Standard of Living
Meltem Daysal
Journal of Health Economics, forthcoming
Abstract:
In this paper, I examine the impact of uninsured patients on the in-hospital mortality rate of insured heart attack patients. I employ panel data models using patient discharge and hospital financial data from California (1999-2006). My results indicate that uninsured patients have an economically significant effect that increases the mortality rate of insured heart attack patients. I show that these results are not driven by alternative explanations, including reverse causality, patient composition effects, sample selection or unobserved trends and that they are robust to a host of specification checks. The primary channel for the observed spillover effects is increased hospital uncompensated care costs. Although data limitations constrain my capacity to check how hospitals change their provision of care to insured heart attack patients in response to reduced revenues, the evidence I have suggests a modest increase in the quantity of cardiac services without a corresponding increase in hospital staff.
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Unveiling the Mystery of Online Pharmacies: An Audit Study
Roger Bate, Ginger Zhe Jin & Aparna Mathur
NBER Working Paper, March 2012
Abstract:
This study assesses the trade-off between drug safety and price savings in online drug purchases. Focusing on five brand-name prescription drugs, we acquire 370 drug samples from 41 online pharmacies and test their authenticity. Of the 41 websites, 8 are clearly US-based and verified by the National Association of Boards of Pharmacy (NABP) or LegitScript.com. We refer to them as tier 1. Another 23 websites - referred to as tier 2 - are not verified by NABP or LegitScript but verified by PharmacyChecker.com or the Canadian International Pharmacy Association (CIPA). The remaining 10 websites are not verified by any of the four verification agencies and therefore classified as tier 3. Most tier 2 and tier 3 websites are foreign. We have two main findings. First, according to our Raman spectrometry test, no failure of authenticity is found in drugs that came from verified websites, the only failures are Viagra from non-verified websites in tier 3. Second, within verified websites, tier 1 websites on average charge 52.5% more than tier 2 websites in final price (including shipping and handling) for the same drug and dosage except for Viagra. On Viagra, tier 1 and tier 2 websites show no difference in drug safety and price, but if one aims to get authentic Viagra, verified websites are both safer and cheaper than non-verified websites in tier 3. These findings confirm the FDA warning against rogue websites but suggest that a blanket warning against any foreign website may deny consumers substantial price savings from verified tier 2 websites.
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Tomas Philipson et al.
Health Affairs, April 2012, Pages 667-675
Abstract:
The United States spends more on health care than other developed countries, but some argue that US patients do not derive sufficient benefit from this extra spending. We studied whether higher US cancer care costs, compared with those of ten European countries, were "worth it" by looking at the survival differences for cancer patients in these countries compared to the relative costs of cancer care. We found that US cancer patients experienced greater survival gains than their European counterparts; even after considering higher US costs, this investment generated $598 billion of additional value for US patients who were diagnosed with cancer between 1983 and 1999. The value of that additional survival gain was highest for prostate cancer patients ($627 billion) and breast cancer patients ($173 billion). These findings do not appear to have been driven solely by earlier diagnosis. Our study suggests that the higher-cost US system of cancer care delivery may be worth it, although further research is required to determine what specific tools or treatments are driving improved cancer survival in the United States.
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Daniel McFadden, Carlos Noton & Pau Olivella
NBER Working Paper, March 2012
Abstract:
This expository paper describes the factors that contribute to failure of health insurance markets, and the regulatory mechanisms that have been and can be used to combat these failures. Standardized contracts and creditable coverage mandates are discussed, along with premium support, enrollment mandates, guaranteed issue, and risk adjustment, as remedies for selection-related market damage. An overall conclusion of the paper is that the design and management of creditable coverage mandates are likely to be key determinants of the performance of the health insurance exchanges that are a core provision of the PPACA of 2010. Enrollment mandates, premium subsidies, and risk adjustment can improve the stability and relative efficiency of the exchanges, but with carefully designed creditable coverage mandates are not necessarily critical for their operation.
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Darius Lakdawalla et al.
