nep-hea New Economics Papers
on Health Economics
Issue of 2008‒09‒29
thirty papers chosen by
Yong Yin
SUNY at Buffalo, USA

  1. Forecasting the Cost of U.S. Health Care in 2040 By Robert W. Fogel
  2. Livelihood Risk from HIV in Semi-Arid Tropics of Rural Andhra Pradesh By B, Valentine Joseph Gandhi; M, Cynthia Serquina Bantilan; D , Parthasarathy
  3. Individual and Collective Resources and Health in Morocco By Martin, Marie-Claude
  4. A Dynamic Analysis of the Demand for Health Insurance and Health Care By Bolhaar, Jonneke; Lindeboom, Maarten; van der Klaauw, Bas
  5. Do interactions between unemployment insurance and sickness insurance affect transitions to employment? By Hall, Caroline
  6. The Determinants of Child Weight and Height in Sri Lanka: A Quantile Regression Approach By Aturupane, Harsha; Deolalikar, Anil B.; Gunewardena, Dileni
  7. Roy Model Sorting and Non-Random Selection in the Valuation of a Statistical Life By Thomas DeLeire; Christopher Timmins
  8. Employment-Based Health Insurance and the Minimum Wage By Laura Bucila
  9. The Effect of Activity-Based Payment on Dentists’ Activity: Evidence from a Natural Experiment in the UK National Health Service By Martin Chalkley; Colin Tilley; Linda Young; Debbie Bonnetti; Jan Clarkson
  10. Technical efficiency in primary health care: does quality matter? By Murillo-Zamorano, Luis R.; Petraglia, C.
  11. Convergence of per capita health care expenditures in OECD Countries By Aslan, Alper
  12. Health Indexes and Retirement Modeling in International Comparisons By Erik Meijer; Arie Kapteyn; Tatiana Andreyeva
  13. Feminization of Ageing and Long Term Care Financing in Singapore By Chia Ngee Choon; Shawna Lim Shi en; Angelique Chan
  14. Dementia Care Mapping and Patient-Centred Care in Australian residential homes: An economic evaluation of the CARE Study, CHERE Working Paper 2008/4 By Richard Norman; Marion Haas; Lyn Chenoweth; Yun-Hee Jeon; Madeleine King; Henry Brodaty; Jane Stein-Parbury; Georgina Luscombe
  15. Inequity in Publicly Funded Physician Care: What Is The Role Of Private Prescription Drug Insurance? By Sara Allin; Jeremiah Hurley
  16. Uncovering the Effect of the HIV Epidemic on Fertility in Sub-Saharan Africa: The Case of Malawi By Durevall, Dick; Lindskog, Annika
  17. Demanding Customers: Consumerist Patients and Quality of Care By Hai Fang; Nolan H. Miller; John A. Rizzo; Richard J. Zeckhauser
  18. Recruitment and retention incentives in health labour markets: an analysis of participation in NHS Scotland following Dental Vocational Training By Martin Chalkley; J. S. Rennie; Colin Tilley
  19. Discrete Heterogeneity in the Impact of Health Shocks on Labour Market Outcomes By Stefanie Schurer
  20. Geographic Equity in Hospital Utilization: Canadian Evidence Using a Concentration-Index Approach By Jeremiah Hurley; Michel Grignon; Li Wang; Tara McGrath
  21. Drug price setting and regulation in France By Nathalie Grandfils
  22. The Influence of the Business Cycle on Mortality By Wolfgang H. Reichmuth; Samad Sarferaz
  23. Adverse Selection and Career Outcomes in the Ethiopian Physician Labor Market By Joost de Laat; William Jack
  24. Livelihood Risk from HIV in Semi-Arid Tropics of Rural Andhra Pradesh By Gandhi, B. Valentine Joseph; Bantilan, M. Cynthia Serquina; Parthasarathy, Devanathan
  25. Fetal Exposure to Toxic Releases and Infant Health By Janet Currie; Johannes F. Schmieder
  26. Regulation of Private Health Insurance Premiums: Can Performance Assessment Play a Greater Role? By Roger Carrington; Tim Coelli; D. S. Prasada Rao
  27. How Macroeconomic Instability Lowers Child Survival By Guillaumont, Patrick; Korachais, Catherine; Subervie, Julie
  28. Comparability of Health Care Responsiveness in Europe using anchoring vignettes from SHARE By Nicolas Sirven; Brigitte Santos-Eggimann; Jacques Spagnoli
  29. Impact of health care system on socioeconomic inequalities in doctor use By Zeynep Or; Florence Jusot; Engin Yilmaz
  30. Differential Mortality in Europe and the U.S.: Estimates Based on Subjective Probabilities of Survival By Adeline Delavande; Susann Rohwedder

  1. By: Robert W. Fogel
    Abstract: One of the most important debates among health economists in rich nations is whether advances in biotechnology will spare their health care systems from a financial crisis. We must consider that prevalence rates of chronic diseases declined during the twentieth century and that this rate of decline has accelerated. However, health care costs may continue to increase even as the age of onset of chronic diseases is delayed, because the proportion of a cohort living to late ages will increase. The accelerating decline in the prevalence of chronic diseases during the course of the twentieth century supports the proposition that increases in life expectancy during the twenty-first century will be fairly large, but the effect on health care in the U.S. will be modest. The income elasticity for health services is calculated at 1.6, meaning that income expenditures on health care in the U.S. are likely to rise from a current level of about 15 percent to about 29 percent of GDP in 2040.
