Monday, January 08, 2007

Another angle on middlemen

As noted here before (and before), middlemen have the potential to increase the efficiency of the health care system, but they can also be a drag on the system. Paul Krugman last week* noted that the privatization of Medicare, including (but not limited to) the use of pharmacy benefits managers in the Part D pharmaceutical benefit, has not worked out so well. As an example, he notes that the managed-care portion of Medicare, now called Medicare Advantage, costs on average 11% more than traditional Medicare. So much for privatization, at whose alter this administration worships: It is an empty faith that drains dollars from public programs without increasing the welfare of their intended beneficiaries.

* Krugman's column is here, which is a TimesSelect address that requires a paid subscription. There's a good summary over at Mark Thoma's blog.
posted by tommayo, 6:25 AM

Health care law (including public health law, medical ethics, and life sciences), with digressions into constitutional law, poetry, and other things that matter