Health Affairs, April 2012, Pages 676-682
Abstract:
Assessments of the medical and economic value of therapies in diseases such as cancer traditionally focus on average or median gains in patients' survival. This focus ignores the value that patients may place on a therapy with a wider "spread" of outcomes that offer the potential of a longer period of survival. We call such treatments "hopeful gambles" and contrast them with "safe bets" that offer similar average survival but less chance of a large gain. Real-world therapy options do not have these stylized forms, but they can differ in the spread of survival gains that patients face. We found that 77 percent of surveyed cancer patients with melanoma, breast cancer, or other kinds of solid tumors preferred hopeful gambles to safe bets. This suggests that current technology assessments, which often determine access to such cancer therapies, may be missing an important source of value to patients and should either incorporate hope into the value of therapies or set a higher threshold for an acceptable cost-effectiveness ratio in the end-of-life context.
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Do High-Cost Hospitals Deliver Better Care? Evidence from Ambulance Referral Patterns
Joseph Doyle et al.
NBER Working Paper, March 2012
Abstract:
Endogenous patient sorting across hospitals can confound performance comparisons. This paper provides a new lens to compare hospital performance for emergency patients: plausibly exogenous variation in ambulance-company assignment. Ambulances are effectively randomly assigned to patients in the same area based on rotational dispatch mechanisms. Using Medicare data from 2002-2008, we show that ambulance company assignment importantly affects hospital choice for patients in the same zip code. Using data for New York state from 2000-2006 that matches exact patient addresses to hospital discharge records, we show that patients who live very near each other but on either side of ambulance-dispatch boundaries go to different types of hospitals. Both strategies show that higher-cost hospitals have significantly lower one-year mortality rates compared to lower-cost hospitals. We find that common indicators of hospital quality, such as indicators for "appropriate care" for heart attacks, are generally not associated with better patient outcomes. On the other hand, we find that measures of "leading edge" hospitals, such as teaching hospitals and hospitals that quickly adopt the latest technologies, are associated with better outcomes, but have little impact on the estimated mortality-hospital cost relationship. We also find that hospital procedure intensity is a key determinant of the mortality-cost relationship, suggesting that treatment intensity, and not differences in quality reflected in prices, drives much of our findings. The evidence also suggests that there are diminishing returns to hospital spending and treatment intensity.
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Ateev Mehrotra et al.
Health Affairs, April 2012, Pages 843-851
Abstract:
There is tremendous interest in different approaches to slowing the rise in US per capita health spending. One approach is to publicly report on a provider's costs - also called efficiency, resource use, or value measures - with the hope that consumers will select lower-cost providers and providers will be encouraged to decrease spending. In this paper we explain why we believe that many current cost-profiling efforts are unlikely to have this intended effect. One of the reasons is that many consumers believe that more care is better and that higher-cost providers are higher-quality providers, so giving them information that some providers are lower cost may have the perverse effect of deterring them from accessing these providers. We suggest changes that can be made to content and design of public cost reports to increase the intended consumer and provider response.
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The Impact of Patient Cost-Sharing on the Poor: Evidence from Massachusetts
Amitabh Chandra, Jonathan Gruber & Robin McKnight
NBER Working Paper, April 2012
Abstract:
Greater patient cost-sharing could help reduce the fiscal pressures associated with insurance expansion by reducing the scope for moral hazard. But it is possible that low-income recipients are unable to cut back on utilization wisely and that, as a result, higher cost-sharing will lead to worse health and higher downstream costs through hospitalizations. We use exogenous variation in the copayments faced by low-income enrollees in the Massachusetts' Commonwealth Care program to study these effects. We estimate separate price elasticities of demand by type of service (hospital care, drugs, outpatient care). Overall, we find price elasticities of about -0.15 for this low-income population - fairly similar to elasticities calculated for higher-income populations in other settings. These elasticities are somewhat larger for the chronically sick and older enrollees. A substantial portion of the decline in utilization comes from some patients cutting back on use completely, but we find no (detectable) evidence of offsetting increases in hospitalizations or emergency department visits in response to the higher copayments, either overall or for the chronically ill in particular.
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Health Inequalities: Trends, Progress, and Policy
Sara Bleich et al.
