nep-hea New Economics Papers
on Health Economics
Issue of 2016‒01‒29
fifteen papers chosen by
Yong Yin
SUNY at Buffalo

  1. Monitoring income-related health differences between regions in Great Britain: a new measurement framework By Paul Allanson
  2. What is really behavioral in behavioral health policy? And does it work? By Matteo M. Galizzi
  3. Direct cost of pars plana vitrectomy for the treatment of macular hole, epiretinal membrane and vitreomacular traction: a bottom-up approach By Elena Nicod; Timothy L. Jackson; Federico Grimaccia; Aris Angelis; Marc Costen; Richard Haynes; Edward Hughes; Edward Pringle; Hadi Zambarakji; Panos Kanavos
  4. Access to Medicines and European Market Integration By Fabio Pammolli; Armando Rungi
  5. The Concentration of Hospital-Based Medical Spending: Evidence from Canada By Aurelie Côté-Sergent; Damien Échevin; Pierre-Carl Michaud
  6. Investing in Health: A Macroeconomic Exploration of Short-Run and Long-Run Trade-Offs By Junying Zhao; William Scarth; Jeremiah Hurley
  7. Measuring Recent Apparent Declines in Longevity: The Role of Increasing Educational Attainment By John Bound; Arline T. Geronimus; Javier M. Rodriguez; Timothy A. Waidmann
  8. The Impact of Playworks on Students' Physical Activity by Race/Ethnicity: Findings from a Randomized Controlled Trial By Susanne James-Burdumy; Nicholas Beyler; Kelley Borradaile; Martha Bleeker; Alyssa Maccarone; Jane Fortson
  9. Critical Challenges in Making Health Services Research Relevant to Decision Makers By Marsha R. Gold
  10. Racial Difference in the Use of VA Health Services By Chichun Fang; Kenneth Langa; Helen Levy; David Weir
  11. Evaluating South Africa’s Tobacco Control Initative: A Synthetic Control Approach By Grieve Chelwa, Corné van Walbeek and Evan Blecher
  12. Absenteeism and productivity: the experience rating applied to employer contributions to health insurance By Sébastien Ménard; Coralia Quintero Rojas
  13. Social Insurance, Private Health Insurance and Individual Welfare By Kai Zhao
  14. The Impact of Nurse Turnover on Quality of Care and Mortality in Nursing Homes: Evidence from the Great Recession By Yaa Akosa Antwi; John R. Bowblis
  15. Valuing the benefits from health care interventions using life satisfaction data By Howley, P,;

  1. By: Paul Allanson
    Abstract: The paper proposes a new class of income-related health stratification indices that measure the extent to which differences in population health status between the regions of a country are systematically related to regional prosperity. The indices depend in general both on the degree to which the populations of different regions occupy well-defined layers or strata in the national distribution of the health outcome and on the scale of between-region differences in those outcomes if these are quantifiable, where the socioeconomic dimension is taken into account by ranking the regions in terms of economic prosperity rather than population health status. In particular, headcount and gap indices may be interpreted as measures of the overall incidence and depth of income-related health stratification between regions respectively, with the former well-defined for polytomous categorical variables without the need for etither dichotomisation or cardinalisation. The new measurement framework is used to examine the evolution of income-related health differences between the regions of Great Britain over the period from 1991 to 2008.
    Keywords: income-related health stratification, regional analysis, ordinal data
    JEL: D63 I14 I18
    Date: 2016–01
  2. By: Matteo M. Galizzi
    Abstract: Across health systems, there is increasing interest in applying behavioral economics insights to health policy challenges. Policy decision makers have recently discussed a range of diverse health policy interventions that are commonly brought together under a behavioral umbrella. These include randomized controlled trials, comparison portals, information labels, financial incentives, sin taxes, and nudges. A taxonomy is proposed to classify such behavioral interventions. In the context of risky health behavior, each cluster of policies is then scrutinized under two respects: (i) What are its genuinely behavioral insights? (ii) What evidence exists on its practical effectiveness? The discussion highlights the main challenges in drawing a clear mapping between how much each policy is behaviorally inspired and its effectiveness.
