nep-hea New Economics Papers
on Health Economics
Issue of 2012‒02‒20
29 papers chosen by
Yong Yin
SUNY at Buffalo, USA

  1. Perturbation analysis of indices of lifespan variability By Alyson A. van Raalte; Hal Caswell
  2. International Migration and the Propagation of HIV in Sub-Saharan Africa By Frédéric DOCQUIER; Chrysovalantis VASILAKIS; D. TAMFUTU MUNSI
  3. Estimated hedonic wage function and value of life in an African country By Abdelaziz Benkhalifa; Mohamed Ayadi; Paul Lanoie
  4. Why Are So Many Disabled Individuals Not Working in Spain? A Job Search Approach By Silva, José I.; Vall Castello, Judit
  5. Long Term Impacts of Compensatory Preschool on Health and Behavior: Evidence from Head Start By Carneiro, Pedro; Ginja, Rita
  6. The Effects of World War II on Economic and Health Outcomes across Europe By Kesternich, Iris; Siflinger, Bettina; Smith, James P.; Winter, Joachim K.
  7. International Comparisons in Health Economics: Evidence from Aging Studies By Banks, James; Smith, James P.
  8. Long-Run Effects of Gestation During the Dutch Hunger Winter Famine on Labor Market and Hospitalization Outcomes By Scholte, Robert; van den Berg, Gerard J.; Lindeboom, Maarten
  9. The Effectiveness of Health Screening By Hackl, Franz; Halla, Martin; Hummer, Michael; Pruckner, Gerald J.
  10. Income Inequality and Health: Lessons from a Refugee Residential Assignment Program By Grönqvist, Hans; Johansson, Per; Niknami, Susan
  11. Healthcare financing in OECD countries beyond the public-private split By Götze, Ralf; Schmid, Achim
  12. Estimates of Wage Discrimination Against Workers with Sensory Disabilities, with Controls for Job Demands By BALDWIN Marjorie L.; CHOE Chung
  13. A fuzzy logic approach to measure overweight By PI ALPERIN Maria Noel; BERZOSA Guayarmina
  14. Mines, migration and HIV/AIDS in southern Africa By Corno, Lucia; de Walque, Damien
  15. Do Health Care Report Cards Cause Providers to Select Patients and Raise Quality of Care? By Yijuan Chen; Juergen Meinecke
  16. Econometric models of child mortality dynamics in rural Bangladesh. By Saha, U.R.
  17. Modelling Mortality Using Multiple Stochastic Latent Factors By Jorge Bravo
  18. Assessing the Efficiency of Mother-to-Child HIV Prevention in Low- and Middle-Income Countries using Data Envelopment Analysis By Sérgio P. Santos; Carla A.E. Amado; Mauro F. Santos
  19. Prospective Lifetables: Life Insurance Pricing and Hedging in a Stochastic Mortality Environment By Jorge Bravo; Carlos Pereira da Silva
  20. Modelling zero-inflated count data when exposure varies: with an application to sick leave By Gregori Baetschmann; Rainer Winkelmann
  21. Risk attitudes and Medicare Part D enrollment decisions By Vetter, Stefan; Heiss, Florian; McFadden, Daniel; Winter, Joachim
  22. The Impact of Colombia's Pension and Health Insurance Systems on Informality By Valentina Calderón; Ioana Marinescu
  23. Labor Informality and the Incentive Effects of Social Security: Evidence from a Health Reform in Uruguay By Marcelo Bérgolo; Guillermo Cruces
  24. Effects of welfare reform and the state children’s health insurance program on medicaid and total health expenditures By Datta, Anusua; Vandegrift, Donald
  25. Complexity Science Models of Financing Health and Social Security Fiscal Gaps By Hayes, James A
  26. The Impact of Health Insurance for Children: Evidence from Vietnam By Nguyen Viet, Cuong
  27. Moral Hazard in Health Insurance: How Important Is Forward Looking Behavior? By Aviva Aron-Dine; Liran Einav; Amy Finkelstein; Mark R. Cullen
  28. The Double Facetted Nature of Health Investments - Implications for Equilibrium and Stability in a Demand-for-Health Framework By Kristian Bolin; Bjorn Lindgren
  29. Positive and Negative Mental Health Consequences of Early Childhood Television Watching By Michael Waldman; Sean Nicholson; Nodir Adilov

  1. By: Alyson A. van Raalte (Max Planck Institute for Demographic Research, Rostock, Germany); Hal Caswell (Max Planck Institute for Demographic Research, Rostock, Germany)
    Abstract: A number of indices have been used in recent years to calculate lifespan variation, each with dierent underlying properties. Although these indices are assumed to be interchangeable, little research has been conducted to show under which conditions this assumption is appropriate, or how to compare their responses to the underlying mor- tality schedule. We compare seven indices of lifespan variation: life disparity, the Gini coecient, the standard deviation, the variance, Theil's index, the mean logarithmic deviation, and the inter-quartile range. We derive the sensitivity and elasticity of each index by apply- ing Markov chain theory and matrix calculus. Using empirical French and Russian male data we compare the underlying sensitivities to mor- tality change under dierent mortality regimes in order to test under which conditions the indices might dier in their conclusions about the magnitude of lifespan variation. Finally we demonstrate how integrat- ing these sensitivities can be used as a method of age decomposition. The result is an easily computable method for calculating the proper- ties of this important class of longevity indices.
