nep-hea New Economics Papers
on Health Economics
Issue of 2014‒05‒24
eighteen papers chosen by
Yong Yin
SUNY at Buffalo

  1. Using cost-effectiveness thresholds to determine value for money in low- and middle-income country healthcare systems: Are current international norms fit for purpose? By Paul Revill; Simon Walker; Jason Madan; Andrea Ciaranello; Takondwa Mwase; Diana M Gibb; Karl Claxton; Mark J Sculpher
  2. Quality and hospital choice for cataract treatments: the winner takes most By Suzanne Ruwaard; Rudy Douven
  3. Being Born Out-of-Wedlock: Does it affect a Child’s Survival Chance? An Empirical Investigation for Senegal By Nathalie Guilbert; Karine Marazyan
  4. The Roadside Healthcare Facility Location Problem By de Vries, H.; Klundert, J.J.; Wagelmans, A.P.M.
  5. Sickness and death: economic consequences and coping strategies of the urban poor in Bangladesh By Khan, F.U.; Arjun S. Bedi; Sparrow, R.A.
  6. Does Initial Job Status Affect Midlife Outcomes and Mental Health? Evidence from a survey in Japan By OSHIO Takashi; INAGAKI Seiichi
  7. Environmental taxation, health and the life-cycle By Nathalie Mathieu-Bolh; Xavier Pautrel
  8. Weather and Welfare: Health and Agricultural Impacts of Climate Extremes, Evidence from Mexico By Federico Guerrero
  9. Does Birth Underregistration Reduce Childhood Immunization?: Evidence from the Dominican Republic By Rene Osorio Rivas; Steve Brito; Ana Corbacho
  10. Long-Term Effect of Climate Change on Health: Evidence from Heat Waves in Mexico By Jorge M. Agüero
  11. Climate Change Impacts on Birth Outcomes in Brazil By Paula C. Pereda; Tatiane A. de Menezes; Denisard Alves
  12. "Healthy, wealthy, and wise?" revisited: An analysis of the causal pathways from socio-economic status to health By Stowasser, Till; Heiss, Florian; McFadden, Daniel; Winter, Joachim
  13. Understanding the SES gradient in health among the elderly: The role of childhood circumstances By Stowasser, Till; Heiss, Florian; McFadden, Daniel; Winter, Joachim
  14. More Insurers Lower Premiums: Evidence from Initial Pricing in the Health Insurance Marketplaces By Leemore Dafny; Jonathan Gruber; Christopher Ody
  15. The effects of cancer in the English labour market By David Candon
  16. A formal investigation of inequalities in health behaviours after age 50 on the Island of Ireland By Eibhlin Hudson; David Madden; Irene Mosca
  17. Does Grief Transfer across Generations? - In-Utero Deaths and Child Outcomes By Sandra E Black; Paul J Devereux; Kjell G Salvanes
  18. The impact of low emission zones on particulate matter concentration and public health By Malina, Christiane; Fischer, Frauke

  1. By: Paul Revill (Centre for Health Economics, University of York, UK); Simon Walker (Centre for Health Economics, University of York, UK); Jason Madan (Warwick Medical School, University of Warwick, UK); Andrea Ciaranello (Massachusetts General Hospital, Massachusetts, USA); Takondwa Mwase (Abt Associates, Lilongwe, Malawi); Diana M Gibb (5Medical Research Council Clinical Trials Unit (MRC CTU), at University College London, UK); Karl Claxton (Centre for Health Economics, University of York, UK); Mark J Sculpher (Centre for Health Economics, University of York, UK)
    Abstract: Healthcare systems in low- and middle-income countries face considerable population healthcare needs with markedly fewer resources than those in higher income countries. The way in which available resources are allocated across competing priorities has a profound effect on how much health is generated overall, who receives healthcare interventions and who goes without. Judgements about whether interventions and programmes should be regarded as cost-effective and prioritised over others should be based on an assessment of the health benefits that will be lost because the resources required will not be available to implement other effective interventions and programmes that would benefit other patients in the same or different disease areas. Unfortunately, frequently adopted international norms, in particular the cost-effectiveness thresholds recommended by the World Health Organization (WHO), are not founded on this type of assessment. Consequently current judgements about which interventions and programmes are cost-effective are often aspirational and do not reflect the reality of resource constraints. As a consequence their use is likely to reduce overall population health and exacerbate healthcare inequalities. They also fail to identify the real (and greater) value of devoting more resources to these efforts. By obscuring the true implications of current arrangements they do not contribute to greater understanding of and accountability for global and local decisions made on behalf of populations in low and middle as well as in high income countries. We illustrate these points using examples from HIV/AIDS.
