Sponsored by the

Sep. 14, 2007 Half-day Symposium

Click here to see video from the event!

A national movement is building at the state level for health care reform. Many proposals contain elements that would require employers to provide health insurance to workers or pay a fine that would compensate the state for medical costs paid for the uninsured. Such “pay or play” proposals were introduced in 28 states during 2006; 19 states considered similar legislation in 2005. None of these proposals has successfully weathered the legislative and judicial process, except for a Massachusetts bill which contains a "pay or play" component that will go into effect this year.

Questions remain, however, about the economic consequences of these “pay or play” proposals. Cornell University has invited a distinguished group of economists and policy analysts to contribute to a public policy discussion of the intended and unintended consequences of these mandates.

The halfday symposium will take place in Washington DC, September 14, 2007 from 1-5 PM under the auspices of Cornell University and sponsored by The Employment Policies Institute. The event is currently available here.

Moderator:	Dr. Katherine Baicker, Harvard University
Presenters:	Dr. Jonathan Gruber, Massachusetts Institute of Technology (MIT) Massachusetts Health Care Reform: The View from One Year Out (View abstract)(Download full paper PDF) Massachusetts Health Care Reform: The View from One Year Out (Abstract) There had been no serious national attempt at universal coverage since the Clinton Health Security Act in 1994. All of this has changed over the past year. The changes have mostly occurred at the state level, with a large number of states proposing dramatic new interventions to cover the uninsured. Most notable has been the health reform plan enacted by Massachusetts in April, 2006, which recently celebrated its first year anniversary. This sweeping bill reformed insurance markets, subsidized insurance coverage for a large swath of the population, introduced a new purchasing mechanism (the “Connector”) and mandated insurance coverage for almost all citizens. The success to date of the effort in Massachusetts has led to similar proposals in a number of states, most notably by Governor Arnold Schwarzenegger in California. In this paper, I review the history of health reform in Massachusetts, highlighting the unique features which came together to make reform a reality in this state. I then turn to a discussion of the major issues that have been faced in the first year of implementing this reform, and the compromises made to maintain a broad consensus of support in the state. I then discuss the lessons learned and contrast the Massachusetts approach with alternatives, mostly notably plans that rely more strongly on the employer-based insurance system to expand insurance coverage in the U.S.
	Dr. Helen Levy, University of Michigan, Dr. Katherine Baicker, Harvard University Employer Health Insurance Mandates and the Risk of Unemployment (View abstract)(Download full paper PDF) Employer Health Insurance Mandates and the Risk of Unemployment (Abstract) In the absence of any likely Federal action on universal health insurance in the near future, states have taken the lead on this issue by enacting or considering laws that require employers to provide health insurance for their employees. The proponents of these measures make the case that they will increase insurance coverage while maintaining the role of the market in generating competition and efficiency in health insurance offerings. Opponents raise the concern that low-income workers will see offsetting reductions in their wages and that, in the presence of minimum wage laws, some of the lowest wage workers will become unemployed. Academics and the popular press alike cite increased health insurance costs as one of the causes of recent increases in unemployment. There is substantial evidence that the cost of health insurance mandates will be shifted to employees, resulting in lower wages. However, some workers not currently covered by employer-sponsored insurance are so close to the minimum wage that their wages cannot be lowered enough to offset the cost of the new mandate. This paper provides an estimate of how big the pool of workers at risk of unemployment is likely to be and what characteristics they are likely to have, taking into account minimum wage laws and patterns of employer health insurance offering and coverage.
	Dr. Richard Burkhauser and Dr. Kosali Simon, Cornell University Who Gets What From Employer "Pay or Play" Mandates (View abstract)(Download full paper PDF) Who Gets What From Employer "Pay or Play" Mandates (Abstract) Critics of "pay or play" mandates, which require firms to either provide appropriate health insurance for their employees or pay a flat per hour tax, borrow from the large empirical minimum wage literature to argue that their unintended consequence will be to reduce employment (Baicker and Levy, 2005, Yelowitz 2006). Borrowing from a smaller empirical minimum wage literature, we argue that in addition to reducing their employment, a "pay or play" mandate is a blunt instrument for funding health insurance for the working poor. The vast majority of beneficiaries of currently proposed "pay or play" mandates live in families with incomes twice the poverty line or more and, depending on how coverage is determined, a significant share of the working poor will not be eligible for such benefits either because their hourly wage rate is too high or they work for smaller exempt firms.
Discussants:	Dr. Jared Bernstein, Economic Policy Institute
	Dr. Linda Blumberg, The Urban Institute
	Dr. Elise Gould, Economic Policy Institute
	Dr. Mark Pauly, University of Pennsylvania

Dr. Katherine Baicker

Dr. Katherine Baicker was nominated by President Bush on September 22, 2005 and confirmed by the Senate on November 4, 2005 to serve as a Member of the Council of Economic Advisers.