    Keywords: inequality, mathematical demography, mortality measurement
    JEL: J1 Z0
    Date: 2012–01
  2. By: Frédéric DOCQUIER (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES) and FNRS); Chrysovalantis VASILAKIS (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES)); D. TAMFUTU MUNSI (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES))
    Abstract: In this paper, we identify and quantify the role of international migration in the propagation of HIV across sub-Saharan African countries. We use a panel database on bilateral migration flows and HIV prevalence rates covering 44 countries over the nineties. Controlling for unobserved heterogeneity, spatial autocorrelation, reverse causality and reflection issues, and incorrect treatment of country fixed effects, we regress the log-change of HIV prevalence rates on the average levels of prevalence at destination and origin of migrants. We find evidence of a very robust emigration-induced propagation mechanism. On the contrary, immigration has no significant effect. Numerical experiments reveal that the long-run effect of emigration accounts for more than 5 percent of HIV prevalence rates in 18 countries (resp. 20 percent in 9 countries).
    Keywords: international migration, labor mobility, HIV/AIDS, pandemics, propagation of diseases
    JEL: F22 I12 J61
    Date: 2011–10–28
  3. By: Abdelaziz Benkhalifa; Mohamed Ayadi; Paul Lanoie (IEA, HEC Montréal)
    Abstract: This paper reports the first study of compensating wage differentials for work-related fatalities in an African country. Using original data from the 2002 Tunisian Caisse nationale de la sécurité sociale, statistically significant compensating wage differentials are found. The implied value of life is $ 643800 (US $ 2000).
    Keywords: Compensating wage differentials; Value of life
    JEL: J17 J28 J31
    Date: 2012–01
  4. By: Silva, José I. (Universitat de Girona); Vall Castello, Judit (Universitat de Girona)
    Abstract: Unlike other disability systems in developed economies, the Spanish system allows partially disabled individuals to work while receiving disability benefits. The puzzle is, however, that employment rates in this group of individuals are very low. The aim of this paper is to understand the incentives and disincentives to work provided by the partial disability scheme in Spain. We first present a theoretical job search model for partially disabled individuals and then estimate a complementary log-log duration model. According to both models, the probability of finding a job falls with the level of disability, the age at which the individual starts receiving disability benefits, and the increase in the local unemployment rate. Moreover, as a result of an increase in the level of disability benefits we find a strong substitution effect that reduces the probability of disabled individuals older than 55 years finding a job to almost zero, in both of the two models. We simulate that the strong substitution effect would be replaced by an equally large income effect even if the increase in the benefits would not be suspended if the individual finds a job.
    Keywords: job search model, disability benefits, duration analysis
    JEL: C41 I18 J64
    Date: 2012–01
  5. By: Carneiro, Pedro (University College London); Ginja, Rita (Uppsala University)
    Abstract: This paper provides new estimates of the medium and long-term impacts of Head Start on the health and behavioral problems of its participants. We identify these impacts using discontinuities in the probability of participation induced by program eligibility rules. Our strategy allows us to identify the effect of Head Start for the set of individuals in the neighborhoods of multiple discontinuities, which vary with family size, state and year (as opposed to a smaller set of individuals neighboring a single discontinuity). Participation in the program reduces the incidence of behavioral problems, serious health problems and obesity of male children at ages 12 and 13. It also lowers depression and obesity among adolescents, and reduces engagement in criminal activities for young adults.
