Spending Caps Research Articles

An Overview of Adjustments to the Budget Enforcement Act Discretionary Spending Caps

This article reviews the adjustments that have been made to the limits on discretionary federal spending that were enacted as part of the Budget Enforcement Act of 1990. Each type of adjustment authorized by that act is described, and the actual adjustments made by the U.S. Office of Management and Budget are discussed. Tables that display the amounts and timing of the adjustments are used to support the narrative. The article also discusses the relationship of cap adjustments to changes in the federal budget deficit.

Entitlements, the deficit, and spending caps.

This article investigates three common perceptions about entitlement spending-that it is the primary cause of growing budget deficits, that nonmeans-tested entitlements (such as Social Security and Medicare) have grown faster than other entitlement programs, and that nonmeans-tested benefit programs are skewed toward the affluent. Drawing on data from the vast 30 years of federal spending and tabulations from the Current Population Survey, the article concludes that these perceptions are inaccurate. The article then examines recently proposed spending caps, finding that they would have had little impact on entitlement spending other than Medicare and Medicaid, but would have required very large cuts in those two programs. It discusses the mechanics of spending caps, their effect on the nature of entitlement benefits; and the feasibility of placing caps on cash versus in-kind entitlement benefits. It concludes that, while direct spending caps would in effect change entitlements into discretionary programs,...

Musculoskeletal Injuries in the Workplace: Defining Quality Care

Quality health care for a specific medical condition may be defined as adherence to an algorithm in which decision points are based on established medical practice as supported in the literature. The decision points can be considered either a "stan-dard of care" if there is definitive scientific evidence for their validity or a "guide-line for care" if there is only a consensus of medical opinion available. Algorithms for musculoskeletal injuries can be and have been successfully applied to patients in the workers' compensation setting. They can function as a concurrent surveil-lance system and are well accepted by physicians, patients, and industry if imple-mented by unbiased medical experts. A high level of quality care is attained by following such algorithms. Other goals achieved are early functional restoration as measured by return to work, a more efficient use of diagnostic studies, and avoidance of unnecessary therapeutic interventions, with the result that treatment is more cost-effective. Such a program that strives for high-quality care and emphasizes appropriate utilization will realize cost savings that may be far greater and longer lasting than the financial saving seen with arbitrary spending caps and fee controls.

Redefining the Terms of Health Insurance to Accommodate Varying Consumer Risk Preferences

Proposals for managed competition present the following question: what are health insurers to compete over? If the competition managers allow insurers to offer truly minimal benefit packages, then competition might focus on enhancements to that minimal package. However, most current proposals require a relatively generous minimal benefit package that includes nearly everything that any consumer is willing to pay for, eliminating this arena of competition. Uniform benefit packages would presumably encourage price competition, not only because it is then the insurers’ only remaining arena of competition, but also because uniform benefits facilitate consumers making price comparisons. However, if government sets global spending caps, adopts mandatory fee schedules, and requires community rating for health insurance premiums, as President Clinton proposes to do, there will be little room left for price competition either. With uniform benefit packages and regulated prices, the managed competition plan ends up with an abundance of management and precious little competition.