nep-hea New Economics Papers
on Health Economics
Issue of 2017‒02‒26
thirty-one papers chosen by
Yong Yin
SUNY at Buffalo

  1. With a Little Help from My Friends: The Effects of Naloxone Access and Good Samaritan Laws on Opioid-Related Deaths By Daniel I. Rees; Joseph J. Sabia; Laura M. Argys; Joshua Latshaw; Dhaval Dave
  2. The Returns to Nursing: Evidence from a Parental Leave Program By Benjamin U. Friedrich; Martin B. Hackmann
  3. Sticking Points: Common-Agency Problems and Contracting in the U.S. Healthcare System By Brigham Frandsen; Michael Powell; James B. Rebitzer
  4. Impact and Efficiency of the Integration of Diagnosis and Treatment of Pneumonia in Malaria Community Case Management in Madagascar By Marilys Victoire RAZAKAMANANA; Martine AUDIBERT; Tantely ANDRIANANTOANDRO; Aina HARIMANANA
  5. Vog: Using Volcanic Eruptions to Estimate the Health Costs of Particulates By Timothy Halliday; John Lynham; Ã ureo de Paula
  6. Decomposing health inequality in the EU By MAZEIKAITE Gintare; O?DONOGHUE Cathal; SOLOGON Denisa
  7. Health, Human Capital and Domestic Violence By Nicholas W. Papageorge; Gwyn C. Pauley; Mardge Cohen; Tracey E. Wilson; Barton H. Hamilton; Robert A. Pollak
  8. Evaluating Measures of Hospital Quality By Joseph J. Doyle, Jr.; John A. Graves; Jonathan Gruber
  9. The Distribution of Public Spending for Health Care in the United States on the Eve of Health Reform By Didem Bernard; Thomas Selden; Yuriy Pylypchuk
  10. Fertility, Mortality and Environmental Policy By Lehmijoki, Ulla; Palokangas, Tapio K.
  11. The impact of differentiated access to income and wealth on health and wellbeing outcomes: a longitudinal Australian study By Garth Kendall; Ha Trong Nguyen; Rachel Ong
  12. Design of the CMS Medical Home Demonstration By Myles Maxfield; Deborah Peikes; Rachel Shapiro; Hongmai Pham; Ann O'Malley; Sarah Scholle; Phyllis Torda
  13. Improving the Outcomes of Youth with Medical Limitations Through Comprehensive Training and Employment Services: Evidence from the National Job Corps Study By Heinrich Hock; Dara Lee Luca; Tim Kautz; David Stapleton
  14. The dynamics of informal care provision in an Australian household panel survey: previous work characteristics and future care provision. By Ha Trong Nguyen; Luke B Connelly
  15. Dimensions of Quality of Life in Germany: Measured by Plain Text Responses in a Representative Survey (SOEP) By Gert G. Wagner; Martin Bruemmer; Axel Glemser; Julia Rohrer; Jürgen Schupp
  16. The individual level cost of pregnancy termination in Zambia: a comparison of safe and unsafe abortion By Tiziana Leone; Ernestina Coast; Divya Parmar; Bellington Vwalika
  17. The International Epidemiological Transition and the Education Gender Gap By Klasing, Mariko Jasmin; Klasing, Mariko J.; Milionis, Petros
  18. Optimal Incentives for Patent Challenges in the Pharmaceutical Industry By Böhme, Enrico; Frank, Severin; Kerber, Wolfgang
  19. Camouflage and Ballooning in Health Insurance: Evidence from Abortion By Neumann, Julia Kathleen; Zweifel, Peter; Hofmann, Annette
  20. Reimbursement Schemes for Hospitals: Evidence from a Natural Experiment in Germany By Wohlschlegel, Ansgar; Feess, Eberhard; Mueller, Helge
  21. Birth Order and Health of Newborns: What Can We Learn from Danish Registry Data? By Molitor, Ramona; Anne , Ardila Brenøe
  22. Going from Bad to Worse: Adaptation to Poor Health, Health Spending, Longevity, and the Value of Life By Schünemann, Johannes; Strulik, Holger; Trimborn, Timo
  23. Cyclical vs structural effects on health care expenditure trends in OECD countries By Luca Lorenzoni; Jonathan Millar; Franco Sassi; Douglas Sutherland
  24. Determinants of Obesity in Turkey: A Quantile Regression Analysis from a Developing Country By Deniz Karaoğlan; Aysıt Tansel
  25. Efficiency of township hospitals in China in the context of the drug policy reform: Progress should not get bogged in midstream - A case study from a survey in Weifang prefecture. By Laurène PETITFOUR; Xiezhe HUANGFU; Martine AUDIBERT; Jacky MATHONNAT
  26. Health, Health Insurance, and Retirement: A Survey By French, Eric; Jones, John Bailey
  27. Does democracy reduce the HIV epidemic? Evidence from Kenya By Antoine MARSAUDON; Josselin THUILLIEZ
  28. Malpractice Claim Fears and the Costs of Treating Medicare Patients: A New Approach to Estimating the Costs of Defensive Medicine By James D. Reschovsky; Cynthia B. Saiontz-Martinez
  29. Did Medicaid Expansion Reduce Medical Divorce? By David Slusky; Donna Ginther