Annual Review of Public Health, 2012, Pages 7-40
Abstract:
Health inequalities, which have been well documented for decades, have more recently become policy targets in developed countries. This review describes time trends in health inequalities (by sex, race/ethnicity, and socioeconomic status), commitments to reduce health inequalities, and progress made to eliminate health inequalities in the United States, United Kingdom, and other OECD countries. Time-trend data in the United States indicate a narrowing of the gap between the best- and worst-off groups in some health indicators, such as life expectancy, but a widening of the gap in others, such as diabetes prevalence. Similarly, time-trend data in the United Kingdom indicate a narrowing of the gap between the best- and worst-off groups in some indicators, such as hypertension prevalence, whereas the gap between social classes has increased for life expectancy. More research and better methods are needed to measure precisely the relationships between stated policy goals and observed trends in health inequalities.
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The persistence of health inequalities in modern welfare states: The explanation of a paradox
Johan Mackenbach
Social Science & Medicine, forthcoming
Abstract:
The persistence of socioeconomic inequalities in health, even in the highly developed ‘welfare states' of Western Europe, is one of the great disappointments of public health. Health inequalities have not only persisted while welfare states were being built up, but on some measures have even widened, and are not smaller in European countries with more generous welfare arrangements. This paper attempts to identify potential explanations for this paradox, by reviewing nine modern ‘theories' of the explanation of health inequalities. The theories reviewed are: mathematical artifact, fundamental causes, life course perspective, social selection, personal characteristics, neo-materialism, psychosocial factors, diffusion of innovations, and cultural capital. Based on these theories it is hypothesized that three circumstances may help to explain the persistence of health inequalities despite attenuation of inequalities in material conditions by the welfare state: (1) inequalities in access to material and immaterial resources have not been eliminated by the welfare state, and are still substantial; (2) due to greater intergenerational mobility, the composition of lower socioeconomic groups has become more homogeneous with regard to personal characteristics associated with ill-health; and (3) due to a change in epidemiological regime, in which consumption behavior became the most important determinant of ill-health, the marginal benefits of the immaterial resources to which a higher social position gives access have increased. Further research is necessary to test these hypotheses. If they are correct, the persistence of health inequalities in modern European welfare states can partly be seen as a failure of these welfare states to implement more radical redistribution measures, and partly as a form of ‘bad luck' related to concurrent developments that have changed the composition of socioeconomic groups and made health inequalities more sensitive to immaterial factors. It is argued that normative evaluations of health inequalities should take these explanations into account, and that a direct attack on the personal, psychosocial and cultural determinants of health inequalities may be necessary to achieve a substantial reduction of health inequalities.
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The New York Times Readers' Opinions About Paying People to Take Their Medicine
James Park et al.
Health Education & Behavior, forthcoming
Background: There has been considerable interest in using financial incentives to help people improve their health. However, paying people to improve their health touches on strongly held views about personal responsibility.
Method: The New York Times printed two articles in June 2010 about patient financial incentives, which resulted in 394 comments from their online audience. The authors systematically analyzed those online responses to news media in order to understand the range of themes that were expressed regarding the use of financial incentives to improve health.
Results: The New York Times online readers revealed a broad range of attitudes about paying individuals to be healthy. Many comments reflected disdain for financial incentives, describing them as "absurd" or "silly." Other comments reflected the notion that financial incentives reward individuals for being irresponsible toward their health. Many individuals communicated concerns that paying individuals for healthy behaviors may weaken their internal drive to be healthy. A smaller set of comments conveyed support for financial incentives, recognizing it as a small sum to pay to prevent or offset higher costs related to chronic diseases.
Conclusions: Although a measurable group of individuals supported financial incentives, most readers revealed negative perceptions of these approaches and an appeal for greater personal responsibility for individual health. Despite experimental success of financial incentives, negative perceptions may limit their public acceptability and uptake.
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Liam O'Neill & Arthur Hartz
Health Affairs, April 2012, Pages 806-815
Abstract:
Physician-owned cardiac specialty hospitals advertise that they have outstanding physicians and results. To test this assertion, we examined who gets referred to these hospitals, as well as whether different results occur when specialty physicians split their caseloads among specialty and general hospitals in the same markets. Using data on 210,135 patients who underwent percutaneous coronary interventions in Texas during 2004-07, we found that the risk-adjusted in-hospital mortality rate for patients treated at specialty hospitals was significantly below the rate for all hospitals in the state (0.68 percent versus 1.50 percent). However, the rate was significantly higher when physicians who owned cardiac specialty hospitals treated patients in general hospitals (2.27 percent versus 1.50 percent). In addition, several patient characteristics were associated with a lower likelihood of being admitted to a cardiac hospital for cardiac care, such as being African American or Hispanic and having Medicaid or no health insurance. After adjustment for patient severity and number of procedures performed, the overall outcomes for cardiologists who owned specialty hospitals were not significantly different from the "average outcomes" obtained at noncardiac hospitals. In contrast to previous studies, patient outcomes were found to be highly dependent on the type of hospital where the procedure was performed. To remove a potential source of bias and achieve a more balanced comparison, the quality statistics reported by physician-owned cardiac hospitals should be adjusted to incorporate the high rates of poor outcomes for the many procedures done by their cardiologists at nearby noncardiac hospitals.