    JEL: I11
    Date: 2008–09
  2. By: B, Valentine Joseph Gandhi; M, Cynthia Serquina Bantilan; D , Parthasarathy
    Abstract: This paper discusses the livelihood dynamics in the fragile landscape of the semi-arid tropics (SAT) of Andhra Pradesh. SAT is home to the poorest of the poor who live in conditions of persistent drought, subsistence agriculture and poor access to markets. This paper is a case study focusing particularly on labour migration, its role in influencing the health risk behaviour of migrants and in the spread of the HIV epidemic among SAT rural households. The most vulnerable population in these drought prone regions are the migrant labourers, and their vulnerability is influenced by three major factors—the vulnerability and unstable productivity in the degraded and marginal landscape, the caste system that has traditionally kept them backward and vulnerable, and experiences in the external environment to which they migrate. This study is based on a theoretical framework, whereby livelihood risks lead to health risks, particularly HIV infection—outlines the process that causes a further deterioration of the household and the occurrence of cyclical health risk. The paper calls for a multisectoral approach to tackle the issue of migrant vulnerability, and for interventions with a more migrant-need sensitive approach.
    JEL: Q19 I19 O15
    Date: 2008–04
  3. By: Martin, Marie-Claude
    Abstract: The interaction between available individual and collective resources in the determination of health is largely ignored in the literature on the relationship between poverty and health in developing countries. We analyse the role public resources play in the perception that rural women in Morocco have of their health. These resources are taken to contribute directly and indirectly to the improvement of individual health by, on the one hand, providing a health-promoting environment and, on the other, improving the individual?s ability to produce health. The empirical results of multilevel models confirm the expected associations between socioeconomic status, individual vulnerability factors and health. Furthermore, the random part of the model suggests that variation in state of health is also associated with the presence of collective resources. However, the higher the level of women?s individual wealth, the less the characteristics of the community in which they live seem to be associated with their health, and the less the potential vulnerability factors seem to constrain their ability to maintain or improve health. Our results suggest that collective investments derived from various areas of activity will be more favourable to improving health, insofar as they are adapted to the initial capacity of women to benefit from them.
    Keywords: health, poverty, rural, women, Morocco
    Date: 2008
  4. By: Bolhaar, Jonneke (Free University of Amsterdam); Lindeboom, Maarten (Free University of Amsterdam); van der Klaauw, Bas (Free University of Amsterdam)
    Abstract: We investigate the presence of moral hazard and advantageous or adverse selection in a market for supplementary health insurance. For this we specify and estimate dynamic models for health insurance decisions and health care utilization. Estimates of the health care utilization models indicate that moral hazard is not important. Furthermore, we find strong evidence for advantageous selection, largely driven by heterogeneity in education, income and health preferences. Finally, we show that ignoring dynamics and unobserved fixed effects changes the results dramatically.