  30. The Effect of Prescription Drug Monitoring Programs on Opioid Utilization in Medicare By Thomas C. Buchmueller; Colleen Carey
  31. Cost-sharing in health insurance and its impact in a developing country– Evidence from a quasi-natural experiment Abstract: Though the impact of cost-sharing on health care demand is well documented in developed countries, evidence from developing countries is rare. This paper’s contribution is to analyse the impact of increasing coinsurance in a developing nation -Vietnam – by exploiting a quasi-natural experiment in that country. In 2007, the Vietnam government reintroduced a 20 percent coinsurance for individuals who hold voluntary health insurance policies. As individuals with compulsory health insurance were exempt from this re-imposition of coinsurance, this policy change may be regarded as a quasi-natural experiment. To exploit this change, we use a difference-in-difference approach to examine whether the increase in coinsurance effectively reduced the demand for health care services among those affected. We find it has no statistically significant effect on the quantity of health care demanded. We however find that those who were under 18 or in low income households reduced their health care use after the increase in coinsurance. These findings hold – at least in the short-run, with a variety of different outcomes and estimators. By Ha Trong Nguyen; Luke B Connelly

  1. By: Daniel I. Rees; Joseph J. Sabia; Laura M. Argys; Joshua Latshaw; Dhaval Dave
    Abstract: In an effort to address the opioid epidemic, a majority of states have recently passed some version of a Naloxone Access Law (NAL) and/or a Good Samaritan Law (GSL). NALs allow lay persons to administer naloxone, which temporarily counteracts the effects of an opioid overdose; GSLs provide immunity from prosecution for drug possession to anyone who seeks medical assistance in the event of a drug overdose. This study is the first to examine the effect of these laws on opioid-related deaths. Using data from the National Vital Statistics System multiple cause-of-death mortality files for the period 1999-2014, we find that the adoption of a NAL is associated with a 9 to 11 percent reduction in opioid-related deaths. The estimated effect of GLSs on opioid-related deaths is of comparable magnitude, but not statistically significant at conventional levels. Finally, we find that neither NALs nor GSLs increase the recreational use of prescription painkillers.
    JEL: H0 I1 K0
    Date: 2017–02
  2. By: Benjamin U. Friedrich; Martin B. Hackmann
    Abstract: Nurses comprise the largest health profession. In this paper, we measure the effect of nurses on health care delivery and patient health outcomes across sectors. Our empirical strategy takes advantage of a parental leave program, which led to a sudden, unintended, and persistent 12% reduction in nurse employment. Our findings indicate detrimental effects on hospital care delivery as indicated by an increase in 30-day readmission rates and a distortion of technology utilization. The effects for nursing home care are more drastic. We estimate a persistent 13% increase in nursing home mortality among the elderly aged 85 and older. Our results also highlight an unintended negative consequence of parental leave programs borne by providers and patients.
    JEL: D22 H75 I10 I11 J13
    Date: 2017–02
  3. By: Brigham Frandsen; Michael Powell; James B. Rebitzer
    Abstract: We propose a "common-agency" model for explaining inefficient contracting in the U.S. healthcare system. In our setting, common-agency problems arise when multiple payers seek to motivate a shared provider to invest in improved care coordination. Our approach differs from other common-agency models in that we analyze "sticking points," that is, equilibria in which payers coordinate around Pareto-dominated contracts that do not offer providers incentives to implement efficient investments. These sticking points offer a straightforward explanation for three long observed but hard to explain features of the U.S. healthcare system: the ubiquity of fee-for-service contracting arrangements outside of Medicare; problematic care coordination; and the historic reliance on small, single specialty practices rather than larger multi-specialty group practices to deliver care. The common-agency model also provides insights on the effects of policies, such as Accountable Care Organizations, that aim to promote more efficient forms of contracting between payers and providers.