    Date: 2014–05
  2. By: Suzanne Ruwaard; Rudy Douven
    Abstract: We study the impact of quality on patient volume and hospital choice for cataract treatments. Our dataset covers the period 2006-2011 and includes all 854,613 patients who underwent a cataract treatment in the Netherlands. At the aggregate-level we find that, a one-point quality increase, on a scale of one to a hundred, would raise patient volume for the average hospital by 2-4%. This effect is mainly due to the performance of the top performing hospital. This effect halves after excluding this hospital from the dataset. Also at the individual-level, we find, all else being equal, that patients are willing to travel an additional 11km or more for the top performing as opposed to other hospitals. Our results suggest that the impact of quality on patient volume and willingness to travel is non-linear. Only the top performing hospital is able to attract significantly more patients.
    JEL: I11 D12 C25
    Date: 2014–05
  3. By: Nathalie Guilbert (PSL, Université Paris-Dauphine, LEDa, UMR DIAL, IRD); Karine Marazyan (Université Paris 1 - IEDES- IRD UMR 201 Développement et Sociétés)
    Abstract: (english) In this paper, we are interested in the effect of birth status, being born out-of-wedlock or in wedlock, on survival chance before two years old of siblings of same gender in Senegal. The analysis is based on nationally representative data, those from the Demographic and health survey, collected in the country in 2010-2011. Data from the youngest cohort of mothers are exploited. On average, no significant effect is found. This masks significant variations between sub-groups of children. However, contrary to initial expectations, children born out-of-wedlock have similar mortality rate than their siblings born in wedlock, at worst. In some case, their mortality rate is lower. This suggests that resource-based mechanisms exist in Senegal that helps mothers, with an out-of-wedlock birth, to compensate and sometime over-compensate for lack of resource or for fragility. These mechanisms seem to vary between areas and ethnic groups depending on the gender of the child born out-ofwedlock. The only group of children with a higher risk of death is the group of girls born out-ofwedlock, whose mother was adolescent when giving birth to them, belonging to the Serere ethnic group. Informal, private compensatory mechanism does not seem to take place in this specific case. _________________________________ (français) Cet article s'intéresse aux conséquences du statut à la naissance, être né dans le cadre d'une union maritale ou non, sur les chances de survie au cours des deux premières années de vie d'enfants de même sexe et issus d'une même fratrie au Sénégal. L'analyse est réalisée à partir des données des enquêtes démographiques et de santé collectées dans le pays en 2010-2011 et représentatives au niveau national. L'échantillon utilisé pour l'analyse est celui des mères appartenant aux plus jeunes cohortes. En moyenne, nous n'observons pas d'impact significatif d'être né hors mariage sur la mortalité des enfants relativement à leurs frères et soeurs de même sexe nés dans le cadre d'un mariage. Cependant, ce résultat masque des différences importantes parmi plusieurs sous-groupes d'enfants. Contrairement aux attentes initiales, les enfants nés hors mariage ont des taux de mortalité similaires à leurs frères et soeurs nés dans le cadre d'un mariage et, dans certains cas, ils présentent même des taux de mortalité plus faibles. Ces résultats suggèrent l'existence de mécanismes de solidarité au Sénégal qui aident les mères ayant eu une naissance hors mariage à compenser et parfois même surcompenser un manque de ressources ou une plus forte vulnérabilité. Ces mécanismes semblent varier par zones géographiques et groupes ethniques en fonction du sexe de l'enfant né hors mariage. Seules les filles nées hors mariage appartenant au groupe ethnique des Sérères et dont la mère était adolescente à la naissance de son premier enfant, présentent un risque de mortalité plus élevé. Des mécanismes compensatoires privés informels ne semblent pas s'établir dans ce cas spécifique.
