HEALTH CARE COST CONTAINMENT: AN ECONOMIC PERSPECTIVE
The term "cost containment" used in relation to the delivery of health care services means different things to different people. When former President George Bush spoke of health care cost containment, he most often referred to initiatives designed to constrain price increases for the delivery of health care services. When current President Bill Clinton speaks of health care cost containment, he most often refers to proposals aimed at slowing or reducing total expenditures for the delivery of health care services. When the State of Oregon speaks of health care cost containment, the focus is on the control of the level of health care services utilization (Eddy, 1991, pp. 2135 2140). When the American Medical Association speaks of health care cost containment, the issue most frequently cited is provider costs incurred by such activities as malpractice law suits and third party paperwork requirements (Starr, 1991, pp. 22 26).
The focus one places on the meaning of health care cost containment typically shapes the character of one's health care cost containment proposal. Thus, none of the cost containment proposals thus far presented are truly comprehensive in character. That deficiency is one of the reasons underlying the creation of the health care advisory committee created by President Clinton and chaired by Hillary Clinton. The major health care cost containment proposals thus far made tend to fall into one of four major classifications (1) insurance innovation, (2) delivery system reorganization, (3) mandating minimum health care coverage, and (4) universal health care coverage (Rovner, 1991b, pp. 414 415).
With respect to insurance innovation, the principal generic proposals are to: (1) require all employers to provide health care insurance coverage to their employees and to the dependents of their employees, or to pay a special tax into a fund that would prov...