Topic: Cato Publications

New at Cato Unbound: Mexicans in America

Be sure to check out today’s fresh August issue of Cato Unbound, kicking off with celebrated essayist Richard Rodriguez’s provocative meditation on the place of Mexico and Mexicans in the U.S. economy and consciousness. Here’s a taste:

It is as though America, having benefited from illegal labor, pretends that the transaction was one of middle-class benevolence. Mexicans should be thankful for a month of cheerless eight-hour shifts, standing there waiting for the old lady to get off the commode. The odd thing is that they are thankful!

Read the whole thing, and stay tuned: Mexifornia author Victor Davis Hanson will reply on Wednesday, and it’s not going to be a lovefest.

Next Week at Cato Unbound: Mexicans in America

Tune in Monday for the August issue of Cato Unbound, devoted to the topic of “Mexicans in America.”

Richard Rodriguez, author of the celebrated Hunger of Memory and, most recently, Brown: The Last Discovery of America, leads off this month’s issue with a provocative meditation on the role of Mexico and Mexicans in the U.S. economy and consciousness. Hoover Institution senior fellow Victor Davis Hanson, author of Mexifornia, will reply, along with Douglas Massey of Princeton University’s Mexican Migration Project, and labor economist and immigration expert Steve Trejo at the University of Texas.

Here’s the subject:

Today’s heated debate over immigration and border control is largely a debate about Mexicans. It is often argued that Mexican immigrants in particular place a heavy burden on social services, especially in border states, bring crime in their wake, depress wages, and displace American workers. Some argue that although we are a nation of immigrants, and that immigration is generally good, Mexican immigrants are different: they are either unwilling or unable to assimilate and become full-fledged Americans, and, therefore, a heavy concentration of Mexican immigrants in the Southwest threatens a distinctly American way of life. How much truth, if any, is in these arguments? A reasonable debate about Mexican immigration requires that we really know about Mexicans in America. Who are the Mexicans coming to the U.S.? Are they fitting in? Are their children fitting in? Their children’s children? What kind of contribution are they making to the American economy and national character? In what ways are the U.S. and Mexico interdependent? Are the new Mexican immigrants buying homes, starting businesses, setting down roots? Are they upwardly mobile? Civically active? Is their participation in the labor market hurting American workers? Making America richer, economically and culturally? Answers to these questions can make a huge difference–between belief in amnesty and openness, or deportation and a wall. Getting it right matters. So let’s try to get it right.

Don’t miss it! To make sure you don’t, why not subscribe to Cato Unbound’s RSS feed, or sign up for email notification of new posts?

“Chaoulli has brought Canadian Medicare to a fork in the road”

Colleen Flood of the University of Toronto law school has a working paper out on the impact of the Canadian Supreme Court’s ruling in Chaoulli v. Quebec. In that case the court basically said that if the government prohibits private health insurance, but then threatens people’s lives by making them wait for care in the state-run health care system, it is violating the people’s rights to life, liberty, and personal security.

Prof. Flood’s paper is titled, “Chaoulli’s Legacy for the Future of Canadian Health Care Policy.” From the abstract:

The decision was initially considered of limited importance by many given that technically it applied only to Quebec. In the six months since the decision was released, however, it has become clear that the legal impact of Chaoulli will be dwarfed by its normative impact on policy debates across the country. Chaoulli has brought Canadian Medicare to a fork in the road. At the time of writing, critical decisions are about to be taken across the country.

Flood’s paper is available from the Social Science Research Network here (subscription req’d).

Dr. Chaoulli – the chief litigant in the case – authored a paper for Cato on the ruling and its potential impact, available here.

P4P Hubris

Dr. Rob Lamberts also comments on my paper on pay-for-performance (P4P) in Medicare. Lamberts (like Holt) seems to have blogged that paper having only read the press release. Though the paper probably would answer most of the questions they raise, I’ll respond to two of Lamberts’ comments.

