1. Uses of Health Care Funds in the U.S. (2010) Source: Centers for Medicare and Medicaid Services [2012c]. 10-1

2. Sources of Health Care Funds in the U.S. (2010) 10-2 Source: Centers for Medicare and Medicaid Services [2012c].

3. The Advantages of Employer-Provided Health Insurance Increase the risk pool Reduce adverse selection Lower administrative costs 10-3

4. Employer-Provided Health Insurance and Job Lock Job lock Health Insurance Policy Portability and Accountability Act of 1996 (Kennedy- Kassenbaum Act) 10-4

5. Medicare Expenditures (1966-2010) Expenditures on Medicare as a Share of GDP Real expenditures on Medicare Source: Centers for Medicare and Medicaid Services [2012c]. 10-5

6. How Medicare Works Eligibility: elderly over 65 and disable Financing – Payroll tax funds => Hospital Insurance – General revenues fund => Supplementary Medical Insurance 10-6

7. Cost Control Under Medicare Medicare’s retrospective payment system Medicare’s prospective payment system: setting fixed reimbursement level – Diagnosis related groups – Resource-based relative value scale system 10-7

8. Medicare: Impacts on Spending and Health Expenditures on health care for the elderly Has health improved? Page 211 10-8

9. Medicaid: Overview Medicaid Eligibility: low – income people State Children’s Health Insurance Program 10-9

10. Medicaid Expenditures (1966-2010) Source: Centers for Medicare and Medicaid Services [2012c]. 10-10

11. Financing and Administration Joint Federal-State financing State administration 10-11

12. Benefits States obligated to offer minimum package of benefits States may offer more generous benefits 10-12

13. Health Care Costs and Health Outcomes: U.S., Canada, United Kingdom 10-13

14. Final Thoughts Security vs. efficiency No free lunch Connection between health care expenditures and health http://www.ahrq.gov/ 10-14