nep-hea New Economics Papers
on Health Economics
Issue of 2017‒04‒30
nineteen papers chosen by
Yong Yin
SUNY at Buffalo

  1. Health-Related Income Gaps and the Effectiveness of Redistributive Policies in Japan By ZHAO Meng (KONISHI Moe)
  2. Population Aging, Health Care, and Fiscal Policy Reform: The challenges for Japan By HSU Minchung; YAMADA Tomoaki
  3. Trends in gender differences in health and mortality at working ages among West and East Germans By Mine Kühn; Christian Dudel; Tobias C. Vogt; Anna Oksuzyan
  4. The Drive toward Universal Health Coverage: Progress and Challenges around the World By Young Eun Kim; Norman V. Loayza
  5. Enrollee Choices after Their Health Plans Are Terminated: Default Effects versus Persistent Preferences By Sinaiko, Anna; Zeckhauser, Richard
  6. Dynamic Assignment of Patients to Primary and Secondary Inpatient Units: Is Patience a Virtue? By Kilinc, Derya; Saghafian, Soroush; Traub, Stephen
  7. Price-Linked Subsidies and Health Insurance Markups By Jaffe, Sonia; Shepard, Mark
  8. The Evolution of Health Insurer Costs in Massachusetts, 2010-12 By Ho, Kate; Pakes, Ariel; Shepard, Mark
  9. Smoking Ban and Health at Birth By Tamas Hajdu; Gabor Hajdu
  10. Health and Health Inequality during the Great Recession: Evidence from the PSID By Chenggang Wang; Huixia Wang; Timothy J. Halliday
  11. Historical Prevalence of Infectious Diseases, Cultural Values, and the Origins of Economic Institutions By Nikolaev, Boris; Salahodjaev, Raufhon
  12. The Multiple Effects of Child Health Insurance in Vietnam By Dang, Thang
  13. The Poverty-Economic Growth-Health Triangle By cyrine hannafi; Christophe Muller
  14. Reforms and physicians’ status in Turkey: Distribution of OOP Health Expenditures for Physicians and Hospitals By Burcay Erus
  15. Evaluating the Effects of a Targeted Home Visiting Program on Maternal and Child Health Outcomes By Malte Sandner; Thomas Cornelissen; Tanja Jungmann; Peggy Herrmann
  16. Water Improvement and Health: Historical Evidence on the Effect of Filtering Water on Urban Mortality By Knutsson, Daniel
  17. Early Effects of the Affordable Care Act on Health Care Access, Risky Health Behaviors, and Self-Assessed Health By Charles Courtemanche; James Marton; Benjamin Ukert; Aaron Yelowitz; Daniela Zapata
  18. Adaptation and the Mortality Effects of Temperature Across U.S. Climate Regions By Garth Heutel; Nolan H. Miller; David Molitor
  19. Nonparametric kernel estimation of the impact of tax policy on the demand for private health insurance in Australia By Xiaodong Gong; Jiti Gao

  1. By: ZHAO Meng (KONISHI Moe)
    Abstract: Previous studies have well documented that individuals with poorer health tend to be economically disadvantaged. This study focuses on the income difference between individuals with reported poor health and their healthier counterparts, which is referred to as a health-related income gap. Using rich data from the Comprehensive Survey of Living Conditions collected from 1989 to 2010 in Japan, we adopt the newly developed unconditional quantile regression (UQR) approach (Firpo et al., Econometrica , 2009) to analyze the income gap at different points along the income distribution. Furthermore, we investigate various types of income for the working-age population aged 25-59: household and personal income, pre- and post-tax income, as well as income after different types of taxes. The results suggest the following major findings: (a) The gap varies significantly along the distribution of income and by income type. When household per capita income increases, the gap due to ill health shrinks. For personal income, however, a U-shape trend is observed, and the gap first decreases and then increases. (b) Compared to health-related gaps in pre-tax income, the gap is greater after income taxes for the lower-middle and middle income earner, and social security contributions tend to widen the gap for those in the lower end of the tail.
