nep-hea New Economics Papers
on Health Economics
Issue of 2014‒02‒15
nine papers chosen by
Yong Yin
SUNY at Buffalo

  1. Prices and Quantities in Health Care Antitrust Damages By Martha A. Starr
  2. Health, financial incentives, and early retirement: Micro-simulation evidence for Germany By Hendrik Jürges; Lars Thiel; Tabea Bucher-Koenen; Johannes Rausch; Morten Schuth; Axel Börsch-Supan
  3. Seasonality in smoking behaviour: re-evaluating the effects of the 2005 public smoking ban in Italy By Del Bono, Emilia; Grunberger, Klaus; Vuri, Daniela
  4. The Effect of Drought on Health Outcomes and Health Expenditures in Rural Vietnam By Tobias Lechtenfeld; Steffen Lohmann
  5. The Effect OF Plan B on Teen Abortions: Evidence from the 2006 FDA Ruling By Inna Cintina; Morgen S. Johansen
  6. Coal, Smoke, and Death: Bituminous Coal and American Home Heating By Alan Barreca; Karen Clay; Joel Tarr
  7. Short-run Effects of Job Loss on Health Conditions, Health Insurance, and Health Care Utilization By Jessamyn Schaller; Ann Huff Stevens
  8. Economic Growth and Health Indicator in Thailand By durongkaveroj, wannaphong
  9. Market Inefficiency, Insurance Mandate and Welfare: U.S. Health Care Reform 2010 By Juergen Jung; Chung Tran