    JEL: D8 I10 I18
    Date: 2017–02
  4. By: Marilys Victoire RAZAKAMANANA; Martine AUDIBERT (Centre d'Etudes et de Recherches sur le Développement International(CERDI)); Tantely ANDRIANANTOANDRO; Aina HARIMANANA
    Abstract: In Madagascar, in February 2014, the Ministry of Health and UNICEF implemented a program integrating the diagnosis and treatment of pneumonia into malaria community case management. The objectives of this program were to improve the management of cases of malaria and pneumonia by community health workers to alleviate the problem of accessibility to care and to reduce the number of severe cases treated at health facilities. This paper aims to assess the effectiveness and the efficiency of this. Two districts were taken into account: Andapa received only basic activities ensuring the functionality of the community sites (control district) and Antalaha where all activities related to the program were implemented (treated district). To assess the impact of the program, we use the difference in difference methodology and we compare the period before the implementation of the program in January 2014 and the period when the program is implemented in February 2016. Then cost-effectiveness analysis was made. In Antalaha, although the program has no significant impact on pneumonia, the situation is better than that of Andapa, as in the case of malaria management, the difference is significant between the two districts. The cost-effectiveness analysis also demonstrated that the cost per case of additional malaria and pneumonia treated by CHWs is 2.52 USD (2.44-3.50). However, skills of CHWs should be strengthened especially concerning pneumonia cases management.
    Keywords: Madagascar, Malaria, Pneumonia, Community health workers, Difference in difference methodology, Cost-effectiveness.
    JEL: I18 I12 I15
    Date: 2017–02
  5. By: Timothy Halliday (UH-Manoa Department of Economics, University of Hawaii Economic Research Organization, and IZA); John Lynham (UH-Manoa Department of Economics and University of Hawaii Economic Research Organization); Ã ureo de Paula (UCL, São Paulo School of Economics, IFS, CeMMAP)
    Abstract: The negative consequences of long-term exposure to particulate pollution are well established but many studies find no effect of short-term exposure on health outcomes. The high correlation of industrial pollutant emissions complicates the estimation of the impact of individual pollutants on health. In this study, we use emissions from Kilauea volcano, which are uncorrelated with other pollution sources, to estimate the impact of pollutants on local emergency room (ER) admissions and a precise measure of costs. A one standard deviation increase in particulates leads to a 23-36% increase in expenditures on ER visits for pulmonary outcomes, mostly among the very young. Even in an area where air quality is well within the safety guidelines of the U.S. Environmental Protection Agency, this estimate is much larger than those in the existing literature on the short-term effects of particulates. No strong effects for cardiovascular outcomes are found.
    Keywords: Pollution, Health, Volcano, Particulates, SO2
    JEL: H51 I12 Q51 Q53
    Date: 2015–04
  6. By: MAZEIKAITE Gintare; O?DONOGHUE Cathal; SOLOGON Denisa
    Abstract: Despite high living standards and a nearly universal healthcare provision, large cross-country differences in population health exist in the European Union. More than half of this variation remains unexplained after accounting for macro-level factors. In our paper, we aim to understand how individual-level differences in demographic characteristics, education, labour market factors and income shape the prevalence of poor self-assessed health in the EU. For this purpose, we use a semi-parametric decomposition approach, which relies on constructing synthetic distributions of health that would prevail in each country if they had the distribution of the analysed factors as in the country with the best self-assessed population health ? Ireland. We find regional variation in the decomposition results. The analysed factors explain up to a third of the health inequality in the EU for Southern and Central and Eastern European (CEE) countries, but they fail to explain the health differences for the Western European countries. We suggest that cross-country variation in the reporting of self-assessed health may be partially responsible for this result. Finally, we find that the detailed decomposition results for some of the explanatory factors are sensitive to the decomposition sequence, which shows that interaction effects merit further investigation.
    Keywords: health inequality; decomposition; EU-SILC; socio-economic factors; cross-country
    JEL: J00 N34
    Date: 2017–02
  7. By: Nicholas W. Papageorge (John Hopkins University); Gwyn C. Pauley (University of Southern California); Mardge Cohen (Rush University); Tracey E. Wilson (State University of New York); Barton H. Hamilton (Washington University in St. Louis); Robert A. Pollak (Washington University in St. Louis)
    Abstract: We study the impact of health shocks on domestic violence and illicit drug use. We argue that health is a form of human capital that shifts incentives for risky behaviors, such as drug use, and also changes options outside of violent relationships. To estimate causal effects, we examine chronically ill women before and after a medical breakthrough and exploit differences in these women’s health prior to the breakthrough. We show evidence that health improvements induced by the breakthrough reduced domestic violence and illicit drug use. Our findings provide support for the idea that health improvements can have far-reaching implications for costly social problems. The policy relevance of our findings is compounded by the fact that both domestic violence and illicit drug use are social problems often seen as frustratingly impervious to interventions. One possible reason is that the common factors that drive them, such underlying health or labor market human capital, are themselves very persistent over time. Our study provides a unique test of this hypothesis by examining what happens when factors underlying violence or drug use exogenously shift due to a medical technological advancement. Our findings suggest that both violence and drug use could be reduced by improving women’s access to better healthcare.