    Date: 2017–03
  2. By: HSU Minchung; YAMADA Tomoaki
    Abstract: This paper quantitatively studies the influence of a rapidly aging population on the financing of a public universal health insurance system and the corresponding fiscal policies. We construct a general equilibrium life-cycle model to investigate the effects of aging and evaluate various policy alternatives designed to lessen the negative influence of aging. In particular, we analyze the reforms of insurance benefits and tax financing tools that were the recent focus of a great amount of attention and debate in Japan because of the tense financial situation. We show that although the potential reforms significantly improve the welfare of future generations, political implementation of such reforms is difficult because of the large welfare costs for the current population. Our analysis suggests that a gradual reform with an intergenerational redistribution will be more implementable politically than a sudden reform.
    Date: 2017–03
  3. By: Mine Kühn (Max Planck Institute for Demographic Research, Rostock, Germany); Christian Dudel (Max Planck Institute for Demographic Research, Rostock, Germany); Tobias C. Vogt (Max Planck Institute for Demographic Research, Rostock, Germany); Anna Oksuzyan (Max Planck Institute for Demographic Research, Rostock, Germany)
    Abstract: -
    Keywords: Germany, gender, health, satisfaction, sex differentials
    JEL: J1 Z0
    Date: 2017–04
  4. By: Young Eun Kim (World Bank); Norman V. Loayza (World Bank)
    Abstract: To move toward universal health coverage to enable everyone to receive quality health care without financial hardship, three dimensions should be considered simultaneously: population to be covered, health services to be covered, and financial risk protection. Collaboration among ministries of health, finance, education, and labor is important for effective policy making and implementation, and societal solidarity is essential for sustainability.
    Date: 2017–04
  5. By: Sinaiko, Anna (Harvard University); Zeckhauser, Richard (Harvard University)
    Abstract: Behavioral economic research has established that defaults, one form of nudge, powerfully influence choices. In most policy contexts, all individuals receive the same nudge. We present a model that analyzes the optimal universal nudge when individuals differ in their preferences, different individuals should make different choices, and there is a cost to resist a nudge. Our empirical focus is on terminated choosers, individuals whose prior choice becomes no longer available. Specifically, we examine the power of defaults for individuals who had enrolled in Medicare Advantage with drug coverage and had their plans discountinued. Should these terminated choosers fail to actively choose another Medicare Advantage plan, they are automatically defaulted into fee-for-service Medicare absent drug coverage. Overall, the rate of transition for TCs to FFS Medicare is low, implying that original preferences and status quo bias overpowered the default. Black TCs were more susceptible to the default than non-blacks. Increasing numbers of Americans are choosing plans in health insurance exchange settings such as Medicare, the Affordable Care Act (ACA), and private exchanges. Plan exits and large numbers of TCs are inevitable, along with other forms of turmoil. Any guidance and defaults provided for TCs should attend to their past revealed preferences.
    Date: 2016–12
  6. By: Kilinc, Derya (AZ State University); Saghafian, Soroush (Harvard University); Traub, Stephen (Mayo Clinic College of Medicine)
    Abstract: An important contributor to the well-known problem of Emergency Department (ED) overcrowding is prolonged boarding of patients who are admitted through the ED. Patients admitted through the ED constitute about 50% of all non-obstetrical hospital admissions, and may be boarded in the ED for long hours with the hope of finding an available bed in their primary inpatient unit. We study effective ways of reducing ED boarding times by considering the trade-off between keeping patients in the ED and assigning them to a secondary inpatient unit. The former can increase the risk of adverse events and cause congestion in the ED, whereas the latter may adversely impact the quality of care. Further complicating this calculus is the fact that a secondary inpatient unit for a current patient can be the primary unit for a future arriving patient; assignments, therefore, should be made in an orchestrated way. Developing a queueing-based Markov decision process, we first demonstrate that patience in transferring patients is a virtue, but only up to a point. We also find that, contrary to the prevalent perception, idling inpatient beds can be beneficial. Since the optimal policy for dynamically assigning patients to their primary and secondary inpatient units is complex and hard to implement in hospitals, we develop a simple policy which we term penalty-adjusted Largest Expected Workload Cost (LEWC-p). Using simulation analyses calibrated with hospital data, we find that implementing this policy could significantly help hospitals to improve their patient safety by reducing boarding times while controlling the overflow of patients to secondary units. Using both data analyses and various simulation experiments, we also help managers by generating insights into hospital conditions under which achievable improvements are significant.
