Posting date: July 26, 2005

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Health Affairs, 10.1377/hlthaff.w5.329
Copyright © 2005 by Project HOPE

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Turning Medicare And Medicaid Into Health Programs: The Role Of Organizational Culture

¹ Leonard Schaeffer is chairman of the board of WellPoint Inc. in Thousand Oaks, California; he was chairman and chief executive officer of WellPoint from 1993 through 2004. Schaeffer was administrator from November 1978 to June 1980. He went on to serve as president, chairman, and CEO of Blue Cross of California and president of Group Health Inc., a large health maintenance organization. He served as assistant secretary of management and budget at the U.S. Department of Health and Human Services (at the time Health, Education, and Welfare).

^*Corresponding author.

Abstract

In this paper we present a new framework for understanding the factors driving the growth in private health insurance spending. Our analysis estimates how much of the rise in spending is attributable to a rise in treated disease prevalence and spending per treated case. Our results reveal that the rise in treated disease prevalence, rather than the rise in spending per treated case, was the most important determinant of the growth in private insurance spending between 1987 and 2002. A rise in population risk factors and the introduction of new technologies underlie these trends.

Key Words: Elderly, Health Reform, Medicaid, Medicare, Politics

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