    Keywords: Premarital fecundity, marriage, children’s mortality, Senegal, Fécondité prémaritale, mariage, mortalité infantile, Sénégal.
    JEL: I2 J1 O1
    Date: 2013–10
  4. By: de Vries, H.; Klundert, J.J.; Wagelmans, A.P.M.
    Abstract: __Abstract__ Providing African truck drivers with adequate access to healthcare is an effective way to reduce the burden and the spread of HIV and other infectious diseases. Therefore, NGO North Star Alliance builds a network of healthcare facilities along major African trucking routes. Choosing the locations of new facilities presents novel and complex optimization problems. This paper considers a general design problem: the Roadside Health Care Facility location Problem (RHFLP). RFHLP entails to select locations for new facilities and to choose for each of these facilities whether or not to add healthcare services for HIV, STIs, Tuberculosis, and/or Malaria to the standard health service package. The objective combines the maximization of the truck driver patient volume at these facilities and the maximization of the extent to which the truck drivers have continuous access to the needed health service packages. We present three measures for continuous access to health services by mobile patients and integrate these measures in a mixed-integer programming formulation for RHFLP. Moreover, we prove the RHFLP to be strongly NP-hard and derive analytical results for the worst-case effects of impreciseness in the input data. We show how large scale real life problem instances can be solved, presenting numerical experiments for the North-South corridor network (Southern and Eastern Africa) and discuss policy implications.
    Keywords: roadside healthcare, truck drivers, facility location, continuous access
    Date: 2014–04–29
  5. By: Khan, F.U.; Arjun S. Bedi; Sparrow, R.A.
    Abstract: This paper investigates the economic consequences of sickness and death and the manner in which poor urban households in Bangladesh respond to such events. Based on longitudinal data we assess the effects of morbidity and mortality episodes on household income, medical spending, labour supply and consumption. We find that despite maintaining household labour supply, a serious illness exerts a negative effect on household income for the poor. However, the estimates do not reject consumption smoothing. The most prominent response to finance current needs is to borrow from money lenders, which leads to an increase in household debt-to-income ratios with possible detrimental effects on future consumption.
    Keywords: Sickness, death, income, labour supply, coping strategies, Bangladesh.
    Date: 2014–05–15
  6. By: OSHIO Takashi; INAGAKI Seiichi
    Abstract: This article examines how initial job status following graduation affects the midlife outcomes and mental health of Japanese workers, using micro data from a nationwide online survey of 3,117 men and 2,818 women aged 30-60. The focus was the impact of initial job status on socioeconomic/marital status and mental health during the person's midlife period. It was found that failure to obtain regular employment at the time of graduation raised the probabilities of unstable job status throughout the person's life, low household income, unmarried status, and psychological distress. The impact of initial job status on current mental health was not mediated fully by the current socioeconomic/marital status, particularly for women. Unlike general observations from Europe, this study suggests that unstable initial job status reduces opportunities for future success and has a traumatic effect on mental health.