    Date: 2016–12
  7. By: Jaffe, Sonia (University of Chicago); Shepard, Mark (Harvard University)
    Abstract: Subsidies in many health insurance programs depend on prices set by competing insurers ? as prices rise, so do subsidies. We study the economics of these "price-linked" subsidies compared to "fixed" subsidies set independently of market prices. We show that price-linked subsidies weaken price competition, leading to higher markups and subsidy costs for the government. We argue that price-linked subsidies make sense only if (1) there is uncertainty about costs/prices, and (2) optimal subsidies increase as prices rise. We propose two reasons why optimal health insurance subsidies may rise with prices: doing so both insures consumers against cost risk and indirectly links subsidies to market-wide shocks affecting the cost of "charity care" used by the uninsured. We evaluate these tradeoffs empirically using a structural model estimated with data from Massachusetts' health insurance exchange. Relative to fixed subsidies, price-linking increase prices by up to 5%, and by 5-10% when we simulate markets with fewer insurers. For levels of cost uncertainty that are reasonable in a mature market, we find that the losses from higher prices outweigh the benefits of price-linking.
    Date: 2017–01
  8. By: Ho, Kate (Columbia University); Pakes, Ariel (Harvard University); Shepard, Mark (Harvard University)
    Abstract: We analyze the evolution of health insurer costs in Massachusetts between 2010-2012, paying particular attention to changes in the composition of enrollees. This was a period in which Health Maintenance Organizations (HMOs) increasingly used physician cost control incentives but Preferred Provider Organizations (PPOs) did not. We show that cost growth and its components cannot be understood without accounting for (i) consumers' switching between plans, and (ii) differences in cost characteristics between new entrants and those leaving the market. New entrants are markedly less costly than those leaving (and their costs fall after their entering year), so cost growth of continuous enrollees in a plan is significantly higher than average per-member cost growth. Relatively high-cost HMO members switch to PPOs while low-cost PPO members switch to HMOs, so the impact of cost control incentives on HMO costs is likely different from their impact on market-wide insurer costs.
    JEL: I11 I13 L10
    Date: 2017–01
  9. By: Tamas Hajdu (Institute of Economics, Research Centre for Economic and Regional Studies, Hungarian Academy of Sciences); Gabor Hajdu (Institute for Sociology, Centre for Social Sciences, Hungarian Academy of Sciences and MTA-ELTE Peripato Comparative Social Dynamics Research Group, Hungary)
    Abstract: In 2012, smoking restrictions were extended to hospitality venues in Hungary. Women working in bars and restaurants were primarily affected by the intervention. In this research, we analyze the effect of this smoking ban on the outcomes of their intended pregnancies. Using complete individual live birth, fetal loss (miscarriage, stillbirth), and infant mortality registry data, we examine the probability of live birth, indicators of health at birth, and the probability of death in the first year of life. We perform a difference-in-differences estimation and show that the smoking ban has improved health at birth of the newborns of mothers working in bars and restaurants and has reduced infant mortality among them. Performing a series of robustness tests, we provide evidence that strongly supports the causal interpretation of our results. We also show that the ban was more beneficial for newborns of parents with low educational attainment and with lower fetal health endowments.
    Keywords: smoking ban, policy evaluation, health at birth
    JEL: I18 J13
    Date: 2017–02
  10. By: Chenggang Wang (University of Hawaii at Manoa, Department of Economics); Huixia Wang (Hunan University, School of Economics and Trade); Timothy J. Halliday (University of Hawaii at Manoa, Department of Economics; University of Hawaii Economic Research Organization)
    Abstract: We estimate the impact of the Great Recession of 2007-2009 on health outcomes in the United States. We show that a one percentage point increase in the unemployment rate resulted in a 7.8-8.8 percent increase in reports of poor health. Mental health was also adversely impacted and reports of chronic drinking increased. The bulk of the effects were borne by white Americans and the less educated.
