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The article reports on a new booklet, titled, "The Psychologist and Voluntary Health Insurance," from the American Psychological Association. It discusses coverage of psychological services for mental disorders under private health insurance plans. It maintain that if private companies restrict their coverage of psychotherapy only to Doctor of Medicine, who may have had little psychiatric training, they are in fact restricting the ability of the public to choose a psychotherapist freely.

In this paper a behavioral model consisting of sociodemographic, economic, ecological, need, and social psychological variables is developed and used to account for differential patterns of health and illness behavior among members of a pre paid medical group. Data from a sample of students who were enrolled in a university health plan were used to estimate parameters of structural equation models for males and females. The model suggests that social-psychological factors, such as symptom sensitivity and students' appraisal of the services provided, affect the extent to which they seek outside medical care. While medical need and insurance coverage both directly affect the choice of health services, sociodemographic and ecological factors appear largely to affect utilization indirectly through their effect on intervening social-psychological variables. [ABSTRACT FROM AUTHOR]

The article reports that the health policy issues become increasingly more salient to political scientists as a whole series of major decisions about future causes of action in health emerge before the U.S. President and Congress. State and local governments are also responding to the continued pressure of rising expenditures in health, especially for care of the poor and the medically indigent. On the current national legislative agenda are such items as a major expansion of national health insurance, restructuring of local and state health planning, continuing the commitment to health research and increasing health manpower training support.

This paper discusses a new type of hospital insurance called Variable Cost Insurance (VCI). The basic idea is to have each household choose its hospital(s), and then to make its insurance premium depend upon the costliness of the hospital chosen. The advantages of such a method in terms of improved efficiency and equity are pointed out. Extensions of the idea to physician services and comprehensive care are also discussed. This proposal is compared with other commonly proposed remedies for rising hospital costs such as planning, cost targets, and capitation. An experiment is proposed whereby VCI could be tested to determine its administrative feasibility and the gains which might accrue from its adoption. [ABSTRACT FROM AUTHOR]

This paper presents the historical, social, and economic concepts underlying the framing of Title XVIII of Public Law 89-97; the mechanics involved in implementing the medicare program; and the health services rendered medicare beneficiaries during the first year of operation. Attention is also directed to present and future contributions of the medicare program as a stimulant to the growth of the Nation's health care system. [ABSTRACT FROM AUTHOR]

This paper presents some findings from a sample survey dealing with bases of choice between Blue Cross-Blue Shield Comprehensive Plan and Community Health Association group practice plan by auto workers in the Detroit Metropolitan Area. Two independent probability samples were drawn to represent the choice groups, and different sampling rates were utilized to equalize sample sizes for group comparisons. Analysis focuses on such factors as selectivity in the type of people who are drawn to group practice; differences in desire for extension of coverage: and association of choice with frequency and intensity of perceived features of health plans. A major conclusion of the study is that most persons selected their plan on the basis of pragmatic and specific rather than ideological and general criteria. [ABSTRACT FROM AUTHOR]

ABSTRACT This paper is concerned with the differential impact of the Medicaid program on state incomes in 1967-68. Benefits and costs of the program are calculated for each state and the results are evaluated in terms of the perceived original intent of the program planners. It was found that although the program favors the poor in all states with Title XIX plans, it does so at the expense of extreme horizontal inequity. The conclusion is that federal incentives for the development of comprehensive state Medicaid programs are inadequate to insure an equitable system for the distribution of program benefits and costs. [ABSTRACT FROM AUTHOR]

This country is facing a massive crisis in health care. In this paper the author describes the failure of public and private programs and discusses the various proposals for restructuring the health tare "nonsystem" so that universal health insurance can be implemented. Basic criteria for a good health care system include universal coverage, comprehensive benefits, quality and cost controls, and built-in democratic controls. [ABSTRACT FROM AUTHOR]

This article presents a comment on economist Mark V. Pauly's paper on moral hazard. The author says Pauly has enriched the understanding of the phenomenon of so called moral hazard and has convincingly shown that the optimality of complete insurance is no longer valid when the method of insurance influences the demand for the services provided by the insurance policy. In the theory of optimal allocation of resources under risk bearing, it can be shown that competitive insurance markets will yield optimal allocation when the events insured are not controllable by individual behavior. The author says he would like to stress a point which Pauly overlooks in his exclusive emphasis on market incentives. He says Pauly's wording suggests that rational economic behavior and moral perfidy are mutually exclusive categories. The lesson of Pauly's paper is that the price system is intrinsically limited in scope by our inability to make factual distinctions needed for optimal pricing under uncertainty. Nonmarket controls, whether internalized as moral principles or externally imposed, are to some extent essential for efficiency.

The article presents information on studies by researchers at the Princeton University regarding labor and industrial relations in 1974. An investigation on the effect of manpower training programs on trainee earnings is being conducted by Orley Ashenfelter. The manuscript "The Human Nature of Organizations," by J. Douglas Brown focuses on the basic principles of industrial relations policy. Richard Lester is preparing a manuscript on the impact of equal employment opportunity legislation on the faculty and administrators in universities. Herman Somers is involved in a study of Canadian national health insurance as part of a long-term study of foreign health care systems. Yoram Weiss is completing two papers on the effect of risk on educational and occupational choice.