    Keywords: supplementary private health insurance, health care utilization, advantageous selection, moral hazard, panel data
    JEL: I11 D82 G22 C33
    Date: 2008–09
  5. By: Hall, Caroline (IFAU - Institute for Labour Market Policy Evaluation)
    Abstract: Previous research suggests that there are substantial interactions between the unemployment insurance (UI) and the sickness insurance (SI) in Sweden. Moral hazard arises in the interplay between these two social insurance systems, since by reporting sick an unemployed person can postpone the UI expiration date and sometimes also receive considerably higher benefits. This paper examines whether these interactions affect the transition rate from unemployment to employment. To study this question I utilize a reform which greatly reduced the incentives for unemployed persons to transfer to the SI. While there is evidence that this reform substantially lowered the incidence of sick reports among the unemployed, I find no evidence suggesting that the reduced sick report rate in turn affected the transition rate to employment
    Keywords: Unemployment insurance; sickness insurance; unemployment duration; health; duration analysis
    JEL: C41 H55 I18 J64 J65
    Date: 2008–09–03
  6. By: Aturupane, Harsha; Deolalikar, Anil B.; Gunewardena, Dileni
    Abstract: Reducing child malnutrition is a key goal of most developing countries. To combat child malnutrition with the right set of interventions, policymakers need to have a better understanding of its economic, social and policy determinants. While there is a large literature that investigates the determinants of child malnutrition, it focuses almost exclusively on mean effects of these determinants. However, socioeconomic background variables and policy interventions may affect child nutrition differently at different points of the conditional nutritional distribution. Using quantile regressions, this paper explores the effects of variables such as a child?s age, sex and birth order; household expenditure per capita; parental schooling; and infrastructure on child weight and height at different points of the conditional distributions of weight and height using data from Sri Lanka?s Demographic and Health Survey. Results indicate that OLS estimates can be misleading in predicting the effects of determinants at the lower end of the distributions of weight and height. For example, even though on average Sri Lankan girls are not nutritionally-disadvantaged relative to boys, among children at the highest risk of malnutrition girls are disadvantaged relative to boys. Likewise, although expenditure per capita is associated with strong nutritional improvement on average, it is not a significant determinant of child height or weight at the lower end of the distribution. Similarly, parental education, electricity access, and the availability of piped water have larger effects on child weight and height at the upper quantiles than at the lower quantiles. The policy implication is that general interventions?parental schooling, infrastructure and income growth?are not as effective for children in the lower tail of the conditional weight and height distributions. These children, who are at the highest risk of malnutrition, are likely to need specialized nutritional interventions.
    Keywords: child health, child nutrition, malnutrition, child weight, child height, quantile regression, Sri Lanka
    Date: 2008
  7. By: Thomas DeLeire; Christopher Timmins
    Abstract: Wage-hedonics is used to recover the value of a statistical life by exploiting the fact that workers choosing riskier occupations will be compensated with a higher wage. However, Roy (1951) suggests that observed wage distributions will be distorted if individuals select into jobs according to idiosyncratic returns. We illustrate how this type of sorting may bias wage-hedonic VSL estimates and describe two estimators that correct for it. Using data from the CPS, we recover VSL estimates that are three to four times larger than those based on the traditional techniques, statistically significant, and robust to a wide array of specifications.
    JEL: J17 J31 Q5 Q51
    Date: 2008–09
  8. By: Laura Bucila (Department of Economics, College of the Holy Cross)
    Abstract: This paper provides new estimates of the effects of increased federal and state minimum wages on the employment-based health insurance coverage of low-wage workers. I use March Current Population Surveys collected from IPUMS, for 1988 to 2005. Previous studies have found no significant evidence that increased minimum wages reduce fringe benefit receipt (Beeson Royalty 2000; Simon and Kaestner 2003). In contrast to these studies, I use a difference-in-difference approach and I define treatment groups as being individuals in the lowest 1 and 2 deciles of the hourly wage distribution. Little evidence was found for the federal minimum wage increase of 1990-91, but estimates of the effect of the 1996-97 increase suggest a small negative impact for younger workers and workers in smaller firms. At the state level, I find more suggestive results of a negative impact of the minimum wage increases. New Jersey (1992) and Massachusetts (2000-2001) exhibit negative effects of being in the treatment group on the probability of having employment-based health insurance for most of the specifications, while the results in Oregon (1991) and Connecticut (2000-2001) are more sensitive to the specification. The results suggest that being in the treatment group makes individuals 3 to 4 percentage points less likely to be policyholders of employment-based health insurance compared to the control group.
    Keywords: Minimum Wage, Fringe Benefits
    JEL: J32 J33
    Date: 2008–09
  9. By: Martin Chalkley; Colin Tilley; Linda Young; Debbie Bonnetti; Jan Clarkson
    Abstract: The extent to which remuneration systems affect the behaviour of health care professionals is of considerable importance in the administration of publicly funded heath care systems. Using data across two jurisdictions in the United Kingdom, in only one of which remuneration was changed, we compare the extent of measured dental activity at the dentist level in order to ascertain the impact of moving to activity-based remuneration. We find that there are large and statistically significant increases in activity as dentists moved to the activity-based system and that a dentist’s previous form of contract is an important determinant of the magnitude of the effect. We also explore the extent to which dentists’ professional attitudes can explain differences in their activity and find that some aspects of self-reported attitudes are associated with observable differences in activity.