    Keywords: regression discontinuity design, early childhood development, non-cognitive skills, Head Start
    JEL: C21 I28 I38
    Date: 2012–01
  6. By: Kesternich, Iris (University of Munich); Siflinger, Bettina (University of Munich); Smith, James P. (RAND); Winter, Joachim K. (University of Munich)
    Abstract: In this paper, we investigate the long-run effects of World War II on socio-economic status (SES) and health of older individuals in Europe. Physical and psychological childhood events are important predictors for labor market and health outcomes in adult life, but studies that quantify these effects in large samples that cover entire diverse populations are still rare. We will analyze data from SHARELIFE, a retrospective survey conducted as part of the Survey on Health, Aging, and Retirement in Europe (SHARE) in 2009. This survey provides detailed data on events in childhood including those during the war as well as several measures of exposure to war shocks such as experience of dispossession, persecution, combat in local areas, and hunger periods for over 20,000 individuals in 13 European countries. We find that exposure to the war itself, and even more importantly to individual-level shocks caused by the war such as hunger periods, significantly predict old-age outcomes at older ages.
    Keywords: health, war, SES
    JEL: I0 H0
    Date: 2012–01
  7. By: Banks, James (Institute for Fiscal Studies, London); Smith, James P. (RAND)
    Abstract: We provide an overview of the growing literature that uses micro-level data from multiple countries to investigate health outcomes, and their link to socioeconomic factors, at older ages. Since the data are at a comparatively young stage, much of the analysis is at an early stage and limited to a handful of countries, with analysis for the US and England being the most common. What is immediately apparent as we get better measures is that health differences between countries amongst those at older ages are real and large. Countries are ranked differently according to whether one considers life-expectancy, prevalence or incidence of one condition or another. And the magnitude of international disparities may vary according to whether measures utilize doctor diagnosed conditions or biomarker-based indicators of disease and poor health. But one key finding emerges – the US ranks poorly on all indicators with the exception of self-reported subjective health status.
    Keywords: international health, labor markets
    JEL: I0 H0
    Date: 2012–01
  8. By: Scholte, Robert (VU University Amsterdam); van den Berg, Gerard J. (University of Mannheim); Lindeboom, Maarten (VU University Amsterdam)
    Abstract: The Dutch Hunger Winter (1944/45) is the most-studied famine in the literature on long-run effects of malnutrition in utero. Its temporal and spatial demarcations are clear, it was severe, it was not anticipated, and nutritional conditions in society were favorable and stable before and after the famine. This is the first study to analyze effects of in utero exposure on labor market outcomes and hospitalization, and the first to use register data covering the full Dutch population to examine long-run effects of this famine. We provide results of famine exposure by sub-interval of gestation. We find a significantly negative effect of exposure during the first trimester of gestation on employment outcomes 53 or more years after birth. Hospitalization rates in the years before retirement are higher after middle or late gestational exposure.
    Keywords: morbidity, developmental origins, ageing, nutrition, income, health, employment
    JEL: I10 I12 J01 J10 J13 J24
    Date: 2012–01
  9. By: Hackl, Franz (University of Linz); Halla, Martin (University of Linz); Hummer, Michael (University of Linz); Pruckner, Gerald J. (University of Linz)
    Abstract: Using a matched insurant-general practitioner panel data set, we estimated the effect of a general health-screening program on individuals' health status and health care cost. To account for selection into treatment, we used regional variations in the intensity of exposure to supply-determined screening recommendations as an instrumental variable. We found that screening participation substantially increased inpatient and outpatient health care costs for up to two years after treatment. In the medium term, we found cost savings in the outpatient sector, whereas in the long run, no statistically significant effects of screening on either health care cost component could be discerned. In summary, screening participation increases health care costs. Since we did not find any statistically significant effect of screening participation on insurants' health status at any point in time, we do not recommend a general health-screening program. However, given that we found some evidence for cost-saving potentials for the sub-sample of younger insurants, we suggest more targeted screening programs.
    Keywords: health screening, health care costs, sick leave, mortality
    JEL: I10 I18
    Date: 2012–01
  10. By: Grönqvist, Hans (Swedish Institute for Social Research, Stockholm University); Johansson, Per (IFAU, Uppsala University); Niknami, Susan (Swedish Institute for Social Research, Stockholm University)
    Abstract: This paper examines the effect of income inequality on health for a group of particularly disadvantaged individuals: refugees. Our analysis draws on longitudinal hospitalization records coupled with a settlement policy where Swedish authorities assigned newly arrived refugees to their first area of residence. The policy was implemented in a way that provides a source of plausibly random variation in initial location. The results reveal no statistically significant effect of income inequality on the risk of being hospitalized. This finding holds also for most population subgroups and when separating between different types of diagnoses. Our estimates are precise enough to rule out large effects of income inequality on health.