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Efficiency and Equity: A Stated Preference Approach
Richard Norman et al.
Health Economics, forthcoming
Abstract:
Outcome measurement in the economic evaluation of health care considers outcomes independent of to whom they accrue. This article reports on a discrete choice experiment designed to elicit population preferences regarding the allocation of health gain between hypothetical groups of potential patients. A random-effects probit model is estimated, and a technique for converting these results into equity weights for use in economic evaluation is adopted. On average, the modelling predicts a relatively high social value on health gains accruing to nonsmokers, carers, those with a low income and those with an expected age of death less than 45 years. Respondents tend to favour individuals with similar characteristics to themselves. These results challenge the conventional practice of assuming constant equity weighting. For decision makers, whether a formal equity weighting system represents an improvement on more informal approaches to weighing up equity and efficiency concerns remains uncertain.
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Estimating the NIH Efficient Frontier
Dimitrios Bisias, Andrew Lo & James Watkins
PLoS ONE, May 2012
Background: The National Institutes of Health (NIH) is among the world's largest investors in biomedical research, with a mandate to: "...lengthen life, and reduce the burdens of illness and disability." Its funding decisions have been criticized as insufficiently focused on disease burden. We hypothesize that modern portfolio theory can create a closer link between basic research and outcome, and offer insight into basic-science related improvements in public health. We propose portfolio theory as a systematic framework for making biomedical funding allocation decisions-one that is directly tied to the risk/reward trade-off of burden-of-disease outcomes.
Methods and Findings: Using data from 1965 to 2007, we provide estimates of the NIH "efficient frontier", the set of funding allocations across 7 groups of disease-oriented NIH institutes that yield the greatest expected return on investment for a given level of risk, where return on investment is measured by subsequent impact on U.S. years of life lost (YLL). The results suggest that NIH may be actively managing its research risk, given that the volatility of its current allocation is 17% less than that of an equal-allocation portfolio with similar expected returns. The estimated efficient frontier suggests that further improvements in expected return (89% to 119% vs. current) or reduction in risk (22% to 35% vs. current) are available holding risk or expected return, respectively, constant, and that 28% to 89% greater decrease in average years-of-life-lost per unit risk may be achievable. However, these results also reflect the imprecision of YLL as a measure of disease burden, the noisy statistical link between basic research and YLL, and other known limitations of portfolio theory itself.
Conclusions: Our analysis is intended to serve as a proof-of-concept and starting point for applying quantitative methods to allocating biomedical research funding that are objective, systematic, transparent, repeatable, and expressly designed to reduce the burden of disease. By approaching funding decisions in a more analytical fashion, it may be possible to improve their ultimate outcomes while reducing unintended consequences.
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United States Registered Nurse Workforce Report Card and Shortage Forecast
Stephen Juraschek et al.
American Journal of Medical Quality, May/June 2012, Pages 241-249
Abstract:
Registered nurses (RNs) play a critical role in health care delivery. With an aging US population, health care demand is growing at an unprecedented pace. Using projected changes in population size and age, the authors developed demand and supply models to forecast the RN job shortage in each of the 50 states. Letter grades were assigned based on projected RN job shortage ratios. The number of states receiving a grade of "D" or "F" for their RN shortage ratio will increase from 5 in 2009 to 30 by 2030, for a total national deficit of 918 232 (725 619 - 1 112 112) RN jobs. There will be significant RN workforce shortages throughout the country in 2030; the western region will have the largest shortage ratio of 389 RN jobs per 100 000. Increased efforts to understand shortage dynamics are warranted.
