nep-hea New Economics Papers
on Health Economics
Issue of 2009‒04‒13
fifteen papers chosen by
Yong Yin
SUNY at Buffalo, USA

  1. How can we improve waiting time for elective surgery in Australian public hospitals? By Merehau Cindy Mervin; Sukhan Jackson
  2. Genetic Information: Comparing Alternative Regulatory Approaches when Prevention Matters By Francesca Barigozzi; Dominique Henriet
  3. Obesity and Labor Market Outcomes: Evidence from the British NCDS By Lindeboom, Maarten; Lundborg, Petter; van der Klaauw, Bas
  4. Overweight and Obesity and the Demand for Primary Physician Care By Datta Gupta, Nabanita; Greve, Jane
  5. Using the EQ-5D as a performance measurement tool in the NHS By Nancy Devlin; David Parkin; John Browne
  6. The Health Insurance Puzzle in Europe: The Role of Information By Ciro Avitabile
  7. Fertility response to natural disasters : the case of three high mortality earthquakes By Finlay, Jocelyn E.
  8. Activity based payment in hospitals: Principles and issues drawn from the economic literature and country experiences By Zeynep Or; Thomas Renaud
  9. Taking Chances: The Effect of Growing Up on Welfare on the Risky Behaviour of Young People By Deborah A. Cobb-Clark; Chris Ryan; Ana Sartbayeva
  10. The Skinny on Big Box Retailing: Wal-Mart, Warehouse Clubs, and Obesity By Courtemanche, Charles; Carden, Art
  11. Disentangling extrinsic and intrinsic motivations: the case of French GPs dealing with prevention By Philippe Batifoulier; Maryse Gadreau; Yves Arrighi; Yann Videau; Bruno Ventelou
  12. Retiree Health Benefits and the Decision to Retire By James Marton; Stephen A. Woodbury
  13. Occupational Safety and English Language Proficiency By Marvasti, Akbar
  14. Gender Roles and Medical Progress By Stefania Albanesi; Claudia Olivetti
  15. Technology Diffusion and Productivity Growth in Health Care By Jonathan Skinner; Douglas Staiger

  1. By: Merehau Cindy Mervin; Sukhan Jackson (School of Economics, The University of Queensland)
    Abstract: This paper presents preliminary results from a study on waiting time for elective care in Australian public hospitals. It uses available data published in Australia to test the hypotheses that public beds and hospital staffing (specialist surgeons and enrolled nurses) influence waiting time for elective surgery in Australian public hospitals. We extracted data from the National Elective Surgery Waiting Times Data Collection (NESWTDC) and analyse waiting times for 8 specialty surgeries in Australian public hospitals. Hospital beds, nurses and specialist surgeons are used as proxies for the endogeneity of waiting times in a multiple regression analysis. Our results show that available hospital beds negatively influence waiting times ( in Model 1). Interestingly, the number of nurses ( in Model 1) and specialist surgeons in Model 2) positively influence waiting times. We conclude that physical resources such as available hospital beds are significant; to improve waiting times, hospitals should be adequately funded.
    Date: 2009
  2. By: Francesca Barigozzi; Dominique Henriet
    Abstract: We compare the alternative approaches for regulating genetic information in the health insurance market when prevention measures are available. In the model, firms offer insurance contracts to consumers who are initially uninformed of their risk type but can obtain such information by performing a costless genetic test. A crucial ingredient of our analysis is that information has decision-making value since it allows for optimal choice of a self-insurance action (secondary prevention). We focus on the welfare properties of market equilibria obtained under the different regulatory schemes and, by using an intuitive graphical analysis, we rank them unambiguously. Our results show that Disclosure Duty weakly dominates the other regulatory schemes and that Strict Prohibition represents the worst regulatory approach.
    Keywords: health insurance markets, information gathering, discrimination risk, classification risk, self-insurance
    JEL: D82 D83 G22 L52
    Date: 2008–12
  3. By: Lindeboom, Maarten (Free University Amsterdam); Lundborg, Petter (Free University Amsterdam); van der Klaauw, Bas (Free University Amsterdam)
    Abstract: We study the effect of obesity on wages and employment, using data from the British NCDS. The results show a significant negative association between obesity and labor market outcomes even after controlling for a rich set of demographic, socioeconomic, environmental and behavioral variables. After instrumenting with parental obesity the associations are no longer significant. We show that the intergenerational correlation in obesity is mainly due to genetic variation. However, the instruments do not always pass the overidentification tests and are sometimes weak. We are therefore somewhat sceptical about using parental obesity as an instrument.
