The Cato Institute

Paying Plasma Donors

About 83% of Canada’s immunoglobulin (used to treat several immune, blood, & neurological disorders) is made from plasma imported from U.S. for-profit plasma centers…

The United States allows payments for plasma donors and the establishment of for-profit plasma centers. In contrast, payments to plasma donors are illegal in several provinces of Canada, and more provinces are considering bans. 

As a result, Canada relies on imported plasma from American paid donors to meet its need for plasma-derived therapies. For example, approximately 83% of immunoglobulin, which is used to treat several immune, blood, and neurological disorders, is made from plasma imported from American for-profit plasma centers.

Canadian policymakers justify the prohibition on compensation with moral considerations and with concerns about the safety of plasma collected from paid donors. 

However, 72.6% of survey respondents in Canada are in favor of compensating plasma donors. Among those in favor of legalizing compensation for donors, the highest-rated motive was to guarantee a higher domestic supply. The majority of the respondents who were in favor of legalizing compensation also agreed that compensation would not run against mainstream Canadian moral and societal values.

Roughly half of those who declared they were against payments reported that they would reconsider their position if the domestic supply and imports were insufficient to meet domestic demand, meaning that up to about 85% of Canadian respondents could actually be in favor of compensating plasma donors.

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Is Preventive Care Worth the Cost?

Prevention of chronic disease has become a key health policy initiative in recent years. But, is preventative care actually working — and at what cost?

While the importance of disease prevention is hard to deny, relatively little attention has been paid to whether preventive care is worth its cost.

Diabetes mellitus (DM) is an incurable chronic disease of growing prevalence and, accordingly, one of the primary targets for prevention. It is often called a “silent killer” because individuals are not initially aware of the condition, but in the long-run they suffer serious complications, including eye, heart, kidney, and nerve problems.

Recent research underscores the economic and human cost of DM: in 2014, approximately 422 million adults had diabetes worldwide, incurring health costs estimated to total $825 billion per year. The disease can generally be prevented by early intervention to reduce lifestyle risk factors (such as smoking, unhealthy diet, sedentary lifestyle, and obesity). Diabetes mellitus and pre-diabetes can be detected by elevated blood sugar levels, a diagnostic test commonly included in regular health checkups.

In Japan, policymakers consider this so important that in 1972 they mandated that all employees receive an annual screening for elevated blood sugar. 

Have mandatory health checkups affected individuals’ medical care utilization, health behaviors, and health outcomes? Is the additional care worth the cost?

People do respond to health signals by undertaking follow-up visits with physicians and thus health signals can potentially promote preventive care. However, the absolute impact of the signal is small: exceeding the threshold increases the probability of visiting a physician for DM treatment by only 5 percentage points (albeit representing a 50% increase, i.e., from 10% to 15%). This small magnitude indicates that health signals do not effectively translate into preventive care for the majority of individuals. 

More importantly, despite the significant increase in medical care utilization at the borderline threshold, there is no evidence that the additional care improves health outcomes. Further, since almost all employers focus on the lower threshold to signal a warning of pre-diabetes, and neglect the threshold signifying the higher risk category of diabetes, crossing the high risk threshold does not increase medical care utilization or improve health outcomes.

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Five Unavoidable Obamacare Reform Realities

The congressional Republican bill is flawed, but so are many of the talking points being used against it…

It has been barely a week since the Republican plan to (sort of) repeal and replace Obamacare was unveiled and already the proposal has been savaged from both left and right, by most of the media, by various interest groups, including doctors, hospitals, and insurance companies, and by virtually anyone else with an opinion. Outside of Paul Ryan, it is hard to find anyone who truly likes this bill.

While it is true that the American Health Care Act is a deeply flawed bill that perpetuates — and in some cases exacerbates — some of Obamacare’s worst aspects, many of the talking points being used against it are even worse.

Here are the top five things to keep in mind about healthcare reform…

1. There will be losers as well as winners. Every piece of legislation creates winners and losers. Obamacare did. There were far more losers than winners, but some of those who won under Obamacare will be losers under the Republican plan. 
   
2. There will be more winners than losers. Premiums would be lower under the GOP plan starting in 2020, about 10 percent lower by 2026. Plus, the more than $1 trillion in tax cuts — many for the middle class — and the $337 billion reduction in deficits over the next ten years mean more jobs and economic growth, a big win for everybody.
   
3. 14 million people are not having their insurance taken away. Much of the projected decline in coverage stems from CBO’s belief that, without the individual mandate, many people would choose not to buy insurance. 
   
4. Of the 25 million fewer insured in 2026, 14 million would come from a reduction in Medicaid enrollment. That may sound alarming, but Medicaid was not only fiscally unstainable in its current form, it provided barely minimal care. Reforming Medicaid in a way that encourages states to innovate and focus more of their resources on the most vulnerable populations can only benefit those most in need.
   
5. The alternative is Obamacare not utopia. Projections of how many people would be insured or what premiums would be ten years from now assume that Obamacare would survive that long. It couldn’t, not in its current form.
   

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What Are We “Replacing” Obamacare With?

Republicans have officially begun the long and complex road to repealing and “replacing” Obamacare…

If you believe congressional Democrats, various special-interest groups and much of the media, the Four Horsemen of the Apocalypse are about to be unleashed. Let’s all get a grip.

Initially, any changes will be very small and incremental. Repeal won’t happen overnight, or all at once. Rather, Republicans are likely to establish a sunset date, three or four years from now, allowing time to craft a replacement. Still, sooner or later, we’ll be living under a very different health-care system. 

In general, most consumers will find themselves with more and better insurance choices after ObamaCare is repealed.

One of the first things most Americans are likely to find is that they’ll have more choices when it comes to buying insurance. You may have to pay more for insurance that covers some providers and conditions, but you’ll also be able to buy cheaper, less-comprehensive insurance if you want to.

ObamaCare required all insurance to cover a wide-ranging — and expensive — “essential benefits package.” Repeal will mean more of an a la carte approach to insurance, based on individual consumer preference.

Consumers won’t just find more options in the types of plans; there should also be more insurers to choose from. And, a replacement plan will almost certainly let you shop for insurance out of state, forcing some much-needed competition into the insurance market.

People will even have the choice not to buy insurance at all, since the much-reviled individual mandate will be gone. Going without insurance may not necessarily be a wise choice, but it does re-establish a fundamental limit to state power over the individual. And it allows young and healthy people to purchase low-cost catastrophic coverage that makes much more sense for them.

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Medicaid and Medicare Turn 50

50 years ago today, President Lyndon B. Johnson signed legislation creating Medicare and Medicaid. 

Despite their popularity with seniors, the disabled, the needy, and those who might otherwise have to care for them, Medicare and Medicaid have done enormous damage to the U.S. health care sector and to individual liberty.

Read recent Cato Institute research and commentary on this topic: 

• Nicole Kaeding discusses the recent GAO report citing rampant fraud and waste in Medicaid on NBC WLUC TV6 Morning News
  
• The Size and Scope of Fraud in Medicare, Cato Blog Post by Nicole Kaeding