    Date: 2008–08
  10. By: Murillo-Zamorano, Luis R.; Petraglia, C.
    Abstract: The accuracy required in the measurement of output is an issue that has as yet still not been satisfactorily addressed in empirical research on efficiency in primary health care. We exploit information retrieved from a newly constructed database (APEX06) for the Spanish region of Extremadura. The richness of our dataset allows us to consider original synthetic measures of output that take into account both the quantity and the quality of services provided by 85 primary care centres (PCCs) in 2006. We provide evidence that neglecting the issue of properly accounting for the quality of health services can lead to misleading results. Our main finding is that adjusting output for quality influences efficiency analysis in three senses. First, inefficiency now explains relatively more of the deviation from the potential output. Second, the average technical efficiency in the sector is lower, while its dispersion among PCCs is significantly higher. And third, the efficiency ranking of the PCCs is also affected.
    Keywords: Primary Health Care; Stochastic Frontier Analysis; Technical Efficiency; Quality
    JEL: C10 I10
    Date: 2008–09
  11. By: Aslan, Alper
    Abstract: In this article it is investigated the convergence of health care expenditures per capita in OECD during the 1970–2005 period by applying Lima and Resende (2007) persistence methodology. Departures across countries were evaluated in terms of panel data unit root tests advanced by Im et al. (2003). The evidence illustrated that one cannot reject the null hypothesis of unit root for the (log) of the ratio of health care expenditures of each country relative to a reference unit except average of per capita health expenditures The results, therefore, favour a very strong form of persistence for OECD expenditures inequality.
    JEL: H51
    Date: 2008
  12. By: Erik Meijer; Arie Kapteyn; Tatiana Andreyeva
    Abstract: It is widely believed that health plays a major role in retirement decisions. The most important problem in including health in retirement models is the lack of availability of a good measure of health at the individual level in existing data sets. This problem is exacerbated when a model spanning multiple countries is desired, because self-reports on health may not be comparable across countries. Arguably, physical measures are less influenced by cultural and linguistic differences than self-reports on general health or even on health conditions. The authors develop a cross-country measurement model for health in which the relations between functional limitations, self-reports, and physical measures like grip strength are used to construct health indexes. Comparability across countries is achieved by using the physical measurements to define the measurement scales, and allowing other parameters to vary across countries to account for cultural and linguistic differences in response patterns. The usefulness of the health indexes is then investigated by including it in some simple retirement models.
    JEL: I19 J26 C81 C35
    Date: 2008–08
  13. By: Chia Ngee Choon (Department of Economics, National University of Singapore); Shawna Lim Shi en (Department of Economics, National University of Singapore); Angelique Chan (Department of Sociology, National University of Singapore)
    Abstract: Feminization of ageing leads to issues relating to long term healthcare financing since females are more susceptible to chronic illnesses. This paper assesses the current provision of long-term care (LTC) in Singapore by first examining the health status of elderly female; and then estimates the present value of LTC expenses. We calibrate the LTC costs for institutional nursing homes, community homes and informal home-based care with domestic helper. We next evaluate the comprehensiveness of a private disability insurance scheme in Singapore (Eldershield) in capturing the expected share of LTC expenditures. We compare the policy comprehensiveness of Eldershield payouts for different utilizations of LTC at different levels of means-tested government subsidies. With subsidies, the LTC cost can be adequately covered by Eldershield; without any subsidies, Eldershield is able to capture 25% to 40% of the LTC costs. We also evaluate the LTC financing implications after an osteoporotic hip fracture surgery.