    Keywords: Income inequality; Immigration; Quasi-experiment
    JEL: I10 J15
    Date: 2012–02–14
  11. By: Götze, Ralf; Schmid, Achim
    Abstract: Background: Studies of long-term trends in the healthcare financing mix generally focus on a dichotomous concept discerning public from private funding sources. More detailed analyses of the funding mix tend to be restricted to a small number of cases or do rarely examine time trends. Aim: This paper enhances the existing body of literature by developing and applying a trichotomous concept for healthcare funding, distinguishing taxes, contributions, and private sources. This includes a new aggregated indicator for the mix of three financing sources and its graphical representation. Methods: The study mainly builds upon OECD Health Data 2011. We measure changes in the funding mix since 1972 as its distance from a funding mix that equally draws upon taxes, contributions and private sources. Results: Up to 1980, the OECD healthcare systems move toward ideal-typical financing schemes. Between 1980 and 2000, the funding mix hybridizes mainly driven by privatization processes in NHS and social insurance countries and ongoing switch-over-processes between these two healthcare system types. Since 2000, OECD countries again tend toward ideal-typical funding schemes. Discussion: We use the framework for institutional change developed by Streeck and Thelen. The quantitative approach highlights changes in terms of displacement, layering, and drift but fails to fully reveal conversion processes. Therefore, further qualitative research is needed to capture not only shifts between the funding sources but also more gradual changes within them. Conclusion: The back-and-forth development of the trichotomous funding mix challenges assumptions of a universal trend toward hybrid financing structures. -- Rahmen: Arbeiten, die langfristige Trends des Finanzierungsmix von Gesundheitsausga-ben untersuchen, basieren in der Regel auf einem dichotomen Konzept, das öffentliche und private Quellen unterscheidet. Detailliertere Studien zum disaggregierten Finanzierungsmix sind zumeist auf kleine Fallzahlen beschränkt oder betrachten keine Entwicklungen über Zeit. Ziel: Das Arbeitspapier entwickelt ein trichotomes Finanzierungskonzept, das zwischen Steuern, Beiträgen und privaten Quellen unterscheidet und wendet dieses auf OECD-Gesundheitssysteme an. Hierfür wird ein neuer Hybriditätsindex gebildet, der den Finanzierungsmix eines Landes beschreibt und graphisch verortet. Methoden: Wir messen die Veränderungen im Finanzierungsmix seit 1972 als Distanz von einem hypothetischen Finanzierungsmix, der sich jeweils zu einem Drittel auf Steuern, Beiträge und privaten Ausgaben stützt. Als Quelle dienen die OECD Health Data 2011 und ergänzende nationale Statistiken. Ergebnisse: Bis etwa 1980 steuern die OECD-Gesundheitssysteme auf unterschiedliche idealtypische Finanzierungsmodelle zu. Zwischen 1980 und 2000 beobachten wir eine Hybridisierung der Finanzierung von Gesundheitsausgaben, die vorwiegend auf Privatisierungsprozesse in den NHS- und Sozialversicherungsländern zurückgeführt werden kann. Überdies tragen einzelne Länder durch einen inkrementellen Übergang vom Sozialversicherungssystem zum NHS zunächst zur Hybridisierung bei. Seit 2000 neigen die OECD-Länder wieder idealtypischen Finanzierungsstrukturen zu. Diskussion: Wir analysieren die Befunde anhand der von Streeck und Thelen entwickelten Formen institutionellen Wandels. Der Hybridisierungsindex verdeutlicht Wandel in Form von Displacement, Layering und Drift, während Conversion-Prozesse nicht vollständig abgebildet werden können. Hierfür bedarf es qualitativer Analysen, die nicht nur Verschiebungen zwischen Finanzierungsarten sondern graduelle Veränderungen innerhalb einer Finanzierungsart erfassen. Fazit: Der Wandel zwischen Hybridisierungsphasen und Phasen der Stärkung idealtypischer Finanzierung deutet darauf hin, dass funktionale Annahmen eines langfristigen Trends zu hybriden Finanzierungsstrukturen zu kurz greifen.