    Keywords: obesity, wages, employment, labor, endogeneity
    JEL: I10 J10
    Date: 2009–03
  4. By: Datta Gupta, Nabanita (Aarhus School of Business); Greve, Jane (Rockwool Foundation Research Unit)
    Abstract: The standard economic model for the demand for health care predicts that unhealthy behaviour such as being overweight or obese should increase the demand for medical care, particularly as clinical studies link obesity to a number of serious diseases. In this paper, we investigate whether overweight or obese individuals demand more medical care than normal weight individuals by estimating a finite mixture model which splits the population into frequent and non-frequent users of primary physician (GP) services according to the individual's latent health status. Based on a sample of wage-earners aged 25-60 years drawn from the National Health Interview (NHI) survey 2000 and merged to Danish register data, we compare differences in the impact of being overweight and obese relative to being normal weight on the demand for primary physician care. Estimated bodyweight effects vary across latent classes and show that being obese or overweight does not increase the demand for primary physician care among infrequent users but does so among frequent users.
    Keywords: overweight, obesity, demand for primary physician care
    JEL: I12 I18
    Date: 2009–03
  5. By: Nancy Devlin (Office of Health Economics, London); David Parkin (City Health Economics Centre, Economics Department, City University, London); John Browne (London School of Hygiene and Tropical Medicine, London)
    Abstract: In a landmark move, the UK Department of Health (DH) is introducing the routine use of Patient Reported Outcome Measures (PROMs) as a means of measuring the performance of health care providers in improving patient health. From April 2009 all patients will be asked to complete both generic (EQ-5D) and condition specific PROMs before and after surgery for four elective procedures; the intention is to extend this to a wide range of other NHS services. The aim of this paper is to report analysis of the EQ-5D data generated from a pilot study commissioned by the DH, and to consider the implications of the results for their use as performance indicators and measures of patient benefit. The EQ-5D has the potential advantage in the context of PROMs of enabling comparisons of performance across services as well as between providers; and in facilitating assessments of the cost effectiveness of NHS services. We present two new methods we have developed for analysing and displaying EQ-5D profile data: a Paretian Classification of Health Change, and a Health Profile Grid. Using these methods, we show that EQ-5D data can readily be used to generate useful insights into differences between providers in improving overall changes in health; results are also suggestive of striking differences in changes in health between surgical procedures. We conclude by noting a number of issues that remain to be addressed in the use of PROMs data as a basis for performance indicators.
    Keywords: EQ-5D; PROMs, health outcomes; performance indicators
    Date: 2009–03
  6. By: Ciro Avitabile (University College London, University of Naples Federico II and CSEF)
    Abstract: I use microdata from the Survey of Health, Ageing and Retirement in Europe to study whether the cost of acquiring health information is an important determinant of the decision to buy private hospital health insurance for individuals aged 50+, in eight European countries. I first test whether, conditional on health insurance companies' risk assessments, individuals have residual private information on insurance determinants other than their risk type. My results show that there are individual characteristics, not observed by the insurers, that are positively correlated with hospital insurance coverage and negatively correlated with the ex post probability of requiring hospital treatment. However, this opposite association is significantly different from zero only in countries with low quality healthcare systems. I then provide evidence that education and cognitive ability act as substitutes for quality of health promotion in determining the propensity to take out a voluntary private hospital insurance.
    Keywords: Health Insurance, Cognitive Ability, Healthcare Quality
    JEL: D83 G22 I18
    Date: 2009–04–01
  7. By: Finlay, Jocelyn E.
    Abstract: The event of a natural disaster, and being directly affected by it, brings a large shock to life-cycle outcomes. In addition to the replacement effects of higher fertility following a disaster that caused high mortality, a positive fertility response may be induced as children can be used to supplement household income. This paper analyzes three high mortality earthquakes: Gujarat, India, in 2001; North-West Frontier, Pakistan, in 2005; and Izmit, Turkey, in 1999. There is evidence of a positive fertility response to exposure to these large-scale natural disasters in addition to the response to child mortality. The results in this study are consistent with those of other studies that also find a positive fertility response following exposure to a disaster.