    Date: 2014–05
  7. By: Nathalie Mathieu-Bolh (University of Vermont - University of Vermont); Xavier Pautrel (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - Université de Nantes : EA4272)
    Abstract: We build a model that takes into consideration the evolution of health over the life cycle and its consequences on individual optimal choices. In this framework, the effects of environmental taxation are not limited to the traditional negative crowding-out and positive productivity effects. We show that environmental taxation generates new general equilibrium effects ignored by previous contributions. Indeed, as the environmental tax improves the health profile over the life-cycle, it influences saving, labor supply, and retirement. We also show that whether those general equilibrium effects are positive or negative for the economy crucially depends on the degree of substitutability between young and old labor. Our numerical examples suggest that ignoring those new effects may result in large overstatement of the negative effect of an increase in environmental taxation on output, and understatement of the positive effect on welfare. ∗
    Keywords: Health ; environmental policy ; economic growth
    Date: 2014–05–13
  8. By: Federico Guerrero
    Abstract: Using data for all 2,454 municipalities of Mexico for the period 1980-2010, this paper analyzes the relationship between exposure to extreme temperatures and precipitation and death, as well as the relationship between severe weather and agricultural income and crop production in the country. It is found that extreme heat increases mortality, while the health effect of extreme cold is generally trivial. Precipitation extremes seem to affect the agricultural system, but their impact on mortality is ambiguous. More specifically, exchanging one day with a temperature of 16-18 °C for one day with temperatures higher than 30 °C increases the crude mortality rate by 0. 15 percentage points, a result robust to several model specifications. It is also found that the extreme heat effect on death is significantly more acute in rural regions, leading to increases of up to 0. 2 percentage points vis-à-vis a 0.07-point increase in urban areas. The timing of climate extremes is relevant: if a weather shock takes place during the agricultural growing season, the effects on mortality and agricultural output, productivity, prices, and crop yields are large and significant, but not so if such shocks occur during the non-growing season.
    Keywords: Climate Change, Agricultural research & extension, IDB-WP-391
    Date: 2013–02
  9. By: Rene Osorio Rivas; Steve Brito; Ana Corbacho
    Abstract: Birth registration is not only a fundamental human right, but also a requirement for obtaining additional documents, proving legal identity, and accessing a number of government benefits. Yet, little is known about the effects of birth under-registration on access to health care. Using data from the Dominican Republic, this paper is the first to shed light on the causal impact of the lack of birth registration on childhood immunization, one of the key components of public services in many developing countries. Controlling for potential endogeneity and standard socioeconomic determinants of immunization, this paper finds that children between 0 and 59 months of age that do not have birth certificates are behind by nearly one vaccine (out of a total of nine) compared to those that have birth certificates. The results are robust to several robustness tests and threats to the exclusion restriction of the instrumental variables. Birth under-registration specifically reduces the probability of vaccination against polio, diphtheria, pertussis, and tetanus--once leading causes of child morbidity and infant mortality. In addition, untimely vaccination costs governments billions per year in treatment and rehabilitation.
    Keywords: Civil Registration, Immunization; Under-registration
    Date: 2013–12
  10. By: Jorge M. Agüero
    Abstract: This paper uses year-to-year variation in temperature to estimate the long-term effects of climate change on health outcomes in Mexico. Combining temperature data at the district level and three rounds of nationally representative household surveys, an individual's health as an adult is matched with the history of heat waves from birth to adulthood. A flexible econometric model is used to identify critical health periods with respect to temperature. It is shown that exposure to higher temperatures early in life has negative consequences on adult height. Most importantly, the effects are concentrated at the times where children experience growth spurts: infancy and adolescence. The robustness of these findings is confirmed when using health outcomes derived from accidents, which are uncorrelated with early exposure to high temperatures.
    Keywords: Human health, Climate Change
    Date: 2014–01
  11. By: Paula C. Pereda; Tatiane A. de Menezes; Denisard Alves
    Abstract: This paper attempts to identify the climatic effect on birth outcomes in Brazil and, thus, to predict the potential impact of climate change. Panel data models indicate that excess and lack of rainfall have the most important harmful effects on newborns' health; temperature stresses and low relative humidity also have effects. The use of climate change forecasts for Brazil suggests a possible increase of 305 neonatal deaths annually and, for families in the Primary Care Program, three thousand additional low-weight births each year. The paper further examines public policy's role in minimizing the effects of extreme weather. Mothers' education, sanitation access and health care assistance to pregnant women represent the main instruments for addressing neonatal health problems.
