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California's Struggle With Insurance Exchanges Offers Lesson For National Reform
California"s experience with insurance exchanges could prove a valuable lesson for the nation"s flirtation with such pools for covering large numbers of people, The Wall Street Journal reports.
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Pledges To Reduce Health Care Costs, Spending Growth Could Violate Antitrust Laws, Lawyers Say
U.S. antitrust laws could affect health care industry groups" efforts to work together to rein in health care costs, the New York Times reports (Pear, New York Times, 5/27). In a letter sent to President Obama on May 10, a coalition of groups -- the American Medical Association, the American Hospital Association, Pharmaceutical Research and Manufacturers of America, the Advanced Medical Technology Association, America"s Health Insurance Plans and the Service Employees International Union -- pledged to reduce the annual health care spending growth rate by 1.5%. The groups did not elaborate on what specific measures they would use to achieve such reductions, but the Obama administration has requested specific plans from the groups by June 1 (Kaiser Daily Health Policy Report, 5/26). According to the Times, many of the plans being considered by the health care industry would require greater cooperation across health care providers. Robert Leibenluft, a former Federal Trade Commission official, said, "Any agreement among competitors with regard to prices or price increases -- even if they set a maximum -- would raise legal concerns." In addition, while Obama is asking for specific plans from the health care industry, the administration has not offered any relief from antitrust laws, the Times reports. Furthermore, during his campaign Obama pledged to increase enforcement of antitrust laws, according to the Times.Antitrust laws have had a negative effect on previous health reform efforts, the Times reports. In 1993, the drug industry established a voluntary cost control plan that limited each drug company"s annual increase in the average price of prescription drugs to the increase in the Consumer Price Index, but the Department of Justice ruled that the proposal would violate antitrust laws. DOJ officials said that the U.S. Supreme Court made it clear that setting price maximums was akin to setting price minimums, which is illegal. In a letter to the Senate Finance Committee, AHA wrote that uncertainty regarding the enforcement of antitrust laws "makes it difficult for a hospital and doctors to collaborate to improve care" and reduce costs. AMA has asked Congress to amend antitrust laws to allow physicians to collectively negotiate with insurers over fees and other concerns, but FTC repeatedly has designated the practice illegal price-fixing, according to the Times. FTC officials said that consumers could benefit from cooperation among health care industry groups but that cooperation also could lead to increased bargaining power for physicians and hospitals, making it easier for them to set prices and eliminate competition (New York Times, 5/27). Reform Developments
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Funding For Research On The H1N1 Flu Virus Announced By Government Of Canada
The Honourable Leona Aglukkaq, Minister of Health, is pleased to announce another measure to address the H1N1 flu virus. The Government of Canada will fund a national influenza research network focused on pandemic vaccine evaluation. The network will strengthen Canada"s capacity to evaluate the safety and effectiveness of a pandemic influenza vaccine and vaccination programs.
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Cigarette Tax Increase Will Decrease Number Of Smokers

Prof. Prakit Vathesatogkit, Executive Secretary of Action on Smoking and Health Foundation welcome the government policy of increasing cigarette tax. He believes that the tax increase will greatly benefit smokers in Thailand. This is due to the fact that the higher cigarette price will result in people smoking less or quit completely, especially in the lower income group. A country-wide research conducted in 2006 to evaluate the impact of tobacco tax increase, from 75% to 79% which led to 15% increase in price found that 58% of smokers smoke less while 10% have shifted to cheaper brand of cigarettes. Furthermore, 23% purchase only single sticks and 9% switch to hand-roll cigarettes. The number of people who quit smoking completely was at an impressive 10%. Dr. Prakit said " from 1993 through to 2007, the government of Thailand has increase tax 8 times in total. This gradually increases the price of Krongtip ( the most popular brand of cigarette) from 15 Baht per pack to 45 Baht per pack (while the latest increase leads to 56 Baht). The impact was most evidence in the lower income group in Thailand, which the smoking prevalence has declined from 42% in 1991 down to only 20.7% in 2007. The household income this groups spent on cigarettes also reduce from 16.30% in 1991 to 8% in 2007. According to the World Bank, the tobacco tax should be two-third or three- fourth (66-80%) of retail price in order to have desirable impact in reducing tobacco use. The current tax burden on cigarette is now 69% of the retail price (or 85% of factory price plus 7% VA, 2% health tax, 1.5% Public television tax and 0.5% local tax). World Bank has recommended all government to use Tobacco tax increase as one way to fight poverty. The obvious reason is that money saved from cigarette either by quitting or reducing number of cigarette, can then be spent on the improvement of healthier life-style as well as support their families. Citizen News Service


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