy delayed buying it until they needed it. That, in turn, would drive up the cost of insurance and threaten one of the legislation's key goals: reducing the number of uninsured. And pricier insurance would doubtless lead to pressure for still more government intervention.
Continue reading . . .


· Medical Device Recalls and the FDA Approval Process, Zuckerman, D. M., Brown, P., Nissen, S. E., Archives of Internal Medicine, 6-14-11
· Patent Reform Gets Key Support in House, Julian Pecquet, The Hill, 6-14-11
· $4.3 Billion Pledged at Vaccine Fund-Raiser, Donald G. McNeil Jr., New York Times, 6-13-2011
· Physicians Leaving Practices for health System Employment, Karen Cheung, FierceHealthcare, 6-13-11

More Headlines >>


· Marco Rubio takes on 'Medi-scare' Marc A. Thiessen, Washington Post, 6-13-11
· 'Vouchercare' Is the Right Name for Medicare Laurence Kotlikoff, Bloomberg, 6-15-11
· Built To Fail: Health Insurance Exchanges Under The Affordable Care Act
· Can Exchanges Help Consumers Get Good Value Insurance? Depends On Where You Live Sabrina Corlette, Kaiser Health News, 6-15-11
· The ObamaCare Bad News Continues Karl Rove, Wall Street Journal, 6-16-11
· ObamaCare's Economic Flaws Doug Holtz-Eakin, Investor's Business Daily, 6-8-11

More Commentary >>


· Why States Are So Miffed about Medicaid — Economics, Politics, and the "Woodwork Effect", Benjamin D. Sommers et al., New England Journal of Medicine, 6-15-11
· Auditing Access to Specialty Care for Children with Public Insurance, Joanna bisgaier et al., New England Journal of Medicine, 6-16-11
· Moving Beyond Fee-For-Service: The Case for Managed Care in Medicaid, Michael Ramlet and Carey Lafferty, American Action Forum, 6-14-11
· The New Gold Rush: Prospectors are Hoping to Mine Opportunities in the Healthcare Industry, Health Research Institute, PricewatershouseCoopers, 6-14-11
· Active Purchasing for Health Insurance Exchanges: An Analysis of Options, Sabrina Corlette and JoAnn Volk, RWJF, 6-14-11

More Research>>

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The Adverse-Selection Problem

The Manhattan Institute released a new report coauthored by Frank Lichtenberg, Columbia University economist, and Gautier Duflos, University of Paris I, Sorbonne economist. The report examines the impact of the expiration of drug patents on U.S. drug prices, marketing, and the quantity of drugs consumed.
New Manhattan Institute report on drug patents,, 10-28-09 (This is linked on and was originally posted on, 10-28-09)
Listen to Paul Howard interview Frank Lichtenberg about his new report

On Tuesday, October 13, 2009 the Manhattan Institute's Center for Legal Policy, released Trial Lawyers Inc. Update: Healthcare. This report examines the detrimental effect health related litigation has on healthcare costs and defensive medicine practices.

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