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Alain C. Enthoven, PhD; Richard Kronick, PhD

JAMA. 1991;265(19):2532-2536.

Abstract
Roughly 35 million Americans have no health care coverage. Health care expenditures are out of control. The problems of access and cost are inextricably related. Important correctable causes include cost-unconscious demand, a system not organized for quality and economy, market failure, and public funds not distributed equitably or effectively to motivate widespread coverage. We propose Public Sponsor agencies to offer subsidized coverage to those otherwise uninsured, mandated employer-provided health insurance, premium contributions from all employers and employees, a limit on tax-free employer contributions to employee health insurance, and "managed competition." Our proposed new government revenues equal proposed new outlays. We believe our proposal will work because efficient managed care does exist and can provide satisfactory care for a cost far below that of the traditional fee-for-service third-party payment system. Presented with an opportunity to make an economically responsible choice, people choose value for money; the dynamic created by these individual choices will give providers strong incentives to render high-quality, economical care. We believe that providers will respond to these incentives.

(JAMA. 1991;265:2532-2536)

Author Affiliations
From the Graduate School of Business, Stanford (Calif) University (Dr Enthoven); and the Department of Community and Family Medicine, University of California, San Diego (Dr Kronick).

Footnotes
Reprint requests to Graduate School of Business, Stanford University, Stanford, CA 94305 (Dr Enthoven).

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