    Keywords: Population Policies,Natural Disasters,Hazard Risk Management,Youth and Governance,Street Children
    Date: 2009–03–01
  8. By: Zeynep Or (IRDES institut for research and information in health economics); Thomas Renaud (IRDES institut for research and information in health economics)
    Abstract: In 2005, France joined the ranks of most other developed countries when it introduced an activity based payment system to finance all acute care hospitals. Despite some basic principles in common, the design of these systems can vary significantly across countries. In order to understand better the issues raised by the new system in France, this paper examines the economic rationale for such a system, the key implementation decisions to be made and the challenges involved. The principle of paying hospitals according to their activity in relation to homogeneous groups of patients has some obvious advantages to improve efficiency and the transparency in health care financing. However, the literature and the experience of the other countries presented in this paper show that this mechanism of payment presents a certain number of risks and requires regular and careful adjustments to obtain the benefits expected of such a system. To ensure both the clinical and economic coherence of the classification used to define hospital activity, and to establish the corresponding level of tariffs, constitute two major challenges. The principle of paying a fixed price which is directly indexed on the average costs observed and which remains common to all types of hospitals has been increasingly subject to criticism. Furthermore, activity based payment, by its nature, can induce some perverse effects which requires complementary regulatory mechanisms to guarantee the quality of the care and equitable access. From the point of view of controlling health expenditure, it is equally important to follow closely the evolution of health care activity in different hospital settings, as well as in ambulatory care, since activity based payment may encourage hospitals to increase their activity by inducing greater demand for profitable services while shifting part of their costs towards medium/long-term care settings or to home-based or informal care.
    Keywords: Activity based payment, hospital, regulation, international comparison.
    JEL: H3 H4
    Date: 2009–03
  9. By: Deborah A. Cobb-Clark; Chris Ryan; Ana Sartbayeva
    Abstract: We analyze the effect of growing up on welfare on young people’s involvement in a variety of social and health risks. Young people in welfare families are much more likely to take both social and health risks. Much of the apparent link between family welfare history and risk taking disappears, however, once we account for family structure and mothers’ decisions regarding their own risk taking and investment in their children. Interestingly, we find no significant effect of socio-economic status per se. Overall, we find no evidence that growing up on welfare causes young people to engage in risky behavior.
    Keywords: youths, welfare, risky behaviour, socio-economic disadvantage
    JEL: J13 I38 J18
    Date: 2009–03
  10. By: Courtemanche, Charles (University of North Carolina at Greensboro, Department of Economics); Carden, Art (Rhodes College)
    Abstract: We estimate the impacts of Wal-Mart and warehouse club retailers on height-adjusted body weight and overweight and obesity status, finding evidence that Wal-Mart Discount Stores reduce weight slightly while Wal-Mart Supercenters and warehouse clubs either reduce weight or have no effect. The effects appear strongest for women, minorities, urban residents, and the poor. We then examine the impacts of these retailers on food and alcohol consumption, exercise, smoking, and eating out at restaurants in order to explain the results for weight. Most notably, all three types of stores are associated with increased consumption of fruits and vegetables and reduced consumption of dietary fat. These results are surprising given the conventional wisdom that cheap food leads to more eating, and suggest that income effects and relative price changes are more important that absolute price changes in this case.
    Keywords: Wal-Mart; obesity; health
    JEL: I10
    Date: 2008–09–04
  11. By: Philippe Batifoulier; Maryse Gadreau; Yves Arrighi; Yann Videau; Bruno Ventelou
    Abstract: The economic literature attaches great importance to the analysis of "professional motivations", in particular examining the possible crowding-out effects between extrinsic and intrinsic motivations. This article applies these questions to the healthcare professions with a view to providing a fair scaling of the implementation of pay-for-performance policies by public decision-makers. We assemble a panel of 528 independent general practitioners in the "Provence-Alpes-Côte d’Azur" region in France and provide an inter-personal statistical decomposition between extrinsic and intrinsic motivations with regard to preventive actions. The proportion of intrinsic motivations is relatively greater among physicians paid with fixed fees. The significant effect of age describes a U shape which can be interpreted as being the result of a "life cycle of medical motivations". Finally, econometric estimations demonstrate a correlation between a small proportion of intrinsic motivation and a feeling of injustice with regard to the reforms. The cross-sectional nature of the data does not allow us to draw any conclusions concerning the direction of the causality. But the above correlation would seem to support the theory that the implementation of a policy based on monetary incentives towards performance is perceived as being offensive and may be accompanied by a reduction in intrinsic motivations in medical practice.