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The relation between wealth and health: Evidence from a world panel of countries
Casper Worm Hansen
Economics Letters, May 2012, Pages 175-176
Abstract:
Based on a world sample of countries, this paper presents panel data evidence that documents a U-shaped relation between GDP per capita (wealth) and life expectancy (health). The evidence also shows that excluding the possibility of a nonmonotonic relationship induces erroneous conclusions about the time-varying wealth-health correlation.
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Gautier Duflos & Frank Lichtenberg
International Review of Law and Economics, March 2012, Pages 95-109
Abstract:
Microeconomic theory implies that the demand for prescription drugs should be inversely related to drug prices and directly related to marketing expenditure. Changes in market structure due to patent expiration or other factors is likely to reduce both the average price of a drug and marketing expenditure, so the effect of increased competition on total utilization of a drug is theoretically indeterminate. We use longitudinal, molecule-level data on virtually all prescription drugs sold during the period 2000-2004 to analyze the impact of changes in market structure (primarily resulting from patent expiration) on U.S. drug prices, marketing, and utilization. Price and marketing expenditure both decline by about 50-60% in the years immediately following generic entry, but the number of prescriptions remains essentially constant during those years. The two effects of increased competition on utilization - positive (via price), and negative (via marketing) - almost exactly offset one another, so the net effect of patent expiration on drug utilization is zero.
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Chyke Doubeni et al.
PLoS ONE, May 2012
Background: Low-socioeconomic status (SES) is associated with a higher colorectal cancer (CRC) incidence and mortality. Screening with colonoscopy, the most commonly used test in the US, has been shown to reduce the risk of death from CRC. This study examined if, among insured persons receiving care in integrated healthcare delivery systems, differences exist in colonoscopy use according to neighborhood SES.
Methods: We assembled a retrospective cohort of 100,566 men and women, 50-74 years old, who had been enrolled in one of three US health plans for ≥1 year on January 1, 2000. Subjects were followed until the date of first colonoscopy, date of disenrollment from the health plan, or December 31, 2007, whichever occurred first. We obtained data on colonoscopy use from administrative records. We defined screening colonoscopy as an examination that was not preceded by gastrointestinal conditions in the prior 6-month period. Neighborhood SES was measured using the percentage of households in each subject's census-tract with an income below 1999 federal poverty levels based on 2000 US census data. Analyses, adjusted for demographics and comorbidity index, were performed using Weibull regression models.
Results: The average age of the cohort was 60 years and 52.7% were female. During 449,738 person-years of follow-up, fewer subjects in the lowest SES quartile (Q1) compared to the highest quartile (Q4) had any colonoscopy (26.7% vs. 37.1%) or a screening colonoscopy (7.6% vs. 13.3%). In regression analyses, compared to Q4, subjects in Q1 were 16% (adjusted HR = 0.84, 95% CI: 0.80-0.88) less likely to undergo any colonoscopy and 30%(adjusted HR = 0.70, CI: 0.65-0.75) less likely to undergo a screening colonoscopy.
Conclusion: People in lower-SES neighborhoods are less likely to undergo a colonoscopy, even among insured subjects receiving care in integrated healthcare systems. Removing health insurance barriers alone is unlikely to eliminate disparities in colonoscopy use.
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Induced Innovation and Social Inequality: Evidence from Infant Medical Care
David Cutler, Ellen Meara & Seth Richards-Shubik
Journal of Human Resources, Spring 2012, Pages 456-492
Abstract:
We develop a model of induced innovation that applies to medical research. Our model yields three empirical predictions. First, initial death rates and subsequent research effort should be positively correlated. Second, research effort should be associated with more rapid mortality declines. Third, as a byproduct of targeting the most common conditions in the population as a whole, induced innovation leads to growth in mortality disparities between minority and majority groups. Using information on infant deaths in the United States between 1983 and 1998, we find support for all three empirical predictions.
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Carole Roan Gresenz et al.
Health Services Research, forthcoming
Objective: To analyze the effects of states' expansions of Children's Health Insurance Program (CHIP) eligibility to children in higher income families on health insurance coverage outcomes.
Data Sources: 2002-2009 Current Population Survey linked to multiple secondary data sources.
Study Design: Instrumental variables estimation of linear probability models. Outcomes are whether the child had any public insurance, any private insurance, or no insurance coverage during the year.
