The status of local health care safety nets.

Abstract

Prologue: As the United States and other nations have embraced market incentives, questions have emerged regarding the sustainability of health and welfare safety nets both here and abroad. Indeed, the recent election of Lionel Jospin as prime minister in France served as a startling referendum by its citizens to its politicians to take more care in preserving that nation's safety net and to move more slowly toward privatization. The United States, which has a much more market-driven system than its European counterparts, faces perhaps an even more complex task in preserving its safety net. Other industrialized nations coordinate their safety-net efforts at the national level, while the American version is really a compilation of safety nets that vary tremendously across communities. Raymond Baxter and Robert Mechanic of The Lewin Group, a Fairfax, Virginia-based health care consulting firm, present here a snapshot of health care safety nets across the United States. Baxter, as senior vice-president at The Lewin Group, heads the firm's national public policy practice; he also heads the community monitoring initiative of the Center for Studying Health System Change, which is funded by The Robert Wood Johnson Foundation to track health care in sixty U.S. communities. Baxter has more than twenty years of public health experience, including serving as director of public health for San Francisco and as president of the New York City Health and Hospitals Corporation. He holds a doctorate in public and international affairs from Princeton University. Mechanic is a senior manager at Lewin, where he assists health care providers, government agencies, and community groups with financing, reimbursement, and organizational issues. Recently he published a paper on the impact of managed care on clinical research in Health Affairs (Fall 1996). He holds a master of business administration degree in finance from the University of Pennsylvania. This paper examines variations in the composition, concentration, financing, and community context of local health care “safety nets” and the market pressures that they face. It also reviews financing mechanisms that support these systems and strategies being undertaken to retain publicly insured patients. As safety-net providers compete more aggressively, the availability of the public health, behavioral health, and social services they provide may be affected. Communities may have to consider more explicit investments in these “public goods” if competitive markets remove existing cross-subsidies.