The relative importance of the determinants of physician utilization was examined using data obtained from a community health survey of 2,168 households in five New York and Pennsylvania counties. Eighteen variables, including individual and organizational attributes, were selected to determine the causal ordering of these variables in predicting use of physicians' services. It was found that the need for care, average cost per visit, health insurance coverage, and age have strong direct effects on physician utilization. The other variables had either an indirect or a negligible influence. The path analysis employed in this study reveals the great potential contribution of sociological methods in health services research. [ABSTRACT FROM AUTHOR]

In the health insurance movement, the provision of drugs has been one of the medical needs least well met. One prepaid medical care plan has pioneered in an effort to meet this need, and its precise experience is reported in this paper. [ABSTRACT FROM AUTHOR]

Based on three years experience in the New York City Health Department, abuses in the provision of Medicaid are analyzed and methods for dealing with those involved are described. [ABSTRACT FROM AUTHOR]

ABSTRACT Cross-section data are used to determine the effect of third-party payments on the length of stay in a hospital for 22 separate illnesses or conditions, thereby providing a test of the effect of third-party payments on resource allocation to hospitals. Also, estimates are made of price elasticities of demand for the separate illnesses or conditions. This study, by discovering patterns of behavior among medical categories that have been obscured in aggregate demand studies, has important implications regarding the existence and extent of "moral hazard," the effectiveness of coinsurance, and the effect of extended-care facilities on resource allocation. [ABSTRACT FROM AUTHOR]

This paper is predicated on the thesis that the agitation for compulsory health insurance in the United States, for more than a quarter of a century, constitutes a social movement. Its purpose is to show that it should concern the social scientist as much as the physician. In dealing with the more significant events of the movement, it is further proposed to demonstrate certain sequences so that one may take a more intelligent view in the future. While the technological lag during the count of the United States' industrialization has been relatively short, the periods of adjustment to the changes wrought by such industrialization, or the cultural lag, have been much longer. The various stages in the drive for health security show that reformist motives initiated the movement. In its second stage, while the analysis of the problems predominated, the premature legislative efforts almost brought the movement to a precipitous collapse. Development of voluntary health insurance plans as an alternative, as well as the results of fact-finding surveys, marked the third stage and paved the way for action.

This article presents a comment on a paper by economist K.J. Arrow. It is assumed that all individuals are expected utility maximizers and are risk-averters, and that the incidence of illness is a random event. This excludes preventive medicine from consideration, and it also ignores the effect that medical insurance might have on the purchase of preventive care. Arrow concluded that the absence of commercial insurance against some uncertain medical-care expenses provides a case for government intervention to provide such insurance. Economists Dennis Lees and R.D. Rice answered that this insurance was not offered because of selling and transactions costs. Arrow replied, in effect, that such costs were dead-weight losses anyway, and indeed would be eliminated by compulsory social insurance. In order for the welfare proposition given above to be valid, the costs of medical care must be random variables. But if such expenses are not completely random, the proposition no longer holds. The quantity of medical care an individual will demand depends on his income and tastes, how ill he is, and the price charged for it.

American families are in general overinsured against health expenses. If insurance coverage were reduced, the utility loss from increased risk would be more than outweighed by the gain due to lower prices and the reduced purchase of excess care. The first part of the paper develops and estimates a structural equation for the demand for health care and then examines the dynamic interaction between the purchase of insurance and the demand and supply for health care. The second part estimates the welfare gains that would result from decreasing insurance by raising the average coinsurance rate from 0.33 to 0.50 and 0.67 percent. The most likely values imply net gains in excess of $4 billion. [ABSTRACT FROM AUTHOR]

This article deals with a strike ordered by the National Federation of Physicians' Unions in Belgium in 1964. The strike started because of the failure of the government and the medical corps to agree on reforms in the Belgian sickness insurance program requested by the union. The causes of the financial difficulties involved in the program include an increase in the number of beneficiaries and additional allowances for drugs and hospital care. Two events in 1961 have increased the tension between the medical corps and its adversaries. Then a number of Belgian doctors cooperated with the Federation to conduct the strike.

As this note is being written, a proposal to provide health insurance to retired workers under Social Security—the Forand bill—is being vigorously debated. Although health care for such workers involves some special considerations, the arguments of the proponents of this bill and the massive support being marshalled for its passage are symptomatic of general concern over voluntary health insurance. The dilemma threatening the survival of many of these voluntary programs is that costs tend to outstrip their ability to provide the quantity and quality of health care demanded by the groups they serve. In this discussion, the authors attempt to identify the major problems currently at issue in voluntary health insurance and to describe and appraise some administrative innovations that have been made in a few instances to control costs and improve the quality of medical and hospital care. [ABSTRACT FROM AUTHOR]

A list of books related to public health and health insurance is presented. These books include "Prescription for National Health Insurance: A Proposal for the USA Based on Canadian Experience," by Peter Fisher, "Practical Aspects of Mental Health Consultation," by Jack Zusman, David L. Davidson and edited by Charles C. Thomas, and "It's So Good Don't Even Try It Once: Heroin in Perspective," by David E. Smith and George R. Gay.