    Keywords: Great Recession, Health Behaviors, Health Outcomes, Inequality
    Date: 2017–04
  11. By: Nikolaev, Boris; Salahodjaev, Raufhon
    Abstract: It is widely believed that economic institutions such as competitive markets, the banking system, and the structure of property rights are essential for economic development. But why economic institutions vary across countries and what are their deep origins is still a question that is widely debated in the developmental economics literature. In this study, we provide an empirical test for the provocative hypothesis that the prevalence of infectious diseases influenced the formation of personality traits, cultural values, and even morality at the regional level (the so called Parasite- Stress Theory of Values and Sociality), which then shaped economic institutions across countries. Using the prevalence of pathogens as an instrument for cultural traits such as individualism, we show in a two-stage least squares analysis that various economic institutions, measured by different areas of the index of Economic Freedom by the Heritage Foundation, have their deep origins in the historical prevalence of infectious diseases across countries. Our causal identification strategy suggests that cultural values affect economic institutions even after controlling for a number of confounding variables, geographic controls, and for different sub-samples of countries. We further show that the results are robust to four alternative measures of economic and political institutions.
    Keywords: economic institutions, cultural values, pathogens
    JEL: B00 O1 O17
    Date: 2017–02
  12. By: Dang, Thang
    Abstract: This paper estimates multiple effects of tremendous expansion in health insurance coverage for children on medical services utilizations for both children and parents by focusing on Free Care for Children Under Six, a child health insurance program that provides free access to health care practices for children under 6 in Vietnam. Using a regression discontinuity design, the paper finds that child health insurance has considerable positive effects on children’s health care uses whereas it reduces parental health care utilization for some outcomes. In particular, child health health insurance increases the probabilities of public inpatient visit and private outpatient visit by 22.3% and 33% respectively while it rises the frequencies of public inpatient visits and private outpatient visits by 0.32 times and 2.24 times respectively. In contrast, child health insurance reduces a mother’s probabilities of public inpatient visit and public outpatient visit by 32.6% and 27% respectively, number of public inpatient visits by 0.41 times. Also, paternal impacts of child health insurance consists of a 23.2% reduction in the probability of private outpatient visit and a 1.01 time decrease in the frequency of private outpatient visits. The paper significantly provides a more insightful understanding of various impacts of a health policy on health care utilization from developing countries.
    Keywords: Child health insurance; health care utilization; regression discontinuity; Vietnam
    JEL: I12 I13 I18
    Date: 2017–04–19
  13. By: cyrine hannafi; Christophe Muller
    Abstract: To identify the dynamic interactions existing between Poverty, Economic Growth and Health using country-level panel data from developing countries We treat endogeneity and the selectivity issues coming from unavailability of poverty indicators. We develop innovative econometric methods that we apply to an original set of indicators at country level. e find that the data generation through household surveys depends on crucial socio-economic factors and that our new method of selectivity correction has a massive impact on our estimation results casting doubt on previous findings in the literature and changing fundamentally the picture and the interpretation of development process.
    Keywords: Developing cotntries, Modeling: new developments, Macroeconometric modeling
    Date: 2016–07–04
  14. By: Burcay Erus (Bogazici University)
    Abstract: Turkish health care reforms brought about significant changes regarding the way physicians practice. Dual-time practice, which was very common among public hospital physicians, was gradually banned. While public insurance coverage has been extended to private hospitals, private practices have been left out. The resulting system rendered physicians more attached to the hospitals, public and private, and decreased their independence. This study explores the change in out-of-pocket payments to physicians and hospitals from 2003, the year reforms started, to 2013. We use a finite mixture model to examine changes in small and large expenditures. Our findings show a steep drop in payments to physicians both for small and large sums of payments. For hospitals, the drop in the size of the payments appear to be compensated by an increase in the number of households making a payment.
    Date: 2017–04–25
  15. By: Malte Sandner (University College London); Thomas Cornelissen (University of York); Tanja Jungmann (Universität Rostock); Peggy Herrmann (Hannover Medical School)
    Abstract: We evaluate the effects of home visiting targeted towards disadvantaged first-time mothers on maternal and child health outcomes. Our analysis exploits a randomized controlled trial and combines rich longitudinal survey data with unique administrative health data. In a context in which the target group has comprehensive health care access, we find that home visiting has no effects on most types of health utilization, health behaviors, and physical health measures. However, the intervention has a remarkably robust and sizable positive effect on maternal mental health, reducing depressions reported in the survey data and prescriptions of psycholeptics recorded in the administrative data.