Katherine Baicker received her BA in economics from Yale in 1993, and her PhD in economics from Harvard in 1998. She is an associate professor in the department of public policy at the School of Public Affairs at UCLA, and a research associate at the National Bureau of Economic Research in the public economics program. From 2001-2002 Dr. Baicker served as a senior economist at the Council of Economic Advisers. Her research areas include health economics, welfare, and public finance, with a particular focus on the financing of health insurance, spending on public programs, and fiscal federalism.

Dr. Baicker’s research has been published in the American Economic Review, the Journal of Public Economics, the Review of Economics and Statistics, and Health Affairs. She has served on the faculty of the Economics Department at Dartmouth College, the Center for the Evaluative Clinical Sciences and the Department of Community and Family Medicine at Dartmouth Medical School, and in the Harris School of Public Policy at the University of Chicago. Dr. Baicker’s research has been featured in the New York Times, the Wall Street Journal, Business Week, and on National Public Radio, and has been funded in part by the National Institutes of Health.

Dr. Jonathan Gruber

Dr. Jonathan Gruber is a Professor of Economics at the Massachusetts Institute of Technology, where he has taught since 1992. He is also the Director of the Program on Children at the National Bureau of Economic Research, where he is a Research Associate. He is a co-editor of the Journal of Public Economics, and an Associate Editor of the Journal of Health Economics.

Dr. Gruber received his B.S. in Economics from MIT, and his Ph.D. in Economics from Harvard.  He has received an Alfred P. Sloan Foundation Research Fellowship, a FIRST award from the National Institute on Aging, and the Kenneth Arrow Award for the Best Paper in Health Economics in 1994. He was also one of 15 scientists nationwide to receive the Presidential Faculty Fellow Award from the National Science Foundation in 1995.  During the 1997-1998 academic year, Dr. Gruber was on leave as Deputy Assistant Secretary for Economic Policy at the Treasury Department. Dr. Gruber was elected to the Institute of Medicine in 2005, and in 2006 he received the American Society of Health Economists Inaugural Medal for the best health economist in the nation aged 40 and under. In 2006 he was appointed to the board of the Massachusetts Insurance Connector, the main implementing body for the state’s ambitious health care reform effort, and was named the 19th most powerful person in health care in the United States by Modern Healthcare Magazine.

Dr. Gruber's research focuses on the areas of public finance and health economics. He has published more than 100 research articles, has edited four research volumes, and is the author of Public Finance and Public Policy, a leading undergraduate text.

Dr. Helen Levy

Dr. Helen G. Levy came to the University of Michigan as a Visiting Scholar for the National Poverty Center at the Gerald Ford School of Public Policy in Winter 2004. Dr. Levy recently joined the Department of Health Management and Policy as Assistant Research Scientist for the Economic Research Initiative on the Uninsured (ERIU).

From 2000 to 2004, Dr. Levy was an Assistant Professor in the Irving B. Harris Graduate School of Public Policy Studies at the University of Chicago. From 1998 to 2000, she was a Robert Wood Johnson Foundation Scholar in Health Policy Research at the University of California at Berkeley. She has served as a research analyst for the Robert Wood Johnson Foundation and is a faculty research fellow of the National Bureau of Economic Research.

Dr. Richard V. Burkhauser

Richard V. Burkhauser is the Sarah Gibson Blanding Professor of Public Policy in the Department of Policy Analysis and Management, Cornell University. His professional career has focused on how public policies affect the economic behavior and well-being of vulnerable populations, e.g., older persons, people with disabilities, low-skilled workers. He has published widely on these topics in journals of demography, economics, gerontology, as well as public policy. As Co-Principal Investigator of the Center for Economic Research on Employment Policy for Persons with Disabilities and the Co-Principal Investigator of the Center on Disability Demographics and Statistics, he has carried out an extensive program of technical assistance and presentations to government agencies, policymakers, and consumers on the employment and economic well-being of people with disabilities. He was a U.S. Senate appointed member of the Ticket to Work/Work Incentives Improvement Act Advisory Panel (2000-2002), a member of the 2003 Technical Panel on Assumptions and Methods of the Social Security Actuaries (2002-2003), and a member of the Social Security Advisory Board Panel on a New Definition of Eligibility for Disability Benefits (2006). He received his Ph.D. in Economics from the University of Chicago.

