nep-hea New Economics Papers
on Health Economics
Issue of 2010‒10‒23
nine papers chosen by
Yong Yin
SUNY at Buffalo, USA

  1. The Economic Value of Preventing Fatalities: Recent evidence on the value of a statistical life in Sweden By Hultkrantz, Lars; Svensson, Mikael
  2. Physician Incentive Management in University Hospitals: Including Efficient Behavior Through the Allocation of Research Facilities By Glorie, K.; Oostrum, J.M. van; Dur, R.A.J.; Kazemier, G.; Wagelmans, A.P.M.
  3. Is it ever Enough? Food Consumption, Satiation and Obesit By Corinna Manig
  4. Is Universal Health Care in Brazil Really Universal? By Cataife, Guido; Courtemanche, Charles
  5. Medics, Monarchs and Mortality, 1600-1800: Origins of the Knowledge-Driving Health Transition in Europe By S. R. Johansson
  6. How Are Government Hospitals Performing? A Study of Resource Management in DOH-retained Hospitals By Rouselle F. Lavado; Abigail Barbara Sanglay-Dunleavy; Jeanette Jimenez; Yasuhiko Matsuda
  7. Regional variation in the productivity of the English National Health Service By Chris Bojke; Adriana Castelli; Mauro Laudicella; Andrew Street; Padraic Ward
  8. Safety and the Allocation of Costs in Large Accidents By Langlais, Eric
  9. Economies of Scale and Hospital Productivity: An empirical analysis of medical area level panel data By MORIKAWA Masayuki