    Keywords: domestic violence, intimate partner violence, Health, human capital, chronic illness, medical innovation
    JEL: I10 J12 J24 O39
    Date: 2017–02
  8. By: Joseph J. Doyle, Jr.; John A. Graves; Jonathan Gruber
    Abstract: In response to unsustainable growth in health care spending, there is enormous interest in reforming the payment system to “pay for quality instead of quantity.” While quality measures are crucial to such reforms, they face major criticisms largely over the potential failure of risk adjustment to overcome endogeneity concerns. In this paper we implement a methodology for estimating the causal relationship between hospital quality measures and patient outcomes. To compare similar patients across hospitals in the same market, we xploit ambulance company preferences as an instrument for patient assignment. We find that a variety of measures used by insurers to measure provider quality are successful: assignment to a higher-scoring hospital results in better patient outcomes. We estimate that a two-standard deviation improvement in a composite quality measure based on existing data collected by CMS is causally associated with reductions in readmissions and mortality of roughly 15%.
    JEL: I10
    Date: 2017–02
  9. By: Didem Bernard; Thomas Selden; Yuriy Pylypchuk
    Abstract: U.S. health care spending in 2012 totaled $2.8 trillion or 17.2 percent of gross domestic product. Given the magnitude of health care spending, the large public sector role in health care, and the reforms being implemented under the Patient Protection and Affordable Care Act (ACA), we believe it useful to examine several basic questions: What was the public share of national spending on the eve of reform? How has the public share evolved over time? And how are the benefits of public spending on health care distributed within the population by age, poverty level, insurance coverage, health status, and ACA-relevant subgroups? The questions we pose, while basic, cannot be answered with commonly-available statistics due to the sheer complexity of health care financing in the U.S. The objective of this paper is to provide answers by combining aggregate measures from the National Health Expenditure Accounts with micro-data from the Medical Expenditure Panel Survey.
    JEL: I1 I18
    Date: 2017–02
  10. By: Lehmijoki, Ulla (University of Helsinki); Palokangas, Tapio K. (University of Helsinki)
    Abstract: This article examines pollution and environmental mortality in an economy where fertility is endogenous and output is produced from labor and capital by two sectors, dirty and clean. An emission tax curbs dirty production, which decreases pollution-induced mortality but also shifts resources to the clean sector. If the dirty sector is more capital intensive, then this shift increases labor demand and wages. This, in turn, raises the opportunity cost of rearing a child, thereby decreasing fertility and the population size. Correspondingly, if the clean sector is more capital intensive, then the emission tax decreases the wage and increases fertility. Although the proportion of the dirty sector in production falls, the expansion of population boosts total pollution, aggravating mortality.
    Keywords: environmental mortality, pollution tax, population growth, two-sector models
    JEL: J13 Q56 Q58 O41
    Date: 2016–12
  11. By: Garth Kendall (Curtin University); Ha Trong Nguyen (Bankwest Curtin Economic Centre, Curtin University); Rachel Ong (Bankwest Curtin Economic Centre, Curtin University)
    Abstract: It is very likely that differential access to income and accumulated wealth are both mechanisms that promote growing inequalities between individuals and families in Australia. If this proposition is true, it is important to know the extent to which this differential access impact on the health and wellbeing of the Australian population. While closely related, it is clear that income and wealth are by no means perfectly correlated. It is plausible that inequalities in wealth are increasing at an even greater rate than inequalities in income and that inequalities in wealth pose the greatest risk to social division and future economic development. Economic strain which is associated with economic insecurity, is a significant life stress that is a cause of many poor health outcomes. Furthermore, it is disturbing that despite the economic progress Australia has enjoyed in recent decades, many indicators of health and wellbeing outcomes are exhibiting adverse trends e.g. higher rates of overweight and obesity, type 2 diabetes, depression, and substance abuse. McEwen and Gianaros (2010)review extensive literature that shows that economic strain can lead to poor health and wellbeing across the life course. It is thus critical to uncover whether, and the extent to which, access to income and wealth in fact alleviate economic related stress and promote health and wellbeing.
    Keywords: income, wealth, health, wellbeing
    JEL: D31 I14
    Date: 2017–01
  12. By: Myles Maxfield; Deborah Peikes; Rachel Shapiro; Hongmai Pham; Ann O'Malley; Sarah Scholle; Phyllis Torda
    Abstract: This report presents the design of the Centers for Medicare & Medicaid Services’ (CMS) Medical Home Demonstration.
    Keywords: Medicare , Medical Home Demonstration
    JEL: I
  13. By: Heinrich Hock; Dara Lee Luca; Tim Kautz; David Stapleton
    Abstract: Analysis of National Job Corps Study data shows larger earning impacts for youth with medical limitations compared to others, and a reduced reliance on disability benefits. The Job Corps program warrants greater attention as an option for improving the adult outcomes of youth with disabilities.