Principal Findings: Among children in families with incomes between two and four times the federal poverty line (FPL), four enrolled in CHIP for every 100 who became eligible. Roughly half of the newly eligible children who took up public insurance were previously uninsured. The upper bound "crowd-out" rate was estimated to be 46 percent.
Conclusions: The CHIP expansions to children in higher income families were associated with limited uptake of public coverage. Our results additionally suggest that there was crowd-out of private insurance coverage.
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Andrew Ryan, Jan Blustein & Lawrence Casalino
Health Affairs, April 2012, Pages 797-805
Abstract:
Medicare's flagship hospital pay-for-performance program, the Premier Hospital Quality Incentive Demonstration, began in 2003 but changed its incentive design in late 2006. The goals were to encourage greater quality improvement, particularly among lower-performing hospitals. However, we found no evidence that the change achieved these goals. Although the program changes were intended to provide strong incentives for improvement to the lowest-performing hospitals, we found that in practice the new incentive design resulted in the strongest incentives for hospitals that had already achieved quality performance ratings just above the median for the entire group of participating hospitals. Yet during the course of the program, these hospitals improved no more than others. Our findings raise questions about whether pay-for-performance strategies that reward improvement can generate greater improvement among lower performing providers. They also cast some doubt on the extent to which hospitals respond to the specific structure of economic incentives in pay-for-performance programs.
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The Hurrider I Go the Behinder I Get: The Deteriorating International Ranking of U.S. Health Status
Stephen Bezruchka
Annual Review of Public Health, 2012, Pages 157-173
Abstract:
The health of societies can be measured by a range of mortality indicators, and comparisons of national parameters with those of other societies can be symbolic of health status and progress. Over the past century, health outcomes have been steadily improving almost everywhere in the world, but the rates of improvements have varied. In the 1950s, the United States, having among the lowest mortality and other indicators of good health, ranked well among nations. Since then, the United States has not seen the scale of improvements in health outcomes enjoyed by most other developed countries, despite spending increasing amounts of its economy on health care services. Trends in personal health-related behaviors are only part of the explanation. Structural factors related to inequality and conditions of early life are important reasons for the relative stagnation in health. Reversing this relative decline would require a major national coordinated long-term effort to expose the problem and create the political will to address it.
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Hao Yu & Andrew Dick
Health Services Research, forthcoming
Background: Given the rapid growth of health care costs, some experts were concerned with erosion of employment-based private insurance (EBPI). This empirical analysis aims to quantify the concern.
Methods: Using the National Health Account, we generated a cost index to represent state-level annual cost growth. We merged it with the 1996-2003 Medical Expenditure Panel Survey. The unit of analysis is the family. We conducted both bivariate and multivariate logistic analyses.
Results: The bivariate analysis found a significant inverse association between the cost index and the proportion of families receiving an offer of EBPI. The multivariate analysis showed that the cost index was significantly negatively associated with the likelihood of receiving an EBPI offer for the entire sample and for families in the first, second, and third quartiles of income distribution. The cost index was also significantly negatively associated with the proportion of families with EBPI for the entire year for each family member (EBPI-EYEM). The multivariate analysis confirmed significance of the relationship for the entire sample, and for families in the second and third quartiles of income distribution. Among the families with EBPI-EYEM, there was a positive relationship between the cost index and this group's likelihood of having out-of-pocket expenditures exceeding 10 percent of family income. The multivariate analysis confirmed significance of the relationship for the entire group and for families in the second and third quartiles of income distribution.
Conclusions: Rising health costs reduce EBPI availability and enrollment, and the financial protection provided by it, especially for middle-class families.
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The Dynamics of Income-Related Health Inequality among American Children
Pinka Chatterji, Kajal Lahiri & Jingya Song
Health Economics, forthcoming
Abstract:
We estimate and decompose income-related inequality in child health in the USA and analyze its dynamics using the recently introduced health mobility index. Data come from the 1997, 2002, and 2007 waves of the Child Development Supplement of the Panel Study of Income Dynamics. The findings show that income-related child health inequality remains stable as children grow up and enter adolescence. The main factor underlying income-related child health inequality is income itself, although other factors, such as maternal education, also play a role. Decomposition of income-related health mobility indicates that health changes over time are more favorable to children with lower initial family incomes versus children with higher initial family incomes. However, offsetting this effect, our findings also suggest that changes in income ranking over time are positively related to children's subsequent health status.