    Keywords: child health, disadvantaged families, mental health, early childhood intervention
    JEL: I14
    Date: 2017–04
  16. By: Knutsson, Daniel (Dept. of Economics, Stockholm University)
    Abstract: In this paper, I analyse how technologies for cleaning and distributing water can affect health using new historical data from Sweden. The city of Stockholm introduced a slow filter water cleaning system and piped distribu- tion network in 1861 enabling parts of the population in-house access. The historical context allows me to analyse these technologies without sewerage access as no major sewerage system was constructed at the same time. By using detailed information on water access through contemporary contract lists I can measure access to clean water with great precision. My findings suggest large beneficial effects of having access to clean in-house water. This effect is apparent for the general population but not as precise for infants and in line or even larger than previous estimates. I document heterogeneity in infant mortality with respect to gender where girls seem to have benefited more.
    Keywords: Water; Piped water; Filtered water; Infant Mortality; Mortality; Public Health
    JEL: I15 I18 J11 N33 Q53
    Date: 2017–04–21
  17. By: Charles Courtemanche; James Marton; Benjamin Ukert; Aaron Yelowitz; Daniela Zapata
    Abstract: The goal of the Affordable Care Act (ACA) was to achieve nearly universal health insurance coverage through a combination of mandates, subsidies, marketplaces, and Medicaid expansions, most of which took effect in 2014. We use data from the Behavioral Risk Factor Surveillance System to examine the impacts of the ACA on health care access, risky health behaviors, and self-assessed health after two years. We estimate difference-in-difference-in-differences models that exploit variation in treatment intensity from state participation in the Medicaid expansion and pre-ACA uninsured rates. Results suggest that the ACA led to sizeable improvements in access to health care in both Medicaid expansion and non-expansion states, with the gains being larger in expansion states along some dimensions. No statistically significant effects on risky behaviors or self-assessed health emerge for the full sample. However, we find some evidence that the ACA improved self-assessed health among older non-elderly adults, particularly in expansion states.
    JEL: I12 I13 I18
    Date: 2017–03
  18. By: Garth Heutel; Nolan H. Miller; David Molitor
    Abstract: We study heterogeneity in the relationship between temperature and mortality across U.S. climate regions and its implications for climate adaptation. Using exogenous variation in temperature and data on all elderly Medicare beneficiaries from 1992 – 2011, we show that the mortality effect of hot days is much larger in cool ZIP codes than in warm ones and that the opposite is true for cold days. We attribute this heterogeneity to historical climate adaptation. As one adaptive mechanism, air conditioning penetration explains nearly all of the regional heterogeneity in heat-driven morality but not cold-driven mortality. Combining these results with projected changes in local temperature distributions by the end of the century, we show that failure to incorporate climate heterogeneity in temperature effects can lead to mortality predictions that are wrong in sign for both cool and warm climates. Allowing regions to adapt to future climate according to the degree of climate adaptation currently observed across climates yields mortality impacts of climate change that are much lower than those estimated without allowing for adaptation, and possibly even negative.
    JEL: I18 J14 Q54
    Date: 2017–03
  19. By: Xiaodong Gong; Jiti Gao
    Abstract: This paper is motivated by our attempt to answer an empirical question: how is private health insurance take-up in Australia affected by the income threshold at which the Medicare Levy Surcharge (MLS) kicks in? We propose a new difference de-convolution kernel estimator for the location and size of regression discontinuities. We also propose a bootstrapping procedure for estimating confidence bands for the estimated discontinuity. Performance of the estimator is evaluated by Monte Carlo simulations before it is applied to estimating the effect of the income threshold of Medicare Levy Surcharge on the take-up of private health insurance in Australia using contaminated data.
    Keywords: De-convolution kernel estimator, regression discontinuity, error-in-variables, demand for private health insurance.
    JEL: C13 C14 C29 I13
    Date: 2017

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