    Keywords: Youth with disabilities, job training, employment services, transition to work, Job Corps
    JEL: I J
  14. By: Ha Trong Nguyen (Bankwest Curtin Economics Centre, Curtin University); Luke B Connelly (The University of Queensland)
    Abstract: This study contributes to a small literature on the dynamics of informal care by examining the informal care provision choices of working age Australians. We focus on the impact of previous work characteristics (including work security and flexibility) on subsequent care provision decisions and distinguish between care that is provided to people who cohabit and people who reside elsewhere, as well as between the provision of care as the primary caregiver, or in a secondary caring role. Our dynamic framework of informal care provision accounts for state-dependence, unobserved heterogeneity and initial conditions. For both males and females, we find the existence of positive state-dependence in all care states in both the short- and medium-term. Furthermore, the inertia in care provision appears to be stronger for more intensive care. We also find previous employment status has a significant deterrent effect on current care provision decisions. The effects on employment, however, differ according to the type of previous work, the type of care currently provided, and the gender of the caregiver. We also find that workers with perceptions of greater job security are nevertheless less likely to provide subsequent care. Our results also suggest that workers’ perceptions about work flexibility and their stated overall satisfaction with work actually have no impact on their subsequent decisions to provide care in any capacity.
    Keywords: informal care, labour supply, dynamic multinomial choice models, panel data.
    JEL: C21 J14
    Date: 2016–12
  15. By: Gert G. Wagner; Martin Bruemmer; Axel Glemser; Julia Rohrer; Jürgen Schupp
    Abstract: In diesem Beitrag wird gezeigt, dass es heutzutage gut möglich ist, die Wichtigkeitgesellschaftlicher Ziele und dem Stand der Lebensqualität in der Bevölkerung mit Hilfe einesrepräsentativen Surveys (hier: dem Sozio-oekonomischen Panel, SOEP) mit offenen Fragenund Klartextantworten zu erheben und sinnvoll auszuwerten. Dabei zeigt sich, dasslangfristig wichtige, aber zugleich aktuell wenig spürbare Themen wie Klimawandel,Staatsverschuldung oder die Europäische Unionkaum genannt werden. Wir ziehen dieSchlussfolgerung, dass langfristig wirkende Entwicklungen und Gefahren auch weiterhinvorwiegend dem Diskurs der Fachleute und der politisch denkenden „Avantgarde“zugewiesen werden sollten. Undam Ende müssen in einer repräsentativen Demokratie dieParlamente entscheiden. Auf Basis von modernen repräsentativen Erhebungen undBürgerdialogen können Parlamente vermutlich etwas besser entscheiden als ohne dieseInstrumente der Bürgerbeteiligung. Aber auch eine noch so effektive Bürgerbeteiligung kannParlamente nicht ersetzen. This paper demonstrates how quality of life can be measured by plain text in a representative survey, the German Socio Economic Panel study (SOEP). Furthermore, the paper shows that problems that are difficult to monitor, especially problems like the state of the European Union, long-term climate change but also the national debt or problems with the quality of consumer goods (like food) and services (like medical treatment), are not issues of particular importance to the majority of people. Developments and risks that are difficult to monitor and only have long-term effects should be left primarily to the discourse conducted by experts and the politically-minded “elites”, the avant garde. And in representative democracies it is ultimately the parliamentarians who must decide. Parliamentarians are likely able to make somewhat better decisions using modern representative surveys and national dialogues than they would be without these instruments of civic participation. Nevertheless, improved civic participation cannot replace parliaments.
    Keywords: quality of life, dimensions, open-ended questions, automated text analysis, German Socio Economic Panel study, SOEP
    JEL: B41 C81 C83 C88 D69 I31 Z13
    Date: 2017
  16. By: Tiziana Leone; Ernestina Coast; Divya Parmar; Bellington Vwalika
    Abstract: Zambia has one of the most liberal abortion laws in sub-Saharan Africa. However, rates of unsafe abortion remain high with negative health and economic consequences. Little is known about the economic burden on women of abortion care-seeking in low income countries. The majority of studies focus on direct costs (e.g.: hospital fees). This paper estimates the individual-level economic burden of safe and unsafe abortion care-seeking in Zambia, incorporating all indirect and direct costs. It uses data collected in 2013 from a tertiary hospital in Lusaka, (n=112) with women who had an abortion. Three treatment routes are identified: i) safe abortion at the hospital ii) unsafe clandestine medical abortion initiated elsewhere with post-abortion care at the hospital and iii) unsafe abortion initiated elsewhere with post-abortion care at the hospital. Based on these three typologies, we use descriptive analysis and linear regression to estimate the costs for women of seeking safe and unsafe abortion and to establish whether the burden of abortion care-seeking costs is equally distributed across the sample. Around 39% of women had an unsafe abortion, incurring substantial economic costs before seeking post-abortion care. Adolescents and poorer women are more likely to use unsafe abortion. Unsafe abortion requiring post-abortion care costs women 27% more than a safe abortion. When accounting for uncertainty this figure increases dramatically. For safe and unsafe abortions, unofficial provider payments represent a major cost to women. This study demonstrates that despite a liberal legislation, Zambia still needs better dissemination of the law to women and providers and resources to ensure abortion service access. The policy implications of this study include: the role of pharmacists and mid-level providers in the provision of medical abortion services; increased access to contraception, especially for adolescents; and, elimination of demands for unofficial provider payments.
