Personal Health Accounts Help Reform Medicaid
Florida, Oklahoma and South Carolina, which have "taken the step of permitting Medicaid enrollees to choose health services and providers for themselves" through personal health accounts, are "simply coming to grips with reality -- Medicaid needs fundamental change," Sen. Tom Coburn (R-Okla.) and Regina Herzlinger, a professor at Harvard Business School and a senior fellow at the Manhattan Institute, write in a Wall Street Journal opinion piece.
The three states "have embarked on a path that is at once less draconian and yet more radical," adding that the benefits of the "simple but revolutionary system" of PHAs "will be enormous" as health care costs "remain low, government outlays stable and state finances healthy," the authors write. "Private accounts will introduce market incentives into the Medicaid system, lightening obligations all around," the authors write, adding, "Medicaid enrollees can shop for care and increase their chances of receiving the care they need," and health care providers, "compelled to compete for Medicaid customers, will likely offer more consumer-oriented services at competitive costs."
According to the authors, "Strong-arming enrollees and providers with rationing tactics is not the only, and surely not the best way, to control Medicaid costs." They conclude, "We can move beyond the 'Scrooge' option. Letting consumers drive the system is better both for the health of patients and the solvency of their home states" (Coburn/Herzlinger, Wall Street Journal, 5/18).