    Keywords: General practitioners, Motivations, Prevention, Payment for performance, Intrinsic and extrinsic incentives, France
    Date: 2009
  12. By: James Marton (Georgia State University); Stephen A. Woodbury (W.E. Upjohn Institute and Michigan State University)
    Abstract: We estimate the effect of employer offers of retiree health benefits (RHBs) on the timing of retirement using a sample of men observed over a period of up to 12 years in the Health and Retirement Study (HRS). Our main concern is that such estimates may be contaminated by unobserved heterogeneity—workers with a taste for early retirement sort into jobs offering RHBs. We attempt to address this concern by using a fixed-effects estimator, which yields substantially smaller estimates of the effect of RHB offers than estimators that do not attempt to control for unobservables. The findings suggest that an RHB offer increased the probability of retirement by 14 percent on average for men born between 1931 and 1941.
    Keywords: Retirement; Health Insurance; Employee Benefits; Unobserved Effects
    JEL: J26 I18 D14
    Date: 2009–03
  13. By: Marvasti, Akbar
    Abstract: Recent occupational injury data shows a rising trend, which happens to coincide with both increases in the population of foreign born in the U.S. and with changes in its composition. This study aims at exploring the presence of a statistical relationship between occupational injuries and the level of English proficiency of foreign born using cross-sectional data on the rate of injury and count of injury incidents. A cultural gap hypothesis is also examined as an alternative explanation for the rise in work injuries. While there is some support for the adverse effect of inadequate English language proficiency of foreign born, the results for the cultural gap hypothesis are more robust.
    Keywords: English Proficiency; Occupational Injury
    JEL: J08 J0
    Date: 2008–07
  14. By: Stefania Albanesi; Claudia Olivetti
    Abstract: The entry of married women into the labor force is one of the most notable economic phenomena of the twentieth century. We argue that medical progress played a critical role in this process. Improved maternal health alleviated the adverse effects of pregnancy and childbirth on women's ability to work, while the introduction of infant formula reduced mothers' comparative advantage in infant feeding. We construct economic measures of these two dimensions of medical progress and develop a quantitative model that aims to capture their impact. Our results suggests that these advances, by enabling women to reconcile work and motherhood, were essential for the rise in married women's participation and the evolution of their economic role.
    JEL: E24 J16 J21 J22 N3
    Date: 2009–04
  15. By: Jonathan Skinner; Douglas Staiger
    Abstract: Inefficiency in the U.S. health care system has often been characterized as “flat of the curve†spending providing little or no incremental value. In this paper, we draw on macroeconomic models of diffusion and productivity to better explain the empirical patterns of outcome improvements in heart attacks (acute myocardial infarction). In these models, small differences in the propensity to adopt technology can lead to wide and persistent productivity differences across countries -- or in our case, hospitals. Theoretical implications are tested using U.S. Medicare data on survival and factor inputs for 2.8 million heart attack patients during 1986-2004. We find that the speed of diffusion for highly efficient and often low-cost innovations such as beta blockers, aspirin, and primary reperfusion explain a large fraction of persistent variations in productivity, and swamp the impact of traditional factor inputs. Holding technology constant, the marginal gains from spending on heart attack treatments appear positive but quite modest. Hospitals which during the period 1994/95 to 2003/04 raised their rate of technology diffusion (the “tigersâ€) experienced outcome gains four times the gains in hospitals with diminished rates of diffusion (the “tortoisesâ€). Survival rates in low-diffusion hospitals lag by as much as a decade behind high-diffusion hospitals, raising the question of why some hospitals (and the physicians who work there) adopt so slowly.
    JEL: H51 I1 O33
    Date: 2009–04

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