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Center for Policy Research


New Conundrums: Public Policy and the Emerging Health Care Marketplace

James R. Tallon

February 1998


There is a fundamentally new dynamic in American health care, one that has yet to be fully experienced but that threatens to leave a large portion of the American population without access to the quality health care they have received in the past. While the federal government has not completely abandoned the goal of assuring universal health care, a goal that dates back to the creation of Medicare and Medicaid in the 1960s and even earlier, the mechanisms to pursue that goal have changed. The implicit contract between government and health care providers--mostly doctors and not-for-profit hospitals--under which subsidized care was provided to those unable to pay has been broken in favor of more market-driven forces that promise a more cost-effective system, but a system that fails to protect a growing uninsured population. This new purchaser-driven system--in which costs increasingly determine the services that are provided--is likely to fall short of providing quality care to all who need it.

Health care is different from other services, and unless this difference is recognized we are in danger of permanently denying quality health care to a significant minority of our population. Regulation of the emerging "free market" in health care is needed and government must assure that role.

This report is sponsered by The Herbert Lourie Memorial Lecture series, which is jointly sponsored by the Maxwell School of Citizenship and Public Affairs and the Central New York Community Foundation, Inc. and is administered by the Center for Policy Research and The Lerner Center for Public Health Promotion and Population Health.

The Center for Policy Research at the Maxwell School of Syracuse University supports policy-relevant research and disseminates knowledge that enables leaders to make informed policy decisions and provide effective solutions to critical challenges in our local region, state, country and across the world.

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