    Keywords: behavioral economics; behavioral policy; nudges; health behavior
    JEL: C90 I10 I18
    Date: 2014–03
  3. By: Elena Nicod; Timothy L. Jackson; Federico Grimaccia; Aris Angelis; Marc Costen; Richard Haynes; Edward Hughes; Edward Pringle; Hadi Zambarakji; Panos Kanavos
    Abstract: Purpose The direct cost to the National Health Service (NHS) in England of pars plana vitrectomy (PPV) is unknown since a bottom-up costing exercise has not been undertaken. Healthcare resource group (HRG) costing relies on a top-down approach. We aimed to quantify the direct cost of intermediate complexity PPV. Methods Five NHS vitreoretinal units prospectively recorded all consumables, equipment and staff salaries during PPV undertaken for vitreomacular traction, epiretinal membrane and macular hole. Out-of-surgery costs between admission and discharge were estimated using a representative accounting method. Results The average patient time in theatre for 57 PPVs was 72 min. The average in-surgery cost for staff was £297, consumables £619, and equipment £82 (total £997). The average out-of-surgery costs were £260, including nursing and medical staff, other consumables, eye drops and hospitalisation. The total cost was therefore £1634, including 30 % overheads. This cost estimate was an under-estimate because it did not include out-of-theatre consumables or equipment. The average reimbursed HRG tariff was £1701. Conclusions The cost of undertaking PPV of intermediate complexity is likely to be higher than the reimbursed tariff, except for hospitals with high throughput, where amortisation costs benefit from economies of scale. Although this research was set in England, the methodology may provide a useful template for other countries.
    Keywords: cost; macular hole; epiretinal membrane; vitreomacular traction; pars plana vitreoctomy
    JEL: I1
    Date: 2015
  4. By: Fabio Pammolli (IMT Institute for Advanced Studies Lucca & CEDRM Foundation); Armando Rungi (IMT Institute for Advanced Studies Lucca)
    Abstract: In this paper we document a process of price convergence in the European market for pharmaceuticals and relate it to access to innovative medicines in individual countries. The EU is a peculiar case study, where free circulation of goods exists, but pricing policies are designed and implemented by Member States. Thanks to a unique census database on product sales and launches for Â…fifteen EU countries, we detect a process of price convergence, both in nominal and in real terms. Therefore, we Â…nd that a faster rate of price convergence and a lower income per capita are associated with stronger delays in launches of new medicines. Moreover, country delays tend to be higher for innovative and Â…first in class chemical compounds. Our results suggest that inefficiencies arise from drugs regulation, when countries widely differ in income per capita, public Â…finance sustainability conditions, and regulatory frameworks. Policies of external reference pricing tend to exacerbate welfare losses. A policy of differential pricing is suggested, in order to take into account both therapeutic value and willingness to pay.
    Keywords: Economic integration, Price convergence, Product launches, European Single Market, Healthcare, Pharmaceutical industry, Pricing
    JEL: F15 I11 L65 L11 L51
    Date: 2016–01
  5. By: Aurelie Côté-Sergent; Damien Échevin; Pierre-Carl Michaud
    Abstract: In this paper, we present evidence on the concentration of hospital-based medical spending in Canada. We use longitudinal administrative data from the province of Quebec to document how medical spending is concentrated cross-sectionally, over time and finally near the end-of-life when death occurs at the hospital. Average expenditures rise rapidly with age, starting around the age of 50, and are concentrated in a small fraction of high-cost users. For example, the top 1% of men and women in terms of hospital spending account for 55.5% and 54.8% of total spending respectively. Persistence among high-users is rather low. Fewer than 3% of those in the top quintile of hospital spending stay in the same quintile the following year, fewer than 5% have any spending the following year. Finally, hospital spending among those in their last year of life and who die at the hospital can account for 11.1% of total hospital spending in the population. Most of that end-of-life spending, more than 80%, occurs in the last month of life.
