In previous research, Finkelstein found that, while the introduction of Medicare substantially reduced health-care costs borne by seniors, it not only failed to reduce significantly mortality among the elderly but also was responsible for an enormous increase in hospital costs. Her assessment of a lottery expanding Medicaid to low-income adults was similarly sobering: while enrollment served to reduce out-of-pocket costs and increased the use of medical services, it yielded no significant improvement in measurable physical health outcomes.
She estimated that every dollar spent on the program was worth only 50 cents to beneficiaries, and that 60 percent of expenditures merely served to compensate hospitals and physicians for medical care that they had already been providing.
In coauthored studies, Finkelstein and Einav found that the Affordable Care Act did little to reduce Americans’ risk of losing health insurance, while its Medicare payment reforms served mostly to “generate inefficient transfers to hospitals.” Assessing the response of low-income households to ACA-style subsidies, they concluded that half of them would not purchase insurance even if taxpayers picked up 75 percent of the cost.
Health disparities between rich and poor … are mostly due to living conditions and lifestyles, and that the degree of health inequality in the United States is similar to that in single-payer countries like Norway or Sweden. Furthermore, they note that America’s uninsured currently “receive about four fifths of the medical care they would get if they were insured,” but “pay for only about twenty cents on the dollar for that medical care.”
Source: Chris Pope, City Journal