    Keywords: health financing, long-term care, ageing, disability insurance, policy comprehensiveness
    JEL: H51 I11 J14
    Date: 2008–09–08
  14. By: Richard Norman (CHERE, University of Technology, Sydney); Marion Haas (CHERE, University of Technology, Sydney); Lyn Chenoweth; Yun-Hee Jeon; Madeleine King; Henry Brodaty; Jane Stein-Parbury; Georgina Luscombe
    Abstract: Background: As the population ages, the incidence of dementia and its burden on society will increase. The economic costs of dementia are high, particularly for persons in the mid and late stages of the disease, when formal care arrangements such as nursing home placement are required. The need for care is often precipitated by the development of behavioural and psychological symptoms of dementia (BPSD) which also severely affect the quality of life of affected persons and their carers The Caring for Aged-Care REsident Study (CARES), the first randomised controlled trial to evaluate Dementia Care Mapping (DCM) and Person Centred Care (PCC), demonstrated that either of the two interventions improved outcomes compared to Usual Care (UC) on the primary outcome measure, the Cohen-Mansfield Agitation Inventory (CMAI). This study reports the results of an economic evaluation which was undertaken in conjunction with the trial. This information will provide additional information to assist policy makers in making choices between competing options. Methods: Fifteen nursing homes were randomised to one of three conditions: DCM, PCC or Usual Care (UC). The sample consisted of 360 residents with dementia. Data were collected at baseline, three months, and eight months by assessors blind to group assignment. In addition to the CMAI, data were collected about the use and costs of health care resources and pharmacological interventions. Total costs associated with each of the interventions were estimated, which were contrasted with the outcomes using standard health economics methodology. Results: Over one year, the cost per residential setting of implementing DCM and PCC relative to UC was $10,034 and $2,250 respectively. The additional cost per resident-level unit improvement in CMAI post-intervention (at follow-up) relative to UC was $48.95 ($46.89) for DCM and $8.01 ($6.43) for PCC. Compared to DCM, PCC produced a greater reduction in anxiety and agitation at a lower cost. Therefore, DCM was dominated by PCC and removed from the economic evaluation. Sensitivity analysis suggests this result is robust to changing model parameters. Conclusions: PCC provides a greater decrease in agitation and related behavioural and psychological symptoms of dementia, compared with DCM, at a lower cost and is the preferred option for cost-effectiveness. While there is no existing standard for a reasonable cost for a point improvement in CMAI, the cost per unit under PCC seems acceptable.
    Keywords: Dementia, patient centred care
    JEL: I10
    Date: 2008–06
  15. By: Sara Allin (LSE Health, London School of Economics and Political Science); Jeremiah Hurley (Department of Economics and Centre for Health Economics and Policy Analysis, McMaster University)
    Abstract: This study examines the impact that private financing of prescription drugs in Canada has on equity in the utilization of publicly financed physician services. The complementary nature of prescription drugs and physician service use alongside the reliance on private finance for drugs may induce an income gradient in the use of physicians. We use established econometric methods based on concentration curves to measure equity in physician utilization and its contributors in the province of Ontario. We find that individuals with prescription drug insurance make more physician visits than do those without insurance, and the effect on utilization is stronger for the likelihood of a visit than the conditional number of visits, and for individuals with no chronic conditions than those with at least one condition. Results of the equity analyses reveal the most important contributors to the pro-rich inequity in physician utilization are income and private insurance, while public insurance, which covers older people and those on social assistance, has a pro-poor effect. These findings highlight that inequity in access to and use of publicly funded services may arise from the interaction with privately financed health services that are complements to the use of public services.
    Keywords: equity, private insurance, prescription drugs, physician utilization
    Date: 2008
  16. By: Durevall, Dick (Department of Economics, School of Business, Economics and Law, Göteborg University); Lindskog, Annika (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: In many Sub-Saharan countries the HIV epidemic has spread to over 10% of the working-age population, and is likely to affect economically relevant behaviour. We evaluate the impact of the HIV/AIDS epidemic on the reproductive behaviour for women in Malawi, allowing for a heterogeneous response depending on age and prior number of births. HIV/AIDS increases the probability that a young woman would give birth to her first child, while it decreases the probability to give birth of older women or of young women who have already given birth. The resulting change in the distribution of fertility across age-groups is likely to be more demographically and economically important than changes in the total number of children a woman gives birth to.
    Keywords: HIV; Fertility; Malawi; Panel-data logit
    JEL: I19 J13 O12
    Date: 2008–09–16
  17. By: Hai Fang; Nolan H. Miller; John A. Rizzo; Richard J. Zeckhauser
    Abstract: Consumerism arises when patients acquire and use medical information from sources apart from their physicians, such as the Internet and direct-to-patient advertising. Consumerism has been hailed as a means of improving quality. This need not be the result. Consumerist patients place additional demands on their doctors' time, thus imposing a negative externality on other patients. Our theoretical model has the physician treat both consumerist and ordinary patient under a binding time budget. Relative to a world in which consumerism does not exist, consumerism is never Pareto improving, and in some cases harms both consumerist and ordinary patients. Data from a large national survey of physicians shows that high levels of consumerism are associated with lower perceived quality. Three different measures of quality were employed. The analysis uses instrumental variables to control for the endogeneity of consumerism. A control function approach is employed, since our dependent variable is ordered and categorical, not continuous.
