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Mandates and the Affordability of Health Care

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  • Sherry A. Glied
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    Abstract

    This paper examines the economic rationale of affordability exemptions in the context of a health insurance mandate. On its face, an affordability exemption makes little sense-- it exempts people from purchasing a good that policymakers believe benefits them. I provide an economic definition of affordability and discuss how it is implemented in the contexts of food, housing, and health care. Affordability standards are frequently used in food and housing policy making, but both empirically and theoretically health care operates quite differently than do these other merit goods. These differences help explain why the use of affordability in health policymaking is so different from its use in these other contexts. I conclude with a discussion of the relationship between mandates and exemptions in other health care systems.

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    Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 14545.

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    Date of creation: Dec 2008
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    Handle: RePEc:nbr:nberwo:14545

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    1. Getzen, Thomas E., 2000. "Health care is an individual necessity and a national luxury: applying multilevel decision models to the analysis of health care expenditures," Journal of Health Economics, Elsevier, Elsevier, vol. 19(2), pages 259-270, March.
    2. Helen Levy & Thomas DeLeire, 2003. "What Do People Buy When They Don't Buy Health Insurance And What Does that Say about Why They are Uninsured?," NBER Working Papers 9826, National Bureau of Economic Research, Inc.
    3. Nyman, John A., 1999. "The value of health insurance: the access motive," Journal of Health Economics, Elsevier, Elsevier, vol. 18(2), pages 141-152, April.
    4. Quigley, John M. & Raphael, Steven, 2004. "Is Housing Unaffordable? Why Isn't It More Affordable?," Berkeley Program on Housing and Urban Policy, Working Paper Series, Berkeley Program on Housing and Urban Policy qt1vp9j3k0, Berkeley Program on Housing and Urban Policy.
    5. Hansen, Julia L. & Formby, John P. & Smith, W. James, 1998. "Estimating the Income Elasticity of Demand for Housing: A Comparison of Traditional and Lorenz-Concentration Curve Methodologies," Journal of Housing Economics, Elsevier, Elsevier, vol. 7(4), pages 328-342, December.
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    Cited by:
    1. Gawel, Erik & Bretschneider, Wolfgang, 2010. "Investigating affordability problems of utility services - a theoretical study on the ratio measure," IAMO Forum 2010: Institutions in Transition – Challenges for New Modes of Governance, Leib­niz Institute of Agricultural Development in Central and Eastern Europe (IAMO) 52714, Leib­niz Institute of Agricultural Development in Central and Eastern Europe (IAMO).

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