    Date: 2012
  12. By: BALDWIN Marjorie L.; CHOE Chung
    Abstract: We provide the first-ever estimates of wage discrimination against workers with sensory (hearing, speech, vision) disabilities. Workers with sensory disabilities have lower probabilities of employment and lower wages, on average, than nondisabled workers. Their poor labor market outcomes are explained, at least in part, by the negative productivity effects of sensory limitations in jobs that require good communication skills, but disabilityrelated discrimination may also be a contributing factor. To separate productivity vs. discrimination effects, we decompose the wage differential between workers with and without sensory disabilities into an „explained? part attributed to differences in productivity-related characteristics, and an „unexplained? part attributed to discrimination. The decomposition is based on human capital wage equations with controls for job-specific demands related to sensory abilities, and interactions between job demands and sensory limitations. The interactions are interpreted as measures of the extent to which a worker?s sensory limitations affect important job functions. The results indicate approximately 1/3 (1/10) of the disability-related wage differential for men (women) is attributed to discrimination. The estimates are quite different from estimates of discrimination against workers with physical disabilities obtained by the same methods, underscoring the importance of accounting for heterogeneity of the disabled population in discrimination studies.
    Keywords: Job demand; Sensory disability; Wage discrimination
    JEL: I10 J71
    Date: 2011–12
  13. By: PI ALPERIN Maria Noel; BERZOSA Guayarmina
    Abstract: We apply fuzzy sets theory to measure the extent of overweight in Luxembourg. This methodology permits to differentiate between mild or severe forms of overweight and to identify the sub-populations which contribute most to global overweight. The application to residents of Luxembourg shows that natives are those who contribute most to global overweight. Specifically, men are more affected than women, the intensity of overweight is more severe with age and the more educated are less affected by obesity.
    Keywords: decomposition; fuzzy set theory; overweight
    JEL: D63 I19
    Date: 2011–11
  14. By: Corno, Lucia; de Walque, Damien
    Abstract: Swaziland and Lesotho have the highest HIV prevalence in the world. They also share another distinct feature: during the last century, they sent a large numbers of migrant workers to South African mines. This paper examines whether participation in mining in a bordering country affects HIV infection rate. A job in the mines means leaving for long periods away from their families and living in an area with an active sex industry. This creates potential incentives for multiple, concurrent partnerships. Using Demographic and Health Surveys, the analysis shows that migrant miners ages 30-44 are 15 percentage points more likely to be HIV positive, and women whose partner is a migrant miner are 8 percentage points more likely to become infected. The study also shows that miners are less likely to abstain or use condoms, and female partners of miners are more likely to engage in extramarital sex. The authors interpret these results as suggesting that miners'migration into South Africa has increased the spread of HIV/AIDS in their countries of origin. Consistent with this interpretation, the association between HIV infection and being a miner or a miner's wife are not statistically significant in Zimbabwe, a country where the mining industry is local and does not involve migrating to South Africa.
    Keywords: Population Policies,HIV AIDS,Disease Control&Prevention,Gender and Health,Gender and Law
    Date: 2012–02–01
  15. By: Yijuan Chen; Juergen Meinecke
    Abstract: We exploit a brief period of asymmetric information during the implementation of Pennsylvania’s “report card” scheme for coronary artery bypass graft surgery to test for improvements in quality of care and selection of patients by health care providers. During the ?rst three years of the 1990s, providers in Pennsylvania had an incentive to bias report cards by selecting patients strategically, with patients having no access to the report cards. This dichotomy enables us to separate providers’ selection of patients from patients’ selection of providers. Using data from the Nationwide Inpatient Sample, we estimate a non–linear difference–in– differences model and derive asymptotic standard errors. The mortality rate for bypass patients decreases by only 0.05 percentage points due to the report cards, which we interpret as evidence that quality of bypass surgery did not improve (at least in the short–term) nor did patient selection by providers occur. Our timing, estimation, and asymptotics are readily applicable to many other report card schemes.
    Keywords: health care report cards; provider moral hazard; quality improvement; difference–in–differences estimation
    JEL: C23 D82 I18
    Date: 2012–01
  16. By: Saha, U.R. (Tilburg University)
    Abstract: Child mortality remains an important issue in Bangladesh. This thesis consists of four empirical studies on child mortality using data on Health and Demographic Surveillance System (HDSS) in Matlab, Bangladesh. The first study investigates the inter-family observed and unobserved heterogeneity in child deaths and the causal effect of death of one child on survival chances of the next child. The second study investigates the relationships between birth spacing, child survival and fertility allowing for the simultaneous nature of these processes, and controlling for both observed and unobserved heterogeneity in the outcomes of interest. The third study investigates the causal role of contraceptive use on birth spacing allowing for simultaneous nature of these processes and controlling for both observed and unobserved heterogeneity in the outcomes of interest. The fourth study analyzes the underlying epidemiology of child deaths taking into account competing risks associated with both observed and unobserved heterogeneity. The studies distinguish the differences in child mortality dynamics in rural Bangladesh between two areas ICDDR,B and comparison with and without extensive health services.
