nep-hea New Economics Papers
on Health Economics
Issue of 2006‒05‒20
nine papers chosen by
Yong Yin
SUNY at Buffalo, USA

  1. Assessing the impact of illness, caring and ethnicity on social activity By Lucinda Platt
  2. Understanding socio-economic inequalities in childhood respiratory health By Carol Propper; John A. Rigg
  3. Disability and Work: the Role of Health Shocks and Childhood Circumstances By Maarten Lindeboom; Ana Llena Nozal; Bas van der Klaauw
  4. Perception of Own Death Risk: An Analysis of Road-Traffic and Overall Mortality Risks By Andersson, Henrik; Lundborg, Petter
  5. Persistence of innovation, technological change and quality-adjusted patents in the US pharmaceutical industry. By Gautier Duflos
  6. Medicaid Policy Changes in Mental Health Care and Their Effect on Mental Health Outcomes By Alison Cuellar; Sara Markowitz
  7. Hospital Ownership and Quality of Care: What Explains the Different Results? By Karen Eggleston; Yu-Chu Shen; Joseph Lau; Christopher H. Schmid; Jia Chan
  8. The Welfare Consequences of Hospital Mergers By Robert Town; Douglas Wholey; Roger Feldman; Lawton R. Burns
  9. Behavioral Differences Between Public and Private Not-For-Profit Hospitals in the Italian National Health Service By Gian Paolo Barbetta; Gilberto Turati; Angelo Zago