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Is There "Too Much" Inequality in Health Spending Across Income Groups?
Laurence Ales, Roozbeh Hosseini & Larry Jones
NBER Working Paper, March 2012
Abstract:
In this paper we study the efficient allocation of health resources across individuals. We focus on the relation between health resources and income (taken as a proxy for productivity). In particular we determine the efficient level of the health care social safety net for the indigent. We assume that individuals have different life cycle profiles of productivity. Health care increases survival probability. We adopt the classical approach of welfare economics by considering how a central planner with an egalitarian (ex-ante) perspective would allocate resources. We show that, under the efficient allocation, health care spending increases with labor productivity, but only during the working years. Post retirement, everyone would get the same health care. Quantitatively, we find that the amount of inequality across the income distribution in the data is larger that what would be justified solely on the basis of production efficiency, but not drastically so. As a rough summary, in U.S. data top to bottom spending ratios are about 1.5 for most of the life cycle. Efficiency implies a decline from about 2 (at age 25) to 1 at retirement. We find larger inefficiencies in the lower part of the income distribution and in post retirement ages.
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Cross-State Disparities in US Health Care Expenditures
Ekaterini Panopoulou & Theologos Pantelidis
Health Economics, forthcoming
Abstract:
This study examines the degree of convergence in health care expenditures among the US states from 1980 to 2004. Our results suggest that the US states form two clubs with specific geographical characteristics that converge to different equilibria. We also extend our analysis to investigate the cross-state disparities in nine major components of health expenditures. Our findings provide evidence for full convergence for only two components, namely ‘physician and other professional services' and ‘home health care'. However, for the remaining components, we can still identify various convergence clubs.
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The Impact of Health Information Technology on Hospital Productivity
Jinhyung Lee, Jeffery McCullough & Robert Town
NBER Working Paper, April 2012
Abstract:
The US health care sector is, by most accounts, extraordinarily inefficient. Health information technology (IT) has been championed as a tool that can transform health care delivery. Recently, the federal government has taken an active role in promoting health IT diffusion. There is little systematic analysis of the causal impact of health IT on productivity or whether private and public returns to health IT diverge thereby justifying government intervention. We estimate the parameters of a value-added hospital production function correcting for endogenous input choices in order to assess the private returns hospitals earn from health IT. Despite high marginal products, the potential benefits from expanded IT adoption are modest. Over the span of our data, health IT inputs increased by more than 210% and contributed about 6% to the increase in value-added. Virtually all the increase in value-added is attributable to the increased use of inputs{there was little change in hospital multi-factor productivity. Not-for-profits invested more heavily and differently in IT than for-profit hospitals. Finally, we find no evidence of labor complementarities or network externalities from health IT.
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The health care access and utilization of homeschooled children in the United States
Alissa Cordner
Social Science & Medicine, forthcoming
Abstract:
Although the population of homeschooled children in the United States is large and growing, little is known about their access to and utilization of preventive health care services. This paper compares the health care access and utilization of homeschooled children and public school children in the United States using data from the nationally representative 2007 National Survey of Children's Health. Using logistic regression models, this study finds that homeschooled children were significantly less likely than public school children to have access to a medical home, to visit a health care professional annually, and to receive the Human Papillomavirus vaccine. They were not statistically less likely to have health insurance, to receive annual dental care, or to receive Tetanus or Meningitis vaccinations. This research suggests that public health practitioners, medical providers, researchers, and educators should be attentive to the health care needs of homeschooled children.
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John Gettens, Alexis Henry & Jay Himmelstein
Journal of Disability Policy Studies, June 2012, Pages 3-13
Abstract:
The changes enacted by the Patient Protection and Affordable Care Act are designed to substantially increase health insurance coverage. The authors analyze the health care reforms to assess the potential for increased insurance coverage among persons with disabilities. They estimate that approximately 2 million persons with disabilities will be newly insured; however, they also find a probable unintended consequence of the health care reforms: that some persons with disabilities will lose their current Medicaid coverage. The article outlines policy changes that would prevent this unintended consequence before full implementation of the changes in 2014.