    Date: 2012
  17. By: Jorge Bravo (University of Évora, Department of Economics and CEFAGEUE)
    Abstract: In this paper we develop a new model for stochastic mortality that considers the possibility of both positive and negative catastrophic mortality shocks. Specifically, we assume that the mortality intensity can be described by an affine function of a finite number of latent factors whose dynamics is represented by affine-jump diffusion processes. The model is then embedded into an affine-jump framework, widely used in the term structure literature, in order to derive closed-form solutions for the survival probability. This framework and model application to the classical Gompertz-Makeham mortality law provides a theoretical foundation for the pricing and hedging of longevity-linked derivatives.
    Keywords: Stochastic mortality intensity; Longevity risk; Affine-jump models.
    JEL: G22
    Date: 2011
  18. By: Sérgio P. Santos (Faculty of Economics, University of Algarve and CEFAGE-UE); Carla A.E. Amado (Faculty of Economics, University of Algarve and CEFAGE-UE); Mauro F. Santos (CASEE, University of Algarve)
    Abstract: AIDS is one of the most significant health care problems worldwide. Due to the difficulty and costs involved in treating HIV, preventing infection is of paramount importance in controlling the AIDS epidemic. The main purpose of this paper is to explore the potential of using Data Envelopment Analysis (DEA) to establish international comparisons on the efficiency implementation of HIV prevention programmes. To this effect we use data from 52 low- and middle-income countries regarding the prevention of mother-to-child transmission of HIV. Our results indicate that there is a remarkable variation in efficiency of prevention services across nations, suggesting that a better use of resources could lead to more and improved services, and ultimately, prevent the infection of thousands of children. These results also demonstrate the potential strategic role of DEA for the efficient and effective planning of scarce resources to fight the epidemic.
    Keywords: HIV Prevention; DEA; Mother-to-Child HIV Transmission.
    JEL: C14 I12
    Date: 2012
  19. By: Jorge Bravo (University of Évora, Department of Economics and CEFAGEUE); Carlos Pereira da Silva (Department of Management, ISEG - Technical University of Lisbon/Portugal and CIEF)
    Abstract: In life insurance, actuaries have traditionally calculated premiums and reserves using a deterministic mortality intensity, which is a function of the age of the insured only. Over the course of the 20th century, the population of the industrialized world underwent a major mortality transition, with a dramatic decline in mortality rates. The mortality decline has been dominated by two major trends: a reduction in mortality due to infectious diseases affecting mainly young ages, and a decrease in mortality at old ages. These mortality improvements have to be taken into account to price long-term life insurance products and to analyse the sustainability of social security systems. In this paper, we argue that pricing and reserving for pension and life insurance products requires dynamic (or prospective) lifetables. We briefly review classic and recent projection methods and adopt a Poisson log-bilinear approach to estimate Portuguese Prospective Lifetables. The advantages of using dynamic lifetables are twofold. Firstly, it provides more realistic premiums and reserves, and secondly, it quantifies the risk of the insurance companies associated with the underlying longevity risks. Finally, we discuss possible ways of transferring the systematic mortality risk to other parties.
    Date: 2012
  20. By: Gregori Baetschmann; Rainer Winkelmann
    Abstract: This paper is concerned with the analysis of zero-inflated count data when time of exposure varies. It proposes a new zero-inflated count data model that is based on two homogeneous Poisson processes and accounts for exposure time in a theory consistent way. The new model is used in an application to the effect of insurance generosity on the number of absent days.