    Keywords: Medical spending, concentration, end-of-life.
    JEL: I10 I13 I18
    Date: 2015
  6. By: Junying Zhao; William Scarth; Jeremiah Hurley
    Abstract: This paper aims to unravel the competing effects of the health investment. It explores, both analytically and numerically, the equilibrium shift and transitional dynamics after a one-time policy of health investment. We find that such a policy improves health status in the long run, but harms economic growth in both short and long term. The relative sizes of these competing effects depend on the specific health parameters. Within the plausible range for the value of health relative to consumption, households gain welfare in the long run as long as the eectiveness of labor in health production is large. The expanded health sector policy makes households worse off only if labor is rather unproductive in producing health and households value health relatively little. The findings challenge the policy recommendations of the World Bank (1993) and World Health Organization (2001) in that good health increases neither the productivity of workers nor the economic growth rate. It is hoped that the relative simplicity of our model, compared to the existing theoretical literature, can help close the gap between formal academic work on this topic and actual debates among policy makers in both developed and developing countries.
    Keywords: health capital, health investment, endogenous growth, dynamic system, transitional dynamics
    JEL: E2 E6 O4 I1
    Date: 2015–12
  7. By: John Bound; Arline T. Geronimus; Javier M. Rodriguez; Timothy A. Waidmann
    Abstract: Independent researchers have reported an alarming decline in life expectancy after 1990 among US non-Hispanic whites with less than a high school education.
    Keywords: Disparities, Epidemiology, Demography
    JEL: I
    Date: 2015–12–30
  8. By: Susanne James-Burdumy; Nicholas Beyler; Kelley Borradaile; Martha Bleeker; Alyssa Maccarone; Jane Fortson
    Abstract: The impact of Playworks was larger among minority students than among non-Hispanic white students.
    Keywords: Accelerometry, Intervention Study, Physical Activity, Youth
    JEL: I
    Date: 2015–07–13
  9. By: Marsha R. Gold
    Abstract: In this Commentary, the author discusses how the environment in which our research is received and used creates opportunities but also challenges to relevance that warrant greater consideration and active discussion within the health services research community.
    Keywords: health services research
    JEL: I
    Date: 2015–12–09
  10. By: Chichun Fang (University of Michigan); Kenneth Langa (University of Michigan); Helen Levy (University of Michigan); David Weir (University of Michigan)
    Abstract: We study the factors that affect the utilization of health care services administered by the Department of Veterans Affairs (VA) and its racial differences. Due to data limitation, previous research in this regard mostly only focuses on veterans who are VA users or at least eligible for VA services. We fill in the gap in literature with a random sample of veterans 51 and older from the Health and Retirement Study. We find that, among all veterans, those who are black and less healthy are more likely to use VA health services. These factors, nevertheless, are no longer statistically significant after the sample is restricted to veterans who are eligible for VA services. We also find that VA health services and services provided through other channels are at least partial substitutes: VA usage drops when a veteran becomes age eligible for Medicare or when a veteran has health insurance coverage through employment. This drop in usage holds not only among all veterans, but also among veterans eligible for VA services. Finally, perception about the quality of services delivered in VA versus non-VA facilities strongly predicts VA services usage. Those who have favorable views toward VA use VA services more, and the results from variance decomposition suggests a majority part of the racial difference in VA usage can be attributed to the racial difference in such perception.