  1. By: Lucinda Platt
    Abstract: It has long been accepted that lack of social participation in wider society is one aspect or one definition of poverty. Current concerns with the extent and distribution of social capital as both a measure of a good society and as means to upward mobility also emphasise the importance of social contacts and networks to the well-being of individuals and communities. While research has often focused on 'civic participation' and the measurement of trust, more informal social bonds are also a crucial part of individuals' social capital. Moreover, informal social capital or social participation might be particularly important for those whose circumstances make them already more vulnerable to marginalisation, exclusion or poverty. For example, social interaction has been argued to be conducive to better outcomes for those with health problems; and there is an extensive literature which aims to chart and explain the role of 'ethnic capital' in the life chances of minority ethnic groups. I use the British Home Office Citizenship Survey 2001 for England and Wales to explore the impact on four aspects of lack of social engagement of long-term illness, caring for someone with such an illness, and ethnicity. Controlling for a range of characteristics and examining the relationships separately for men and women there is evidence that between them, the four measures reveal an underlying propensity for reduced social contact. Other things being equal, illness has little association with reduced social participation, but caring does seem to affect opportunities for sociability. Members of some ethnic groups are less likely to engage in neighbourly social visiting than others, and these differences are little affected by income level. By contrast differences in 'going out' across groups can largely be explained by differences in income. Overall, social engagement among male Bangladeshis and to a lesser extent Pakistanis is high, whereas Black Africans and Black Caribbeans, especially women, are notable for their lack of opportunities for social engagement compared with their otherwise similar peers. They would appear to be particularly at risk of social isolation, with consequences for their current and future welfare.
    Keywords: long-term illness, caring, ethnic group, social engagement, social capital
    JEL: I31
    Date: 2006–03
  2. By: Carol Propper; John A. Rigg
    Abstract: Asthma is the most common chronic disease of childhood. Recent evidence has shown a socio-economic gradient in its distribution. This paper examines whether a number of factors argued to have led to a rise in the incidence of asthma might also explain the social gradient. Several of these have been the object of policy intervention, though not necessarily with the aim of lowering childhood respiratory conditions. Using a large cohort study (the Avon Longitudinal Study of Parents and Children) we find significant inequalities in three respiratory conditions in middle childhood. We investigate eight potential mediating factors: exposure to other children in infancy, child's diet, poor housing conditions, maternal smoking, parental history of asthma, poor child health at birth, maternal age at child's birth and local deprivation. We find that each of these alone typically explains a relatively modest part of each respiratory inequality, with child's diet, local deprivation and maternal smoking generally the most important. But taken together, the mediating factors account for a substantial part of the respiratory inequalities. So the socio-economic gradient appears to operate through a number of inter-correlated pathways, some of which may be amenable to policy intervention.
    Keywords: Asthma, wheeze, socio-economic inequalities, mediating
    JEL: I1
    Date: 2006–03
  3. By: Maarten Lindeboom (Vrije Universiteit); Ana Llena Nozal (Vrije Universiteit); Bas van der Klaauw (Vrije Universiteit Amsterdam)
    Abstract: This paper focuses on the relation between the onset of disability and employment outcomes. We develop an event history model that includes unscheduled hospitalizations as a measure for unanticipated health shocks and estimate the model on data from the British National Child Development Study (NCDS). We show that such health shocks increase the likelihood of an onset of a disability by around 138%. However, health shocks are relatively rare events and therefore the larger part of observed disability rates result from gradual deteriorations in health. We find no direct effect of health shocks on employment outcomes. Using the health shock as an instrumental variable shows that the onset of a disability at age 25 causally reduces the employment rate at age 40 with around 21 percentage points. Our results show that early childhood conditions are important in explaining adult health and socioeconomic outcomes. Those who have experienced bad conditions during! early childhood have higher rates of health deterioration during adulthood, are more likely to become non-employed and suffer from longer spells of non-employment during the course of life.
    Keywords: Disability; employment; early childhood conditions; health shocks; causality
    JEL: I12 J28
    Date: 2006–04–21
  4. By: Andersson, Henrik (VTI); Lundborg, Petter (LUCHE)
    Abstract: Individuals' perception of their own road-traffic and overall mortality risks are examined in this paper. Perceived risk is compared with the objective risk of the respondents' peers, i.e. their own gender and age group, and the results suggest that individuals' risk perception of their own risk is biased. For road-traffic risk we obtain similar results to what have been found previously in the literature, overassessment and underassessment among low- and high-risk groups, respectively. For overall risk we find that all risk groups underestimate their risk. The results also indicate that men's risk bias is larger than women's.
    Keywords: Bayesian learning; Overall risk; Peers; Road-traffic risk
    JEL: C21 D81 D83 I18
    Date: 2006–03–14
  5. By: Gautier Duflos (Centre d'Economie de la Sorbonne et CREST-LEI)
    Abstract: This paper analyzes American pharmaceutical firms' persistence in innovating just before the wave of mergers and acquisitions that accompanied the "Biotech revolution". We evaluate the impact of past innovative activity on firms' innovation propensities using a non-linear GMM estimator for exponential models that allows for predetermined regressors and linear feedback. We find that innovative activity at the firm level depends strongly on the scope of past innovations. Breakthroughs in particular depend largely on past quality innovation made by firms, and this effect may likely deter further pioneering discoveries rather than strengthen incentives to invest on non cumulative R&D. The results also shed light on the importance of small firms in the dynamics of innovation in pharmaceutical industry, and suggest that large firms persist in using patents strategically to remain dominant.
    Keywords: Patent citations, pharmaceutical industry, persistence in innovation.
    JEL: O31 L12 C23
    Date: 2006–01
  6. By: Alison Cuellar; Sara Markowitz
    Abstract: In recent years, Medicaid has experienced a dramatic increase in spending on prescription drugs in general and psychotropic medications in particular. The purpose of this study is to examine the effects of increased Medicaid spending on psychotropic drugs on improving the mental health and well-being of participants at the population level. Specifically, we study the effect on outcomes that are strongly correlated with mood disorders, including depression, and Attention Deficit/Hyperactivity disorder, controlling for concomitant increases in Medicaid eligibility thresholds and expansion into managed care for mental health services. Knowledge of the effects of changes in the Medicaid program is crucial to policymakers as they consider implementing and expanding mental health services. Our results show that increased spending on antidepressants and stimulants are associated with improvements in some outcomes, but not in others.
    JEL: I0
    Date: 2006–05
  7. By: Karen Eggleston; Yu-Chu Shen; Joseph Lau; Christopher H. Schmid; Jia Chan
    Abstract: Does quality of care systematically differ among government-owned, private not-for-profit, and for-profit hospitals? A large empirical literature provides conflicting evidence. Through quantitative review of 46 studies since 1990, we find that several study features that can explain divergent results: analytic methods, disease studied, and data sources. For unprofitable care, how studies handle market competition and regional differences account for substantial variation. Policymakers should be aware that differences in results appear to arise predominantly from differences between studies’ analytic methods. Moreover, conventional methods of meta-analytic synthesis should be applied with great caution given the considerable overlap among studied hospitals.
    JEL: I1
    Date: 2006–05
  8. By: Robert Town; Douglas Wholey; Roger Feldman; Lawton R. Burns
    Abstract: In the 1990s the US hospital industry consolidated. This paper estimates the impact of the wave of hospital mergers on welfare focusing on the impact on consumer surplus for the under-65 population. For the purposes of quantifying the price impact of consolidations, hospitals are modeled as an input to the production of health insurance for the under-65 population. The estimates indicate that the aggregate magnitude of the impact of hospital mergers is modest but not trivial. In 2001, average HMO premiums are estimated to be 3.2% higher than they would have been absent any hospital merger activity during the 1990s. In 2003, we estimate that because of hospital mergers private insurance rolls declined by approximately .3 percentage points or approximately 695,000 lives with the vast majority of those who lost private insurance joining the ranks of the uninsured. Our estimates imply that hospital mergers resulted in a cumulative consumer surplus loss of over $42.2 billion between 1990 and 2001. It is estimated that all but a modest $95.4 million of the loss in consumer surplus is transferred from consumers to providers.
    JEL: I11 L11 L41
    Date: 2006–05
  9. By: Gian Paolo Barbetta (Istituto di Economia e Finanza (Univ. Cattolica MI); Gilberto Turati (Dipartimento di Scienze economiche e Finanziarie); Angelo Zago (Dipartimento di Scienze economiche)
    Abstract: In this paper we attempt to identify behavioral differences between public and private not-forprofit hospitals, by using the opportunity of the introduction of the DRG-based payment system in the Italian NHS during the second half of the Nineties. We estimate the technical efficiency of a sample of hospitals for the period 1995-2000 considering an output distance function, and adopting both parametric (COLS) and non-parametric (DEA) approaches. All our results show a convergence of mean efficiency scores between not-for-profit and public hospitals, and seem to suggest that differences in economic performances between competing ownership forms are more the result of the institutional settings in which they operate than the effect of the incentive structures embedded in the different proprietary forms. Contrary to expectation we also observe a decline in technical efficiency, probably due to policies aimed at reducing hospitalization rates.
    Keywords: forms, technical efficiency, nonprofit organizations, hospital behavior, payment systems.
    JEL: I11 I18 L31
    Date: 2004–10

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