    Keywords: Exposure, Poisson regression, complementary log-log link
    JEL: J29 C25
    Date: 2012–02
  21. By: Vetter, Stefan; Heiss, Florian; McFadden, Daniel; Winter, Joachim
    Abstract: The new Medicare Part D program provides prescription drug coverage for older Americans through highly subsidized and tightly regulated plans offered by private insurance firms. For most eligible individuals without coverage from other sources, obtaining Part D coverage would be rational, but it requires active enrollment and plan choice decisions. We investigate if non-enrollment in Medicare Part D can partly be explained by risk aversion. Data are taken from a national online survey conducted just after the introduction Part D. The survey included a context-free and a context-related hypothetical lottery to measure an individual’s attitude towards risk. Respondents who are risk tolerant according to these measures were significantly less likely to enroll in Part D. We also illustrate that hypothetical choice questions designed to elicit risk attitudes are subject to reference-point effects. Even minor differences in the priming of respondents can result in potentially misleading conclusions about the role of risk aversion in the insurance decisions.
    Keywords: Risk aversion; Medicare Part D; heterogeneous preferences; insurance demand; survey design
    JEL: D03 D81 H51 I1
    Date: 2012–02
  22. By: Valentina Calderón; Ioana Marinescu
    Abstract: This paper examines how changes in the legislation governing health and pension benefits that took place between 2003 and 2008 in Colombia affected the informal and formal labor markets. In particular, this paper examines two major changes in the legislation. First, it looks at the effects of imposing the requirement to use the same base income to contribute to both health insurance and pensions for independent workers using a difference-in-differences strategy. Second, this document addresses the effects of unifying health and pension system payments, which required employers to make contributions to these two plans through a unified payment system, making it more difficult to contribute differently to the one plan versus the other. The results presented in this paper suggest that this reform increased both full formality and full informality, but with larger positive effects on full formality.
    Keywords: Labor :: Social Security, Health :: Health Policy, Social Development :: Social Policy & Protection, Informal Sector, Pensions, Health Insurance, Social Protection
    JEL: I11 I18 O17
    Date: 2011–03
  23. By: Marcelo Bérgolo; Guillermo Cruces
    Abstract: This paper studies the incentive effects of social security benefits on labor market informality following a policy reform in Uruguay. The reform extended health benefits to dependent children of private sector salaried workers, and thus altered the incentive structure of holding formal jobs within the household. The identification strategy of the reform¿s effects relies on a comparison between workers with children (affected by the reform) and those without children (unaffected by the reform). Difference in differences estimates indicate a substantial effect of this expansion of coverage on informality rates, which fell significantly by about 1.3 percentage points (a 5 percent change) among workers in the treatment group with respect to those in the control group. The evidence also indicates that individuals within households jointly optimized their allocation of labor to the formal and informal sector. Workers responded to the increased incentives for only one member of the household to work in the formal sector. These findings provide evidence of the relevant and substantial incentive effects of social security benefits on the allocation of employment.
    Keywords: Labor :: Workforce & Employment, Labor :: Social Security, Health :: Health Policy, CEDLAS
    Date: 2011–03
  24. By: Datta, Anusua; Vandegrift, Donald
    Abstract: Medicaid expenditures account for a sizeable proportion of U.S. GDP - $360.3 billion in 2009 or 2.55 percent of GDP. Despite this, the Affordable Care Act of 2010 (i.e. the new Obama healthcare initiative) further expands eligibility criteria for the Medicaid program. However, there is little literature on the effect on healthcare spending from earlier expansions of Medicaid such as the introduction of the SCHIP program. Moreover, the effect of welfare reform (i.e. Personal Responsibility and Work Opportunity Reconciliation Act of 1996) on Medicaid spending has received little attention. Using panel data from all 50 U.S. states for the period 1990-2004, we find that adding one person to the SCHIP rolls in a state that has established an SCHIP program in Medicaid raises real Medicaid spending about $4,100. However, we find evidence that additional SCHIP enrollments also affect non-Medicaid health spending. Thus, the total costs of insuring these patients are significantly higher (about $7,700). For states that have established Medicaid-combined programs, adding one person to the SCHIP rolls raises real healthcare spending about $1,800 after two years. Finally, we find that welfare reform reduced annual Medicaid expenditures by about $1.2 billion and total healthcare spending by about $2.5 billion.