  1. By: Martha A. Starr
    Abstract: Antitrust analysis conventionally assumes that illegal agreements among competitors raise prices and lower quantities, relative to lawful competition. However, markets for healthcare services have tendencies towards overprovision, which may increase when competition declines. This paper examines this possibility using data from a well-known antitrust case in Wisconsin. We find that, in parts of the state where physician groups illegally divided up markets, costs of physician services rose by about 10% more than they did elsewhere, with about half of this increase due to increased services. This suggests that higher quantities can contribute to healthcare antitrust damages, along with higher prices.
    Date: 2014
  2. By: Hendrik Jürges (University of Wuppertal); Lars Thiel (University of Wuppertal); Tabea Bucher-Koenen (Munich Center for the Economics of Aging); Johannes Rausch (Munich Center for the Economics of Aging); Morten Schuth (Munich Center for the Economics of Aging); Axel Börsch-Supan (Munich Center for the Economics of Aging)
    Abstract: About 20% of German workers retire on disability pensions. Disability pensions provide fairly generous benefits for those who are not already age-eligible for an old-age pension and who are deemed unable to work for health reasons. In this paper, we use two sets of individual survey data to study the role of health and financial incentives in early retirement decisions in Germany, in particular disability benefit uptake. We show that financial incentives to retire do affect sick individuals at least as much as healthy individuals. Based on 25 years of individual survey data and empirical models of retirement behavior, we then simulate changes in the generosity of disability pensions to understand how these changes would affect retirement behavior. Our results show that making the disability benefit award process more stringent without closing other early retirement routes would not greatly increase labor force participation in old age.
    JEL: H55 J14 J26
    Date: 2014–02
  3. By: Del Bono, Emilia; Grunberger, Klaus; Vuri, Daniela
    Abstract: This paper investigates the impact of the public smoking ban which came into effect in Italy on January 2005 on individual smoking behaviour. Current empirical evidence supports the existence of a negative effect of the Italian ban on smoking prevalence and consumption in the general population. This is in contrast to what has been found in some other European coun- tries. Our analysis shows that the apparent success of the Italian smoking ban is due to the fact that existing results do not take into account seasonal differences in smoking behaviour. Using quarterly data from the 1999/2000 and 2004/2005 Italian Health Surveys and adopting a difference-in-difference approach that nets out monthly variation in smoking rates, we show that the Italian smoking ban had no impact on individual smoking behaviour for the population as a whole, and only small effects on some groups of individuals.
    Date: 2014–02–11
  4. By: Tobias Lechtenfeld (The World Bank Group); Steffen Lohmann (Georg-August-University Göttingen)
    Abstract: This paper studies the impact of droughts on health outcomes and health expenditures in rural Vietnam. Given the increasing frequency of extreme weather events in Vietnam and many developing countries, it is crucial for policy makers to be aware of the economic impact of such shocks at the micro level. Using local rainfall data, the analysis directly links the incidence of drought to health shocks and health-related expenditures from a multiple-wave panel of rural Vietnamese households. Overall, the results suggest that individuals affected by drought display a deterioration of health conditions and have significantly higher health expenditures. The effect is found to prevail among households with a high degree of agricultural dependency and limited access to coping mechanisms such as selling assets or tapping off-farm income sources. The preferred estimates using an IV strategy reveal that drought-related health shocks can cause non-negligible additional financial burden for many households vulnerable to poverty in rural Vietnam. This paper quantifies the immediate impact of drought on health conditions and contributes to the existing literature which has mostly focused on the long-term consequences.
    Keywords: climate shocks; drought; health; Vietnam
    JEL: I15 O15 Q54
    Date: 2014–02–06
  5. By: Inna Cintina (University of Hawaii Economic Research Organization); Morgen S. Johansen (Public Administration Program and Public Policy Center)
    Abstract: The 2006 FDA ruling made Plan B, the popular brand of emergency contraception (EC), available without a doctor's prescription to women 18 and older; women younger than 18 still have to produce a doctor's prescription for the drug. We hypothesize that since unplanned pregnancies are more likely to be terminated, an increase in the availability of EC may lead to a decrease in the abortion rate among women affected by the ruling. Therefore, in the absence of a change in the sexual risk taking, we expect to observe a decline in the abortion rate among women aged 18 and 19 after 2006, and expect no change in the abortion rate for women aged 15 and 16. We use the difference-in-difference methodology on the age-by-year-by-state abortion data to test this hypothesis. In contrast to the related literature, we find a moderate reduction in abortion rates among women age 18 and 19 in years after 2006 in states that were affected by the change, compared to changes in the control group in the same states. Yet, we do not observe a similar large change in abortion rates among women age 20-24.
    Keywords: Abortion; Adolescent; Emergency contraception; Plan B; Event study
    JEL: J18 J13
    Date: 2014–02
  6. By: Alan Barreca; Karen Clay; Joel Tarr
    Abstract: Air pollution was severe in many urban areas of the United States in the first half of the twentieth century, in part due to the burning of bituminous coal for heat. We estimate the effects of this bituminous coal consumption on mortality rates in the U.S. during the mid 20th century. Coal consumption varied considerably during the 20th century due to coal-labor strikes, wartime oil and gas restrictions, and the expansion of gas pipelines, among other reasons. To mitigate the influence of confounding factors, we use a triple-differences identification strategy that relies on variation in coal consumption at the state-year-season level. It exploits the fact that coal consumption for heating was highest in the winter and uses within-state changes in mortality in non-winter months as an additional control group. Our estimates suggest that reductions in the use of bituminous coal for heating between 1945 and 1960 decreased winter all-age mortality by 1.25 percent and winter infant mortality by 3.27 percent, saving 1,923 all age lives per winter month and 310 infant lives per winter month. Our estimates are likely to be a lower bound, since they primarily capture short-run relationships between coal and mortality.
    JEL: I18 N32 N52 Q53
    Date: 2014–02
  7. By: Jessamyn Schaller; Ann Huff Stevens
    Abstract: Job loss in the United States is associated with long-term reductions in income and long-term increases in mortality rates. This paper examines the short- to medium-term changes in health, health care access, and health care utilization after job loss that lead to these long-term effects. Using a sample with more than 9800 individual job losses and longitudinal data on a wide variety of health-related measures and outcomes, we show that job loss results in worse self-reported health, including mental health, but is not associated with statistically significant increases in a variety of specific chronic conditions. Among the full sample of workers, we see reductions in insurance coverage, but little evidence of reductions in health care utilization after job loss. Among the subset of displaced workers for whom the lost job was their primary source of insurance we do see reductions in doctor’s visits and prescription drug usage. These results suggest that access to health insurance and care may be an important part of the health effects of job loss for some workers. The pattern of results is also consistent with a significant role for stress in generating long-term health consequences after job loss.
    JEL: I1 J63
    Date: 2014–02
  8. By: durongkaveroj, wannaphong
    Abstract: This study aimed at estimating the relationship between economic growth measured by per capita Gross National Income (GNI) and health indicators including life expectancy and mortality rate under 5 in Thailand between 1980 - 2011 using Cochrane - Orcutt Model.The results from revealed that only mortality rate under 5 has a strong relationship with an economic growth. Thus, the reform in medical and sanitation system in Thailand will be able to stimulate the economic prosperity and lead to development further.
    Keywords: health indicator, economic growth, cochrane orcutt model
    JEL: I15 I18 O1
    Date: 2014–02–06
  9. By: Juergen Jung (Department of Economics, Towson University); Chung Tran (Research School of Economics, The Australian National University)
    Abstract: We quantify the effects of the Affordable Care Act using a stochastic general equilibrium overlapping generations model with endogenous health capital accumulation calibrated to match U.S. data on health spending and insurance take-up rates. The introduction of an insurance mandate and the expansion of Medicaid, that are at the core of the Affordable Care Act, increase the insurance coverage rate of workers from 76 to 90 percent while simultaneously causing a reduction in capital accumulation, labor supply and aggregate output. Individuals in poor health with low income experience welfare gains while high income individuals in good health experience welfare losses. The insurance mandate, enforced by penalties and subsidies, reduces the adverse selection problem in private health insurance markets and counteracts the crowding-out effect of the Medicaid expansion. In addition, an alternative design of the insurance mandate with more aggressive penalties can lead to universal insurance coverage at smaller efficiency and welfare losses.
    Keywords: Affordable Care Act 2010, insurance mandate, Medicaid, endogenous health capital, life-cycle health spending and financing, dynamic stochastic general equilibrium model, Grossman health capital.
    JEL: H51 I18 I38 E21 E62
    Date: 2014–02

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