    JEL: E6
    Date: 2016
  17. By: Klasing, Mariko Jasmin; Klasing, Mariko J.; Milionis, Petros
    Abstract: We explore the impact of the international epidemiological transition on educational outcomes of males and females over the second half of the 20th century. We provide strong evidence that the large resulting declines in mortality rates from infectious diseases gave rise to differential life expectancy gains across genders, with females benefiting mostly from them due to their greater responsiveness to vaccination. We also document that these gender differences in life expectancy gains are subsequently reflected in similar differential increases in educational outcomes for males and females. Using an instrumental variables strategy that exploits pre-intervention variation in mortality rates across different infectious diseases we confirm the causal nature of these effects and show that the magnitude of the effects account for a large share of the reduction in the education gender gap that emerged over this period.
    JEL: I15 J16 O11
    Date: 2016
  18. By: Böhme, Enrico; Frank, Severin; Kerber, Wolfgang
    Abstract: Patent settlements in the pharmaceutical industry between originator and generic firms have been scrutinized critically by competition authorities for delaying the market entry of generics and being therefore potentially anticompetitive. In this paper we present a model that analyzes the tradeoff between limiting the delaying of generic entry through patent settlements and giving generic firms more incentives for challenging weak patents of the originator firms. We can show that under general assumptions allowing patent settlements with a later market entry of generics than the expected market entry under patent litigation would increase consumer welfare. We introduce a policy parameter for determining the optimal additional period for collusion that would maximize consumer welfare and show that the size of this policy parameter depends on the size of the challenging costs, the intensity of competition, and the duration between the market entries of the first and second generic.
    JEL: L10 L40 O34
    Date: 2016
  19. By: Neumann, Julia Kathleen; Zweifel, Peter; Hofmann, Annette
    Abstract: This paper provides a microeconomic basis for simultaneously explaining two phenomena related to health insurance: camouflage and ballooning. We use abortions in Switzerland as an illustrative example. First, a significant share of abortions is camouflaged by contrived medical coding, and second, there is evidence of ballooning in that jurisdictions with strict enforcement of abortion regulation tend to export the problem to more liberal ones. The analysis differs from the existing literature in that we explicitly model the search effort of an individual seeking a health service, i.e., an abortion or camouflage. Using data provided by a major social health insurer, theoretical predictions are confirmed to a considerable degree. In particular, women who derive a particularly high benefit from an abortion (and even more so, from its camouflage) are less discouraged by strict enforcement than others.
    JEL: I18 J13 K42
    Date: 2016
  20. By: Wohlschlegel, Ansgar; Feess, Eberhard; Mueller, Helge
    Abstract: We use a unique dataset from a German health insurer to study how the effects of the introduction of a high powered incentive scheme for hospitals on cost effectiveness and quality of medical treatment depend on case and hospital characteristics. As hospitals had a transition period of several years to complete the switch from a fee-for-service to a prospective-payment system, we can adopt a difference-in-differences approach. All hospitals had to switch eventually, which limits the potential for selection bias. Furthermore, we can follow a patient even when readmitted to a different hospital. We find that the readmission rate increases for more severe cases, and that the length of stay of older people decreases more under the new system. The average length of stay did not change significantly but the readmission rate increased. However, this latter effect is absent in privately owned or university hospitals.
    JEL: I11 D22 I18
    Date: 2016
  21. By: Molitor, Ramona; Anne , Ardila Brenøe
    Abstract: Research has shown a strong negative correlation between birth order and educational outcomes. We ask whether birth order differences in health are present at birth using matched administrative data for more than 1,000,000 children born in Denmark between 1981 and 2010. Using family fixed effects models, we find a positive and robust birth order effect; lower parity children are less healthy at birth. Looking at the potential mechanisms, we find that during earlier pregnancies women have higher labor market attachment, behave more risky in terms of smoking, receive more prenatal care, and are diagnosed with more medical pregnancy complications. Yet, none of these factors explain the birth order differences at birth. The positive birth order effect at birth stands in stark contrast to a negative birth order effect in educational performance. Once we control for health at birth, the negative birth order effect in educational performance further increases.