    JEL: D82 I11 I12
    Date: 2008–09
  18. By: Martin Chalkley; J. S. Rennie; Colin Tilley
    Abstract: This paper uses a unique individual level administrative data set to analyse the participation of health professionals in the NHS after training. The data set contains information on over 1,000 dentists who received Dental Vocational Training in Scotland between 1995 and 2006. Using a dynamic nonlinear panel data model, we estimate the determinants of post-training participation. We ?nd there is signi?cant persistence in these data and are able to show that the persistence arises from state dependence and individual heterogeneity. This ?nding has implications for the structure of policies designed to increase participation rates. We apply this empirical framework to assess the accuracy of predictions for workforce forecasting, and to provide a preliminary estimate of the impact of one of the recruitment and retention policies available to dentists in Scotland.
    Keywords: administrative data, labour markets, participation
    Date: 2008–05
  19. By: Stefanie Schurer (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)
    Abstract: Empirical evidence from the psychology literature suggests that reactions towards health shocks depend strongly on the personality trait of locus of control, which is usually unobservable to the analyst. In this paper, the role of this discrete heterogeneity in shaping the effects of health shocks on labour supply are theoretically modelled by adopting the Grossman (1972) model. Using German longitudinal data, the predictions of the theoretical model are tested with a latent class binary choice model and an alternative identification strategy. A robust result across both specifications for various definitions of locus of control, health shocks and labour market outcomes is that internals have a smaller probability of leaving the labour market after experiencing a health shock than externals.
    Date: 2008–09
  20. By: Jeremiah Hurley (Department of Economics, Centre for Health Economics and Policy Analysis, Department of Clinical Epidemiology and Biostatistics, McMaster University); Michel Grignon (Department of Economics, Centre for Health Economics and Policy Analysis, Department of Health, Aging and Society, McMaster University); Li Wang (Centre for Health Economics and Policy Analysis, Department of Clinical Epidemiology and Biostatistics, McMaster University); Tara McGrath (Accelerated Economics Training Program, Government of Canada)
    Abstract: Distance-related geographic barriers challenge the ability of health systems to allocate health care resources equitably according to need. The paper adapts the concentration-index approach, commonly used for measuring income-related equity, to assess distance-related equity in hospital utilization in the province of Ontario, Canada. The analysis is based on individual-level data from the Canadian Community Health Survey, which provides information on respondents’ hospital utilization, health status, demographic, socio-economic status and location, merged with data on Ontario hospitals, and a geo-coded measure of each respondent’s distance to the nearest general acute-care hospital. We find no evidence of a relationship between distance to the nearest hospital and either the probability of hospitalization or the annual number of hospital nights. Supplementary analyses provide insight into hypothesized pathways between distance and hospitalization. Although having a regular medical doctor is positively associated with distance to the nearest hospital, controlling for this does not affect the estimated distance-hospitalization relationship. Both the size and occupancy rate of the nearest hospital are correlated with distance and are strongly related to the probability of hospitalization, but again controlling for these factors did not affect the estimated relationship between hospital use and distance to the nearest hospital. We do, however, find a strong positive gradient between the probability of hospitalization and distance to the nearest large hospital. This gradient is driven by the fact that, for most of those far from a large hospital, the nearest hospital is small with a low occupancy rate. Calculation of the distance-related horizontal inequity index confirms no distance-related inequity in hospital utilization when distance is measured to the nearest hospital of any size; however, when distance is instead measured to the nearest large hospital, we observe large, pro-distance inequity. These distance-use relationships are not captured by traditional geographic measures based on measures of urbanization/ruralness.
    Keywords: hospital utilization, equity, geography
    Date: 2008
  21. By: Nathalie Grandfils (IRDES institut for research and information in health economics)
    Abstract: In France, drug prices have historically been regulated but approaches to setting and regulating prices have been evolving in recent years. In 2003, the prices of new outpatient drugs, which had hitherto been entirely regulated, were semi-liberalised, with drug companies setting prices in line with those in neighbouring countries; and in parallel with this in 2004, the prices of expensive drugs and/or drugs qualifying for reassignment must now also be set in line with European prices. In addition to this, price/volume regulation has recently been introduced. This document describes the price setting rules applicable to each drug category and discusses different measures for regulating drug price, particu-larly the conventional policies implemented under successive framework agreements. The regulatory path for medicines and the different actors involved are presented in an Appendix.