Dr. Kosali Simon

Kosali Simon is an Assistant Professor in the Department of Policy Analysis and Management at Cornell University. Her main research interest is the economics of private and public health insurance policy. A secondary research focus is the determinants of health and health care use. She is a Faculty Research Fellow of the National Bureau of Economic Research and is the 2007 recipient of the John D. Thompson Prize for Young Investigators from the Association of University Programs in Health Administration (AUPHA). Her research appears in American Economic Review (Papers and Proceedings), Health Services Research, Industrial Labor Relations Review, Inquiry, Journal of Health Economics, Journal of Human Resources, Journal of Public Economics, Southern Journal of Economics, and others. Kosali received her PhD in Economics from the University of Maryland at College Park.

Dr. Jared Bernstein

Jared Bernstein joined the Economic Policy Institute in 1992. He is the author of the new book, "All Together Now: Common Sense for a Fair Economy." His areas of research include income inequality and mobility, trends in employment and earnings, low-wage labor markets and poverty, international comparisons, and the analysis of federal and state economic policies. Between 1995 and 1996, he held the post of deputy chief economist at the U.S. Department of Labor. He is the co-author of eight editions of the book The State of Working America and has published extensively in popular and academic venues, including The New York Times, Washington Post, American Prospect, and Research in Economics and Statistics.

Dr. Linda Blumberg

Linda J. Blumberg, Ph.D. is an economist and principal research associate at The Urban Institute. She has been at the Urban Institute since 1992.  For most of 2006 she was in New Zealand as an Ian Axford Fellow in Public Policy, where she studied the effect of having private health insurance on the use of public health services in New Zealand.  Her other recent work includes a variety of projects related to private health insurance and health care financing:  setting standards of affordability for insurance coverage, building a roadmap to universal coverage in the state of Massachusetts, developing options for expanding insurance coverage to high cost/high risk individuals, the effects of the implementation of SCHIP on the insurance coverage of children, and estimating the coverage and risk pool impacts of tax credit proposals.  She was the principal investigator in the development of the Health Insurance Reform Simulation Model (HIRSM), an individual and employer level model which was used to simulate the effects of reforms affecting private and public insurance.  Recent work involved using HIRSM to simulate the effects of various insurance reforms, including tax credits, public program expansions, individual mandates, and employer mandates.  She has also served as a senior advisor in the development of the new Health Insurance Proposal Simulation Model (HIPSM).  She is currently working on analyses of the pending health care reforms in Massachusetts, a study of health insurance issues of workers with disabilities, and mechanisms for counteracting adverse selection issues when expanding insurance coverage to all children.

From August 1993 through October 1994 she served as health policy advisor to the Clinton Administration during its initial health care reform effort.  First at the Department of Health and Human Services and then at the Office of Management and Budget, she was a coordinator of the quantitative modeling effort through the final stages of development of the Health Security Act, and then through the development of alternative policies with Congress.  She worked pro-actively with White House officials, members of Congress and their staffs.

Dr. Elise Gould

Elise Gould has been an economist at the Economic Policy Institute since 2003.  Her research includes labor market trends and health-related economic issues, with a focus on employer-provided health insurance.  Her work has appeared in a diverse set of publications including Health Economics, Challenge Magazine, and The Chronicle of Higher Education.  She has been interviewed on NPR and quoted in the New York Times and the Wall Street Journal.  She holds a PhD in economics from the University of Wisconsin and a Masters in Public Policy from the University of Texas.

Dr. Mark Pauly

Mark V. Pauly currently holds the position of Bendheim Professor in the Department of Health Care Systems at the Wharton School of the University of Pennsylvania.  He is Professor of Health Care Systems, Insurance and Risk Management, and Business and Public Policy at the Wharton School and Professor of Economics in the School of Arts and Sciences at the University of Pennsylvania.  He received the Ph.D. in Economics from the University of Virginia.  Dr. Pauly is a former commissioner on the Physician Payment Review Commission and an active member of the Institute of Medicine.  One of the nation’s leading health economists, Dr. Pauly has made significant contributions to the fields of medical economics and health insurance.  His classic study on the economics of moral hazard was the first to point out how health insurance coverage may affect patients’ use of medical services.  Subsequent work, both theoretical and empirical, has explored the impact of conventional insurance coverage on preventive care, on outpatient care, and on prescription drug use in managed care.  In addition, he has explored the influences that determine whether insurance coverage is available and, through several cost effectiveness studies, the influence of medical care and health practices on health outcomes and cost.  His interests in health policy deal with ways to reduce the number of uninsured through tax credits for public and private insurance, and appropriate design for Medicare in a budget-constrained environment.  He is currently studying the effect of poor health on worker productivity.  Dr. Pauly is a co-editor-in-chief of the International Journal of Health Care Finance and Economics and an associate editor of the Journal of Risk and Uncertainty.  He has served on Institute of Medicine panels on public accountability for health insurers under Medicare and on improving the financing of vaccines.  Dr. Pauly is a former member of the advisory committee to the Agency for Health Care Research and Quality, and most recently a member of the Medicare Technical Advisory Panel.