    JEL: I10 J12 J13
    Date: 2016
  22. By: Schünemann, Johannes; Strulik, Holger; Trimborn, Timo
    Abstract: Unhealthy persons adapt to their bad state of health and persons in bad health are usually happier than estimated by healthy persons. In this paper we investigate how adaptation to a deteriorating state of health affects health spending, life expectancy, and the value of life. We set up a life cycle model in which individuals are subject to physiological aging, calibrate it with data from gerontology, and compare behavior and outcomes of adapting and non-adapting individuals. While adaptation generally increases the life-time utility (by about 2 percent), its impact on health behavior and longevity depends crucially on whether individuals are aware of their adaptive behavior, i.e. whether they adapt in a naive or sophisticated way. We also compute the QALY change implied by health shocks and discuss whether and how adaptation influences results and the desireability of positive health innovations.
    JEL: I12 D91 J17
    Date: 2016
  23. By: Luca Lorenzoni; Jonathan Millar; Franco Sassi; Douglas Sutherland
    Abstract: Health care expenditure per person, after accounting for changes in overall price levels, began to slow in many OECD countries in the early-to-mid 2000s, well before the economic and fiscal crisis. Using available estimates from the OECD’s System of Health Accounts (SHA) database, we explore common trends in health care expenditure since 1996 in a set of 22 OECD countries. We assess the extent to which the trends observed are the results of cyclical economic influences, and the respective contributions of changes in relative prices, health care volumes and coverage to the slowdown in health care expenditure growth. Our analysis suggests that cyclical factors may account for a little less than one half of the estimated slowdown in health care spending since the crisis, suggesting that structural changes have contributed to the trends. Before the crisis the slowdown in health care expenditure growth was accounted for by health care prices growing less than general prices and a reduction in care volumes, whereas the latter accounts for most of the steeper deceleration after the crisis. Although both privately and publically financed health care expenditure grew at a reduced pace during the study period, the sharp post-crisis deceleration happened mostly in the public component. When examined by function, the slowdown in publicly-financed expenditure has been largest in curative and rehabilitative care (particularly after the crisis) and in medical goods (especially pharmaceuticals), whereas the deceleration in the privately financed component is largely in medical goods (including pharmaceuticals). We conclude that structural changes in publicly financed health care have constrained the growth of care volumes (especially) and prices leading to a marked reduction in health care expenditure growth rates, beyond what could be expected based on cyclical economic fluctuations. We examine a range of government policies enacted in a selection of OECD countries that likely contributed to the structural changes observed in our analysis.
    JEL: C23 H51 I18
    Date: 2017–02–24
  24. By: Deniz Karaoğlan (Department of Economics, Bahçeşehir University); Aysıt Tansel (Department of Economics, METU; Institute for the Study of Labor (IZA) Bonn, Germany; Economic Research Forum (ERF) Cairo, Egypt)
    Abstract: This study investigates the factors that may influence the obesity in Turkey which is a developing country by implementing Quantile Regression (QR) methodology. The control factors that we consider are education, labor market outcomes, household income, age, gender, region and marital status. The analysis is conducted by using the 2008, 2010 and 2012 waves of the Turkish Health Survey (THS) prepared by the Turkish Statistical Institute (TURKSTAT). The obesity indicator in our study is the individual’s Body Mass Index (BMI). QR regression results provide robust evidence that additional years of schooling has negative effect on individual’s BMI and this effect significantly raises across different quantiles of BMI. QR results also indicate that males tend to have higher BMI at lower quantiles of BMI, whereas females have higher BMI at the top quantiles. This implies that females have higher tendency to be obese in Turkey. Our findings also imply that the positive effect of age on individual’s BMI levels raises across the quantiles at a decreasing rate. In addition, the effect of living in urban or rural areas do not significantly differ at the highest quantile distributions of BMI. Our results also reveal that the negative effect of being single on BMI increases gradually in absolute value across the quantiles of BMI implying that single individuals have less tendency to be obese or overweight compared to the married or widowed/divorced individuals. Moreover, the negative effect of being in labor force on individual’s BMI increases across the quantiles of BMI implying that an individual is more likely to be obese if he/she is out of labor force. Finally, the impact of household income on BMI is positive and significant at all quantiles.