    Keywords: Drugs, Regulation, Public Health
    JEL: I18 L65
    Date: 2008–09
  22. By: Wolfgang H. Reichmuth; Samad Sarferaz
    Abstract: We analyze the impact of short-run economic fluctuations on age-specific mortality using Bayesian time series econometrics and contribute to the debate on the procyclicality of mortality. For the first time, we examine the differing consequences of economic changes for all individual age classes. We employ a recently developed model to set up structural VARs of a latent mortality variable and of unemployment and GDP growth as main business cycle indicators. We find that young adults noticeably differ from the rest of the population. They exhibit increased mortality in a recession, whereas most of the other age classes between childhood and old age react with lower mortality to increased unemployment or decreased GDP growth. In order to avoid that opposed effects may cancel each other, our findings suggest to differentiate closely between particular age classes, especially in the age range of young adults. The results for the U.S. in the period 1956–2004 are confirmed by an international comparison with France and Japan. Long- term changes in the relationship between macroeconomic conditions and mortality are investigated with data since 1933.
    Keywords: Age-specific Mortality, Business Cycle, Unemployment, Bayesian Econometrics, Health, Epidemiology
    JEL: C11 C32 E32 I10 J10
    Date: 2008–09
  23. By: Joost de Laat; William Jack
    Abstract: This paper uses a newly collected dataset on Ethiopian physicians to shed light on the allocative efficiency of the physician labor market. We use a lottery mechanism by which medical school graduates are assigned to their first jobs to identify the long-term impact of being posted to a rural area instead of the capital, Addis Ababa. We find that physicians who are assigned to Addis are more satisfied with their initial and their current jobs. However, being assigned to the capital through the lottery does not appear to have significant long-run career benefits. This appears to be partly because relatively high ability physicians opt out of the lottery and find jobs in Addis, where they successfully compete with those assigned by the lottery for specialized training. We also find evidence of adverse selection in the market for physicians who initially participated in the lottery, compared with the market for physicians who did not. We rationalize these findings by suggesting that the lottery, by explicitly randomly assigning new graduates, obfuscates information about them that future employers would otherwise find valuable. High ability workers from the lottery do relatively worse later in their careers than their counterparts who did not take part in the lottery, and are more likely to exit the physician labor market in Ethiopia. Our results suggest that using a lottery to assign new physicians to jobs could compromise the future allocative efficiency of the labor market, and even contribute to the medical brain drain. This is not because the long-term impacts of getting a "bad" are negative, but because the lottery makes it difficult for good physicians to signal their quality.
    Keywords: Wage Level and Structure, Labor Contracts, Public Sector Labor Markets, Analysis of Health Care Markets
    JEL: I11 J45 O20
    Date: 2008
  24. By: Gandhi, B. Valentine Joseph; Bantilan, M. Cynthia Serquina; Parthasarathy, Devanathan
    Abstract: This paper discusses the livelihood dynamics in the fragile landscape of the semi arid tropics (SAT) of Andhra Pradesh. SAT is home to the poorest of the poor who live in conditions of persistent drought, subsistence agriculture and poor access to markets. This paper is a case study focusing particularly on labour migration, its role in influencing the health risk behaviour of migrants and in the spread of the HIV epidemic among SAT rural households. The most vulnerable population in these drought prone regions are the migrant labourers, and their vulnerability is influenced by three major factors?the vulnerability and unstable productivity in the degraded and marginal landscape, the caste system that has traditionally kept them backward and vulnerable, and experiences in the external environment to which they migrate. This study?based on a theoretical framework, whereby livelihood risks lead to health risks, particularly HIV infection?outlines the process that causes a further deterioration of the household and the occurrence of cyclical health risk. The paper calls for a multisectoral approach to tackle the issue of migrant vulnerability, and for interventions with a more migrant-need sensitive
    Keywords: labour migration, HIV risk behaviour, agriculture, health, semi-arid tropics
    Date: 2008
  25. By: Janet Currie; Johannes F. Schmieder
    Abstract: Every year, millions of pounds of toxic chemicals thought to be linked to developmental problems in fetuses and young children are released into the air. In this paper we estimate the effect of these releases on the health of newborns. Using data from the Toxic Release Inventory Program and Vital Statistics Natality and Mortality files, we find significant negative effects of prenatal exposure to toxicants on gestation and birth weight. We also find that several developmental chemicals increase the probability of infant death. The effect is quite sizeable: the reported reductions in cadmium, toluene, and epichlorohydrin releases during the 90s could account for about 3.9 percent of the overall decrease in infant mortality. Our results are robust to several specification checks, such as comparing developmental to non-developmental chemicals, and fugitive air releases to stack air releases.