  1. By: Hultkrantz, Lars (Department of Business, Economics, Statistics and Informatics); Svensson, Mikael (Department of Business, Economics, Statistics and Informatics)
    Abstract: <p> Aims: This paper briefly reviews the theoretical and empirical foundation for the economic valuation of preventing fatalities, referred to as the value of a statistical life (VSL), and summarizes recent published empirical evidence on VSL in Sweden. <P> Methods: Literature searches were conducted in Econlit, Pubmed, Google Scholar and in bibliographies of published papers. <P> Results: A total of nine published papers on the value of preventing fatalities in Sweden where identified since year 2000. Most studies have been conducted in a road-safety context, which may be explained by the widespread use of economic evaluations in this sector. Preferred policy estimates of the value of a statistical life in the road sector ranges from 13 to 57 million Swedish kronor (€1.4 to €6.1 million). Currently, official authorities in Sweden recommend a VSL of 22 million Swedish kronor (€2.4 million).<P> Conclusion: In order to conduct an economic evaluation of a life-saving intervention it is necessary to have an explicit economic value of a prevented fatality. Empirical research on Swedish data suggests that an appropriate value is in the range of 13 to 57 million Swedish kronor (€1.4 to €6.1 million). <P>
    Keywords: Willingness to pay; Value of a statistical life; Stated Preferences; Revealed Preferences; Economic Evaluation
    JEL: D61 H51 I18
    Date: 2010–10–14
  2. By: Glorie, K.; Oostrum, J.M. van; Dur, R.A.J.; Kazemier, G.; Wagelmans, A.P.M.
    Abstract: The imperative to improve healthcare efficiency is now stronger than ever. Rapidly increasing healthcare demand and the prospect of healthcare cost exploding require that measures be taken to make healthcare organizations become more efficiency-aware. Alignment of organizational interests is therefore important. One of the main hurdles to overcome is the provision of the right incentives to healthcare workers, in particular physicians. In this research we investigate the incentive system for physicians in university hospitals. We present an inquiry held in a large university hospital in the Netherlands and show that non-financial incentives receive significantly more support among physicians than financial incentives. Over 95 percent of the physicians indicated they derive more work stimulus from research possibilities or scientific status than from wage. Over 80 percent of the physicians also indicated they prefer to be able to do more research. We therefore identified a broad class of non-financial incentives aimed at physicians in university hospitals: research facilities. The main tradeoff in using research facilities within an incentive system is between efficient resource utilization and inducement effects. This thesis constructs a principal-multi-agent model where agents engage in both care and research and which includes heterogeneity and private information. We study how research facilities incentives can be used to improve hospital performance if the current wage system is left intact. We show that research facilities are optimally used as incentives for both care and research activities, and that the hospital offers different contracts depending on physician ability and valuation. Moreover, if physicians need to reveal their valuations for research facilities, the hospital finds it optimal to allow physicians to make a rent. We discuss some implications of extending the theoretical results to practice.
    Keywords: health care management;incentive contracts;mechanism design;principal agent problem
    Date: 2010–10–12
  3. By: Corinna Manig
    Abstract: In order to explain the growth of obesity in industrialized and transition economies, a behavioral approach to food intake and overconsumption of calories is presented. It is argued that changes in food consumption patterns are one of the main drivers behind the imbalance of calories consumed and calories spent. The inclusion of new types of food in the regular diet of individuals led to changes in the motives for eating. While the intake of nutrients has always been and still is a prime motive of food consumption, it will be argued that with a growing variety of food items other motives increasingly take over as major drivers of the expanding food intake. These other motives also cause that the internal signals indicating to the body when to close a consumption act now occur with delay. The interrelation of biological and psychological factors and changes in the composition of diet therefore forms the basis for weight gain and, in the long run, obesity.
    Keywords: Consumer behaviour, obesity, food consumption, needs, satiation processes Length 28 pages
    JEL: D11 D83 I19
    Date: 2010–10–11
  4. By: Cataife, Guido (University of Louisville, Department of Economics); Courtemanche, Charles (University of North Carolina at Greensboro, Department of Economics)
    Abstract: Since Brazil's adoption of a universal health care policy in 1988, the country's health care has been delivered by a mix of private providers and free public providers. We examine whether income-based disparities in medical care usage still exist after the development of the public network using a nationally representative sample of over 44,000 Brazilians from 2003. We find robust evidence of a positive association between income and doctor visits, private doctor visits, and private medical expenditures. Interestingly, we also find evidence of a positive relationship between income and public doctor visits that disappears after including local area fixed effects to account for variation in availability and quality of medical services across localities. Additionally, we estimate income elasticities of private doctor visits and medical expenditures of well below one, suggesting that private care remains a necessity despite the availability of free public care. These results together suggest that the public health care system in Brazil is not effectively reaching everyone.
    Keywords: universal health care; Brazil; income elasticity of demand for health care Family Health Program.
    JEL: I10 O12
    Date: 2010–10–05
  5. By: S. R. Johansson (The University of Cambridge)
    Abstract: Medical knowledge – defined broadly to include both its private and public forms – has been the driving force behind the historical transitions that have raised life expectancy in modern Europe. Advances in knowledge, rather than better nutrition (particularly the escape from caloric insufficiency) deserve greater emphasis because the very first groups to undergo anything recognizable as a secular rise in longevity were the rich and well fed, rather than the poor and chronically malnourished. At the beginning of the 16th century Europe’s ruling elites lacked virtually any reliable information about how best to use their ample material resources to prevent, manage and cure the ill-health that caused so many premature deaths among them. The advance of medical knowledge and practice accelerated in Western Europe after c. 1500, with a succession of discoveries that were quite useful (as judged by modern standards) in preventing disease, reducing “life-style” risks, managing illness and providing cures for a few debilitating and deadly diseases – severe dysentery, syphilis, malaria, scurvy and, finally, smallpox, being the principal diseases affected. Yet, access to most of the available innovative medical care remained closely restricted. Medical expertise was limited and highly priced, and many of the measures prescribed were unaffordable even to town-dwelling middling-income families in environments that exposed them to endemic and epidemic disease. Along with the poor, they therefore were left at a grave health disadvantage vis-à-vis adult members of the wealthy urban families to whose conditions the doctors were attending. The London-based ruling families of England in this epoch benefited to an exceptional degree among the European elites from the contemporary progress of medicine. Their improved chances of survival in adulthood were the major factor raising royal life expectancy at birth (males and females, combined) from 24.7 years for the cohort born during the 1600s to 49.4 years for those born during the 1700s.
    Date: 2010–10–11
  6. By: Rouselle F. Lavado; Abigail Barbara Sanglay-Dunleavy; Jeanette Jimenez; Yasuhiko Matsuda (Philippine Institute for Development Studies)
    Abstract: The paper attempts to provide an overview of the hospital sector in the Philippines with particular emphasis on hospitals being managed by the DOH. The paper begins with an overview of the hospital sector in the Philippines, describing the size, location, and utilization of hospital services. To assess the efficiency and effectiveness of service delivery in DOH-retained hospitals, an analysis of resource management is undertaken by examining the sources of funds, planning and budgeting cycle, uses of funds, and monitoring set-up. The paper provides a critique of recent policies concerning hospitals as outlined in the Health Sector Reform Strategy. The last section concludes and provides some policy recommendations.
    Keywords: health, health care, health sector, health care financing, health care reform, health expenditures, health facilities, health funds, health management, health services delivery, hospitals
    JEL: D20 I10 I11
    Date: 2010
  7. By: Chris Bojke (Centre for Health Economics, University of York, UK); Adriana Castelli (Centre for Health Economics, University of York, UK); Mauro Laudicella (Centre for Health Economics, University of York, UK); Andrew Street (Centre for Health Economics, University of York, UK); Padraic Ward (Centre for Health Economics, University of York, UK)
    Abstract: At a time when there are severe pressures on reducing public spending there is increasing emphasis on determining which parts of the country secure best value for money in the NHS. By linking together large scale and routinely collected datasets we produce and compare productivity estimates across the ten Strategic Health Authorities in England in 2007/08.
    Date: 2010–10
  8. By: Langlais, Eric
    Abstract: We study the characteristics of optimal levels of care and distribution of risk in a extended unilateral accident model, where 1/ parties are Rank Dependant Expected Utility maximizers, which allows us to capture two important behavioral characteristics in risk, both pessimism (probability transformation) and risk aversion; 2/ there exists an aggregate/uninsurable risk in case of accident ; 3/ tortfeasors have the opportunity to invest in damages reduction activities having a monetary cost of effort. Important results show that the optimal care is larger than under the risk neutral/small risks case, it depends on the aggregate wealth of society but does not depend on wealth distribution. We then examine whether ordinary liability rules, with or without insurance, can be used to implement the first-best outcome.
    Keywords: K13
    JEL: K13 D02
    Date: 2010–09–30
  9. By: MORIKAWA Masayuki
    Abstract: This paper estimates the total factor productivity (TFP) of hospitals by using panel data drawn from prefectures and secondary medical areas. The study focuses on the economies of scale at the medical area and hospital levels. It uses the average length of stay as a measure of medical quality. We avoid case-mix bias by using data from medical areas instead of those from the hospital level. We control unobservable regional characteristics by employing panel data estimation. We eliminate price disparities among regions by using quantity data. Our results show that hospital size affects productivity: the larger the hospital, the higher the productivity. The hospital-size effect is economically significant: hospital productivity increases by more than 10% when the size of the hospital doubles. The size effects are null when we do not control the average length of stay. The main policy implication is the clear fact that consolidating hospitals improves productivity.
    Date: 2010–10

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