    Keywords: Obesity, adults, BMI, quantile regression, Turkey
    JEL: I12 I18 C21
    Date: 2017–01
  25. By: Laurène PETITFOUR (FERDI); Xiezhe HUANGFU (FERDI); Martine AUDIBERT (FERDI); Jacky MATHONNAT (Cerdi - University of Auvergne)
    Abstract: Since the early 2000s, China has embarked on a major reform program in the field of health. Three are essential and linked: rebuilding a new health insurance system in rural areas, restructuring the organization and management of hospitals, halting the sharp rise in drug prices. To cope with the rising price of drugs, in 2009 the Chinese government launched a large pharmaceutical reform. Its key element is the implementation of a National Essential Medicine List (NEML), leading to a reorientation of incentives for health services financing. Health facilities are no longer allowed to make any profit on drug sales (“zero mark-up policy”), while this used to be their main source of revenue. Authorities have implemented different compensation schemes. In the context of redesigning the financing structure of health care facilities, it is crucial to understand how the NEML reform has affected—or not—the activity and efficiency of health care facilities, since the search for greater efficiency in the health system is a transversal and underlying objective of the three reforms mentioned above.This study relies on survey data from a sample of 30 randomly selected Township Hospitals (TH) in rural area from the prefecture of Weifang, in the Shandong province. Using a two-stage procedure, the study aims at assessing the technical efficiency scores of Township Hospitals and then at identifying the determinants of this efficiency. The first stage is realized with a non-parametric frontier approach, “partial frontier” method (order-m), to deal with the problem of dimensionality of the sample. The identification of the determinants of efficiency is made with fractional regressions (Ramalho, 2011). Results show that the average efficiency remains constant from 2006 to 2009 and 2010 to 2012, at around 0.65. The most significant and robust factors of technical efficiency are the share of subsidies in the TH incomes (negative effect) and the number of covered inhabitants per bed (positive effect). The study suggests that even after the implementation of the drug reform, a “soft budget constraint” effect remains, as well as financial barriers to universal access to healthcare (importance of demand-side determinants) and a phenomenon of oversizing of some THs.
    Date: 2017–02
  26. By: French, Eric; Jones, John Bailey (Federal Reserve Bank of Richmond)
    Abstract: The degree to which retirement decisions are driven by health is a key concern for both academics and policymakers. In this paper we survey the economic literature on the health-retirement link in developed countries. We describe the mechanisms through which health affects labor supply and discuss how they interact with public pensions and public health insurance. The historical evidence suggests that health is not the primary source of variation in retirement across countries and over time. Furthermore, declining health with age can only explain a small share of the decline in employment near retirement age. Health considerations nonetheless play an important role, especially in explaining cross-sectional variation in employment and other outcomes within countries. We review the mechanisms through which health affects retirement and discuss recent empirical analyses.
    Keywords: disability; elderly; health; retirement; Social Security
    Date: 2017–02–17
  27. By: Antoine MARSAUDON (Université Paris I Panthéon-Sorbonne); Josselin THUILLIEZ (CNRS-Sorbonne)
    Abstract: Does democracy help Kenyan citizens to struggle against the HIV epidemic? Yet, very little attention has been devoted to establish whether political regimes react differently to the HIV infection. Using an electoral definition of democracy makes a contribution in understanding which aspects of political rules matter to manage the disease. Using a difference-in-difference design that draws upon pre-existing variations in HIV intensity and cohort’s exposure to democracy, we find that a person living under democracy is less likely to have a HIV infection. Further, we present some evidence of ethnic favoritism and gender disparities during periods of non-democracy.
    Keywords: institution, democracy, HIV, Health, Kenya
    JEL: I15 I18 O15 O38 P51
    Date: 2016–10
  28. By: James D. Reschovsky; Cynthia B. Saiontz-Martinez
    Abstract: Higher levels of the malpractice fear index were associated with higher patient spending.
    Keywords: Malpractice claim, Medicare
    JEL: I
  29. By: David Slusky; Donna Ginther
    Abstract: Prior to the Affordable Care Act, many state Medicaid eligibility rules had maximum asset levels. This was a problem when one member of a couple was diagnosed with a degenerative disease requiring expensive care. Draining the couple’s assets so that the sick individual could qualify for Medicaid would leave no resources for the retirement of the other member; thus divorce and separating assets was often the only option. The ACA’s Medicaid expansion removed all asset tests. Using a difference-in-differences approach on states that did and did not expand Medicaid, we find that the expansion decreased the prevalence of divorce by 5.6% among those 50-64, strongly suggesting that it reduced medical divorce.
    JEL: I13 J12
    Date: 2017–02
  30. By: Thomas C. Buchmueller; Colleen Carey
    Abstract: The misuse of prescription opioids has become a serious epidemic in the US. In response, states have implemented Prescription Drug Monitoring Programs (PDMPs), which record a patient's opioid prescribing history. While few providers participated in early systems, states have recently begun to require providers to access the PDMP under certain circumstances. We find that "must access" PDMPs significantly reduce measures of misuse in Medicare Part D. In contrast, we find that PDMPs without such provisions have no effect. We find stronger effects when providers are required to access the PDMP under broad circumstances, not only when they are suspicious.
    JEL: I12 I18
    Date: 2017–02
  31. By: Ha Trong Nguyen (Bankwest Curtin Economic Centre, Curtin University); Luke B Connelly (The University of Queensland)
    Keywords: Health insurance, Difference-in-difference, Cost-sharing, Developing country, Vietnam.
    JEL: G22 I11 I18
    Date: 2017–02

This nep-hea issue is ©2017 by Yong Yin. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.