    Keywords: Health Care, Environmental economics, Health Policy, Climate Change, Low humidity, Extreme weather events, High humidity, Neonatal mortality rate, Low birthweight, Heat stress, Change impacts, Birth outcomes, Neonatal mortality, IDB-WP-495
    Date: 2014–04
  12. By: Stowasser, Till; Heiss, Florian; McFadden, Daniel; Winter, Joachim
    Abstract: Much has been said about the stylized fact that the economically successful are not only wealthier but also healthier than the less affluent. There is little doubt about the existence of this socio-economic gradient in health, but there remains a vivid debate about its source. In this paper, we review the methodological challenges involved in testing the causal relationships between socio-economic status and health. We describe the approach of testing for the absence of causal channels developed by Adams et al. (2003) that seeks identification without the need to isolate exogenous variation in economic variables, and we repeat their analysis using the full range of data that have become available in the Health and Retirement Study since, both in terms of observations years and age ranges covered. This analysis shows that causal inference critically depends on which time periods are used for estimation. Using the information of longer panels has the greatest effect on results. We find that SES causality cannot be ruled out for a larger number of health conditions than in the original study. An approach based on a reduced-form interpretation of causality thus is not very informative, at least as long as the confounding influence of hidden common factors is not fully controlled.
    Keywords: health; wealth; socio-economic gradient; causal inference; Granger causality; individual heterogeneity
    JEL: C33 I0 I12
    Date: 2014–05–14
  13. By: Stowasser, Till; Heiss, Florian; McFadden, Daniel; Winter, Joachim
    Abstract: Individuals’ socioeconomic status (SES) is positively correlated with their health status. While the existence of this gradient may be uncontroversial, the same cannot be said about its explanation. In this paper, we extend the approach of testing for the absence of causal channels developed by Adams et al. (2003), which in a Granger causality sense promises insights on the causal structure of the health-SES nexus. We introduce some methodological refinements and integrate retrospective survey data on early childhood circumstances into this framework. We confirm that childhood health has lasting predictive power for adult health. We also uncover strong gender differences in the intertemporal transmission of SES and health: While the link between SES and functional as well as mental health among men appears to be established rather late in life, the gradient among women seems to originate from childhood circumstances.
    Keywords: health; wealth; socio-economic gradient; causal inference; Granger causality; individual heterogeneity; childhood health; childhood circumstances
    JEL: C33 I0 I12
    Date: 2014–05–14
  14. By: Leemore Dafny; Jonathan Gruber; Christopher Ody
    Abstract: First-year insurer participation in the Health Insurance Marketplaces (HIMs) established by the Affordable Care Act is limited in many areas of the country. There are 3.9 participants, on (population-weighted) average, in the 395 ratings areas spanning the 34 states with federally facilitated marketplaces (FFMs). Using data on the plans offered in the FFMs, together with predicted market shares for exchange participants (estimated using 2011 insurer-state market shares in the individual insurance market), we study the impact of competition on premiums. We exploit variation in ratings-area-level competition induced by United Healthcare’s decision not to participate in any of the FFMs. We estimate that United’s nonparticipation decision raised the second-lowest-price silver premium (which is directly linked to federal subsidies) by 5.4 percent, on average. If all insurers active in each state’s individual insurance market in 2011 had participated in all ratings areas in that state’s HIM, we estimate this key premium would be 11.1% lower and 2014 federal subsidies would be reduced by $1.7 billion.
    JEL: H51 I11 I18 L1
    Date: 2014–05
  15. By: David Candon (School of Economics and Geary Institute, University College Dublin)
    Abstract: The continued rise in overall cancer survival rates has ignited a field of research which examines the effect that cancer has on survivors’ employment. Previous estimates of the effect of cancer on labour market outcomes, using U.S. data, show a significant reduction in employment and hours of work in the first 6 months after diagnosis. However, this impact has been found to dissipate after 2 years. I use data from the English Longitudinal Study of Ageing (ELSA) and find that, not only does cancer have a negative impact in the first 6-month period following diagnosis, but also in the second 6-month period. I estimate that, in the second 6-month period after diagnosis, respondents with cancer are 20.7 percentage points less likely to work and work 24% less hours a week when compared to matched, healthy controls. This suggests that the negative effects from cancer can persist for longer than the 6 months identified in previous studies. Results are significant at the 1% level. These results have implications for government policy and employers, because it increases both the length of time that survivors may be on government supported sick pay and the expected time that workers will be absent from work due to illness.