    Keywords: Healthcare costs; Medicaid; SCHIP; Welfare Reform
    JEL: I18 I38 I00
    Date: 2011–12–20
  25. By: Hayes, James A
    Abstract: Many think health and Social Security markets and social insurance programs are broken because they are increasingly unaffordable for too many Americans. Bending the cost curve down has become a standard reference term for the main objective of reform proposals to slow cost increases or even reduce them. This paper presents an alternative model with preliminary results of statistical analyses of complexity science simulation models with historical data that quickly bend the GDP curve up to increase affordability. This paper looks beyond popular reform models to self-organizing complexity science models based on chemistry, physics, and biology theories to suggest sustainable, long-term financial reform proposals. The foundation of these proposals is not based on orthodox market failure economic models but rather on thermodynamics in general and the time evolution of Shannon information entropy in particular:
    Keywords: complexity science;financing fiscal gaps; health and Social Security; & macroeconomics
    JEL: I11 O11 H51
    Date: 2012–02–01
  26. By: Nguyen Viet, Cuong
    Abstract: Although there are numerous studies on impact evaluation of overall health insurance, little is known on the impact of health insurance on health care utilization and out-of-pocket health care spending of children, especially in developing countries. This paper measures the impact of child health insurance on health care utilization and spending of children from 6 to 14 years old in Vietnam using two recent nationally representative surveys. Unlike previous empirical studies which found a positive effect of health insurance on health care utilization in Vietnam, we did not find a statistically significant effect of school health insurance as well as free health insurance for children on outpatient health care contacts. However, the school health insurance and free health insurance help the insured children decrease out-of-pocket spending per outpatient contact by around 14 and 26 percent, respectively.
    Keywords: Child health insurance; impact evaluation; health care utilization; out-of-pocket spending; Vietnam
    JEL: G22 H51 H43 I10
    Date: 2011–06–21
  27. By: Aviva Aron-Dine; Liran Einav; Amy Finkelstein; Mark R. Cullen
    Abstract: We investigate whether individuals exhibit forward looking behavior in their response to the non-linear pricing common in health insurance contracts. Our empirical strategy exploits the fact that employees who join an employer-provided health insurance plan later in the calendar year face the same initial ("spot") price of medical care but a higher expected end-of-year ("future") price than employees who join the same plan earlier in the year. Our results reject the null of completely myopic behavior; medical utilization appears to respond to the future price, with a statistically significant elasticity of medical utilization with respect to the future price of -0.4 to -0.6. To try to quantify the extent of forward looking behavior, we develop a stylized dynamic model of individual behavior and calibrate it using our estimated behavioral response and additional data from the RAND Health Insurance Experiment. Our calibration suggests that the elasticity estimate may be substantially smaller than the one implied by fully forward-looking behavior, yet it is sufficiently high to have an economically significant effect on the response of annual medical utilization to a non-linear health insurance contract. Overall, our results point to the empirical importance of accounting for dynamic incentives in analyses of the impact of health insurance on medical utilization.
    JEL: D12 G22
    Date: 2012–02
  28. By: Kristian Bolin; Bjorn Lindgren
    Abstract: A number of behaviours influence health in a non-monotonic way. Physical activity and alcohol consumption, for instance, may be beneficial to one’s health in moderate but detrimental in large quantities. We develop a demand-for-health framework that incorporates the feature of a physiologically optimal level. An individual may still choose a physiologically non-optimal level, because of the trade-off in his or her preferences for health versus other utility-affecting commodities. However, any deviation from the physiologically optimal level will be punished with respect to health. A set of steady-state comparative statics is derived regarding the effects on the demand for health and health-related behaviour, indicating that individuals react differently to exogenous changes, depending on the amount of the health-related behaviour they demand. We also show (a) that a steady-state equilibrium is a saddle-point and (b) that the physiologically optimal level may be a steady-state equilibrium for the individual. Our analysis suggests that general public-health policies may, to some extent, be counterproductive due to the responses induced in part of the population.
    JEL: I12
    Date: 2012–01
  29. By: Michael Waldman; Sean Nicholson; Nodir Adilov
    Abstract: An extensive literature in medicine investigates the health consequences of early childhood television watching. However, this literature does not address the issue of reverse causation, i.e., does early childhood television watching cause specific health outcomes or do children more likely to have these health outcomes watch more television? This paper uses a natural experiment to investigate the health consequences of early childhood television watching and so is not subject to questions concerning reverse causation. Specifically, we use repeated cross-sectional data from 1972 through 1992 on county-level mental retardation rates, county-level autism rates, and county-level children’s cable-television subscription rates to investigate how early childhood television watching affects the prevalence of mental retardation and autism. We find a strong negative correlation between average county-level cable subscription rates when a birth cohort is below three and subsequent mental retardation diagnosis rates, but a strong positive correlation between the same cable subscription rates and subsequent autism diagnosis rates. Our results thus suggest that early childhood television watching has important positive and negative health consequences.
    JEL: I12
    Date: 2012–01

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