    Date: 2015–09
  11. By: Grieve Chelwa, Corné van Walbeek and Evan Blecher
    Abstract: South Africa has since 1994 consistently and aggressively increased excise taxes on cigarettes in order to maintain a total tax burden of around 50% of the average retail selling price. The tax rises have translated into large increases in the inflation-adjusted price of cigarettes. For instance, the average real price per pack increased by 110% between 1994 and 2004. This paper uses a transparent and data-driven technique, the Synthetic Control method, to evaluate the impact on cigarette consumption of South Africa’s large-scale tobacco tax increases. We find that per capita cigarette consumption would not have continued declining in the absence of the consistent tax rises that began in 1994. Specifically, we find that by 2004, per capita cigarette consumption was 36% lower than it would have been had the tax increases not occurred. Our treatment effect estimates survive a series of placebo and robustness tests.
    Keywords: Policy evaluation; Counterfactual; Excise taxes; South Africa
    JEL: C01 C13 C40
    Date: 2015
  12. By: Sébastien Ménard; Coralia Quintero Rojas
    Date: 2015
  13. By: Kai Zhao (University of Connecticut)
    Abstract: This paper studies the impact of social insurance on private insurance and individualwelfare in a dynamic general equilibrium model with uncertain medical expenses and individual health insurance choices. I find that social insurance (modeled as a combination of the minimum consumption floor and the Medicaid program) crowds out private health insurance coverage, and this crowd-out is important for understanding the welfare consequences of social insurance. When the crowding out effect on private insurance is taken into account, the welfare gain from social insurance becomes substantially smaller and under some certain conditions it becomes a welfare loss. The intuition for these results is that the crowding out effect partially offsets the insurance benefits provided by social insurance. The findings of the paper suggest that it is important to consider the endogenous responses on private insurance choices when examining any social insurance policy reform. They also imply that the existence of social insurance programs may be one reason why some Americans do not buy any health insurance.
    Keywords: Saving, Uncertain Medical Expenses, Health Insurance, Means Testing
    JEL: E20 E60 H30 I13
    Date: 2016–01
  14. By: Yaa Akosa Antwi (Indiana University - Purdue University Indianapolis); John R. Bowblis (Miami University)
    Abstract: We estimate the causal effect of nurse turnover on mortality and the quality of nursing home care with a fixed effect instrumental variable estimation that uses the unemployment rate as an instrument for nursing turnover. We find that ignoring endogeneity leads to a systematic underestimation of the effect of nursing turnover on mortality and quality of care in a sample of California nursing homes. Specifically, 10 percentage point increase in nurse turnover results in a facility receiving 2.2 additional deficiencies per annual regulatory survey, reflecting a 19.3 percent increase. Not accounting for endogeneity of turnover leads to results that suggest only a 1 percent increase in deficiencies. We also find suggestive evidence that turnover results in lower quality in other dimensions and may increase mortality. An implication of our mortality results is that turnover may be a mechanism for the procyclicality of mortality rates.
    Keywords: Employee turnover, unemployment rate, quality of care, nursing home
    JEL: I11 J21 E24
    Date: 2016–01
  15. By: Howley, P,;
    Abstract: This paper uses life satisfaction data to calculate the extent to which individuals are willing to trade money for improvements in their health status. Using a large nationally representative survey in the UK, I showthat the amount of extra equivalent household income to make someone with a health condition, as well off in terms of life satisfaction as someone without the health condition, ranges from a low of £4,235 per annum for impairments associated with asthma to a high of £31,283 for impairments associated with congestive heart failure. These values could be used as a basis for a cost-benefit analysis of health care interventions aimed at the medical conditions examined. Relative to previous work, I address a number of critical empirical challenges when it comes to using this compensating income variation approach for determining the monetary value of a health improvement. First, I address the issue of income endogeneity in life satisaction by instrumenting income with the educational status of respondents’ parents. Second, I control for the potentially confounding role of personality differences by including a measure of the Big Five personality traits in the micro-econometirc analysis of life satisfaction.
    Keywords: life satisfaction; compensating income variation; instrumental variables; health conditions;
    JEL: I1 I31
    Date: 2016–01

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