1. Lamberts argues that a P4P experiment in Britain’s National Health Service (NHS) refutes my claim that “provider-focused P4P incentives can encourage inappropriate care or reduce access to care for patients with multiple illnesses or low incomes.”

Not quite. A P4P scheme can avoid those effects, but not without causing other problems. For example, the financial incentives could involve only additional payments to physicians and no payment reductions for “low-quality” care. That’s what the NHS did; physicians’ gross incomes increased by an average of $40,000.

A rewards-only approach reduces the incentive for physicians to avoid very sick or very poor patients, who make it difficult for the physician to meet the performance goals. However, that approach makes the P4P effort more costly. Lamberts himself suggests that Medicare’s P4P efforts should be budget-neutral, which would make it more likely that physicians would give outlier patients inappropriate care, avoid those patients, or otherwise game the system.

Another way the NHS experiment avoided inappropriate care or a reduction in access for outliers was by allowing physicians the discretion to disregard as many of their patients as they wished when calculating their compliance score. But the availability of such “exclusion reporting” also gave physicians an opportunity to game the system. Rather than provide the desired type of care to their patients, physicians could use exclusion reporting to increase their incomes without changing their behavior. The authors of the study cited by Lamberts note: “More research is needed to determine whether these practices are excluding patients for sound clinical reasons or in order to increase income.”

2. Lamberts writes that the Brits “were able to achieve astonishing improvements to their quality numbers and improve physician incomes at the same time.”

Of course, these two ends are not in conflict. It’s easy to get people to do what you want when you dangle $40,000 in front of them.

But we can’t even be sure that the NHS P4P experiment made any improvements in quality — much less astonishing improvments in quality. Although median reported achievement was an impressive-sounding 83.4 percent, according to the authors of that study:

There is no baseline with which to compare performance in the first year of the U.K. program, although the quality of care was already improving before its introduction.

If we don’t know what compliance rates were before the NHS introduced financial incentives for compliance, and quality was improving anyway for other reasons, how do we know whether or how much their quality numbers improved, or how much of that change was due to P4P? 

If we don’t even know that, we certainly don’t know whether the effort was worth the $3.2 billion the NHS spent in 2004.

Medicare Reform: It’s All about Control

Matthew Holt of The Health Care Blog takes a thoughtful stab at my recent paper on “pay-for-performance” and Medicare. 

Pay-for-performance is one of those hip health policy buzzwords that comes with a catchy acronym: P4P. The idea is that private insurers or the government can improve health care quality through financial rewards for providers who deliver what the payer considers “quality” care. P4P stands in contrast to “pay-for-volume,” which is how third-party payers have traditionally paid providers.

My thesis is that P4P has promise, but is very, very tricky. A bureaucracy that rewards providers for what it considers high-quality care can actually encourage low-quality care for the poor saps who happen not to be the average patient. 

There’s nothing wrong with P4P, so long as patients who are getting short-changed have the right to opt out (i.e., switch insurers). P4P’s potential is sure to be lost if the Centers for Medicare and Medicaid Services (CMS) get into the game. For example, since Medicare’s P4P scheme would be emulated by Medicare Advantage plans and other private insurers, many patients would have no escape.

Holt tries to link (reconcile?) my opposition to P4P in traditional Medicare (and support for P4P in Medicare Advantage plans) with my suggestion that Medicare should subsidize seniors with a risk-adjusted voucher rather than coverage. Let me see if this helps thread the two together:

There’s a difference between helping someone in need and making all her decisions for her. Medicare has traditionally tried to do both, offering subsidies to seniors but also dictating what their coverage looks like, payment rates, etc.  If CMS starts defining “quality” for 45 million seniors (and by extension, millions of non-seniors), the government will be making even more decisions that it’s really not qualified to make. Better that Congress just give seniors the cash and let them make their own decisions about coverage and care and quality. Markets have a funny way of helping people make those decisions.

Yes, there will still be some seniors who are ill-equipped to do that. But that small minority of seniors already needs — and gets — similar assistance. They can be taken care of without turning the rest of the health care sector into a high-cost, iffy-quality, rent-seeking cesspool.