    JEL: I18 Q53
    Date: 2008–09
  26. By: Roger Carrington; Tim Coelli; D. S. Prasada Rao (CEPA - School of Economics, The University of Queensland)
    Date: 2008
  27. By: Guillaumont, Patrick; Korachais, Catherine; Subervie, Julie
    Abstract: The reduction of child mortality is one of the most universally accepted Millennium Goals. However, there is a significant debate on the means of reaching it and its realism with regard to the situation in most of the least developed countries. The recommendations made for the achievement of this goal are mainly medical ones. However, without underestimating the importance of these measures, in particular vaccinations, it seems increasingly obvious that the rate of reduction of child mortality is mainly determined by the evolution of macroeconomic environment. The influence of per capita income level on mortality is frequently underlined. But a given income growth does not have the same effect on child survival if it is stable or unstable. Indeed, rises and falls of income probably have asymmetrical effects on mortality. The purpose of this analysis is precisely to show how macroeconomic instability influences the evolution of child mortality. The analysis is based on a panel sample of 97 developing countries over the period 1980-1999. The effect of exogenous shocks is first examined through a variable of income instability. The study of the relation is then deepened with ?primary instabilities?: instability of world agricultural commodity prices, instability of exports of goods and services and instability of agricultural production.
    Keywords: MDGs, mortality, children, health
    Date: 2008
  28. By: Nicolas Sirven (IRDES institut for research and information in health economics); Brigitte Santos-Eggimann (IUMSP Institute of Social and Preventive Medicine, University of Lausanne); Jacques Spagnoli (IUMSP Institute of Social and Preventive Medicine, University of Lausanne)
    Abstract: The aim of this paper is to measure and to correct for the potential incomparability of responses to the SHARE survey on health care responsiveness. A parametric approach based on the use of anchoring vignettes is applied to cross-sectional data (2006-07) in ten European countries. More than 6,000 respondents aged 50 years old and over were asked to assess the quality of health care responsiveness in three domains: waiting time for medical treatment, quality of the conditions in visited health facilities, and communication and involvement in decisions about the treatment. Chopit models estimates suggest that reporting heterogenity is influenced by both individual (socio-economic, health) and national characteristics. Although correction for differential item functioning does not considerably modify countries ranking after controlling for the usual covariates, about two thirds of the respondents' self-assessments have been re-scaled in each domain. Our results suggest that reporting heterogenity tends to overestimate health care responsiveness for "time to wait for treatment", whereas it seems to underestimate people's self-assessment in the two other domains.
    Keywords: Anchoring Vignettes, Cross-Country Comparison, Chopit Model
    JEL: I11 C81 C42
    Date: 2008–09
  29. By: Zeynep Or (IRDES institut for research and information in health economics); Florence Jusot (IRDES institut for research and information in health economics); Engin Yilmaz (IRDES institut for research and information in health economics)
    Abstract: This study examines the impact of health system characteristics on social inequities in health care use in Europe, using data from national surveys in 13 European countries. Multilevel logistic regression models are estimated to separate the individual level determinants of generalist and specialist use from the health system level and country specific factors. The results suggest that beyond the division between public and private funding and cost-sharing arrangements in health system, the role given to the general practitioners and/or the organization of the primary care might be essential for reducing social inequities in health care utilisation.
    Keywords: Equity, Health system, Doctor utilisation, Multilevel, International
    JEL: I12 I18 O57
    Date: 2008–09
  30. By: Adeline Delavande; Susann Rohwedder
    Abstract: Estimates of differential mortality by socioeconomic status play an important role in several domains: in public policy for assessing distributional effects of public programs; in financial markets for the design of life insurance and annuities; and in individual decision making when figuring out how much to save for retirement. Traditionally, reliable estimates of differential mortality require rich panel data with large sample size. This paper proposes a new, less data-intensive approach relying on just a single cross-section of data. Rather than using observations on actual mortality in panel over time, the authors propose relating individuals' subjective probabilities of survival to variables of socioeconomic status in cross-section. They formulate the method in a model of survey response and provide an empirical validation based on data from the Health and Retirement Study comparing the alternative estimates to the traditional estimates of differential mortality for the same sample of baseline respondents. They present two applications. First, they document an increase in differential mortality in the U.S. over time, and second, they produce comparable estimates of differential mortality for 10 European countries and the U.S. based on subjective probabilities of survival.
    JEL: J10
    Date: 2008–07

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