    Keywords: Labour market; Cancer; Employment; Hours worked
    JEL: I10 J21 J22
    Date: 2014–05–09
  16. By: Eibhlin Hudson (Trinity College Dublin); David Madden (University College Dublin); Irene Mosca (Trinity College Dublin)
    Abstract: Smoking, low physical activity and frequent alcohol consumption may have substantial health risks in terms of disease, quality of life and mortality. Understanding inequality in relation to these behaviours among older people is important in the context of a rapidly ageing population. In this study, we examine income-related inequality in relation to these three key health behaviours using data on older adults from both the Republic of Ireland and Northern Ireland. We employ concentration indices and decompose them to determine the factors which contribute most to inequality. We then examine whether differences exist between the two regions. We find that smoking and low physical activity are more concentrated among those with lower incomes in both regions. In relation to physical activity, the magnitude of the inequality is higher for Northern Ireland. Frequent alcohol consumption is more concentrated among those with higher incomes in both regions. Self-assessed health and age tend to feature prominently for all behaviours in terms of contribution to inequality. Marital status and labour market status tend to play a less pronounced role. In terms of Northern Ireland/Republic of Ireland comparisons with respect to the decompositions, probably the biggest difference is to be observed in the greater role accorded to labour market status in the Republic. For the other factors, the orders of magnitude are reasonably similar. This suggests that in many cases it may be the same underlying factors which lie behind income related inequalities.
    Keywords: inequality; health behaviours; older adults; Republic of Ireland; Northern Ireland
    JEL: I14 J14
    Date: 2014–02–18
  17. By: Sandra E Black (University of Texas); Paul J Devereux (University College Dublin); Kjell G Salvanes (Norwegian School of Economics)
    Abstract: While much is now known about the effects of physical health shocks to pregnant women on the outcomes of the in-utero child, we know little about the effects of psychological stresses. One clear form of stress to the mother comes from the death of a parent. We examine the effects of the death of the mother’s parent during pregnancy on both the short-run and the long-run outcomes of the infant. Our primary specification involves using mother fixed effects— comparing the outcomes of two children with the same mother but where a parent of the mother died during one of the pregnancies—augmented with a control for whether there is a death around the time of the pregnancy in order to isolate true causal effects of a bereavement during pregnancy. We find small negative effects on birth outcomes, and these effects are bigger for boys than for girls. The effects on birth outcomes seems to be driven by deaths due to cardiovascular causes suggesting that sudden deaths are more difficult to deal with. However, we find no evidence of adverse effects on adult outcomes. The results are robust to alternative specifications.
    Keywords: Intergenerational Transmission, Fetal Origins
    Date: 2014–03–19
  18. By: Malina, Christiane; Fischer, Frauke
    Abstract: A common policy for reducing particulate matter concentrations in the European Union is the introduction of Low Emission Zones (LEZs), which may only be entered by vehicles meeting predefined emission standards. This paper examines the effectiveness of LEZs for reducing PM10 levels in urban areas in Germany and quantifies the associated health impacts from reduced air pollution within the zones. We employ a fixed effects panel data model for daily observations of PM10 concentrations from 2000 to 2009 and control, inter alia, for local meteorological conditions and traffic volume. We apply the regression outputs to a concentration response function derived from the epidemiological literature to calculate associated health impacts of the introduction of LEZs in 25 German cities with a population of 3.96 Mio. Associated uncertainties are accounted for in Monte-Carlo simulations. It is found that the introduction of LEZs has significantly reduced inner city PM10 levels. We estimate the total mean health impact from reduced air pollution in 2010 due to the introduction of stage 1 zones to be ~700 Mio. EUR in the 25 LEZ-cities in the sample, whereas total mean health benefits are ~2.4 Billion EUR for the more stringent stage 2 zones when applied to the same cities. --
    Keywords: Environmental policy,Germany,low emission zones,road transport,particulate matter,health effects
    Date: 2014

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