nep-hea New Economics Papers
on Health Economics
Issue of 2017‒06‒18
eighteen papers chosen by
Yong Yin
SUNY at Buffalo

  1. The effect of cigarette taxes during pregnancy on educational outcomes of the next generation By Sonja Settele; Reyn van Ewijk
  2. The Welfare Implications of Health Insurance By Sonia Jaffe; Anup Malani
  3. Health and inequality in health in the Nordic countries By Christiansen, Terkel; Lauridsen, Jørgen; Lyttkens, Carl Hampus; Ólafsdóttir, Thorhildur; Valtonen, Hannu
  4. The Impact of Obesity on Adult Mortality: Assessment of Estimates with Applications By Alberto Palloni; Hiram Beltrán-Sánchez
  5. Changes in income, education and health inequality over the last 20 years: evidence from Latin America, sub-Saharan Africa and South Asia By Giovanni Andrea Cornia
  6. Behavioural response to a sudden health risk: Dengue and educational outcomes in Colombia By Barron, Kai; Gamboa, Luis F.; Rodriguez-Lesmes, Paul
  7. Austerity, health care provision, and health outcomes in Spain By Borra, Cristina; Pons-Pons, Jeronia; Vilar-Rodriguez, Margarita
  8. No free lunch, Buddy: past housing transfers and informal care later in life By Emanuele Ciani; Claudio Deiana
  9. Does Physician Pay Affect Procedure Choice and Patient Health? Evidence from Medicaid C-section Use By Alexander, Diane
  10. Healthy life expectancy, mortality, and the age prevalence of morbidity By Timothy Riffe; Alyson A. van Raalte; Maarten J. Bijlsma
  11. Federal Fiscal Transfers on Health: Implications of Fourteenth Finance Commission Recommendations at Subnational Level By Das, Nimai
  12. Health and Weight By Olaf Hübler
  13. Introducing Risk Adjustment and Free Health Plan Choice in Employer-Based Health Insurance: Evidence from Germany By Adam Pilny; Ansgar Wübker; Nicolas R. Ziebarth
  14. Social capital and maternal health care use in rural Ethiopia By Sheabo Dessalegn, S.
  15. The Causal Effect of Retirement on Health Services Utilization: Evidence from Urban Vietnam By Dang, Thang
  16. Estimating the Recession-Mortality Relationship when Migration Matters By Vellore Arthi; Brian Beach; W. Walker Hanlon
  17. Labor Supply Responses to Chronic Illness in Senegal By Virginie Comblon; Karine Marazyan
  18. Looking at the Centers for Medicare and Medicaid Services Research Designs in a New Context By Thomas W. Grannemann; Randall S. Brown

  1. By: Sonja Settele (Management and Microeconomics Group, Goethe University Frankfurt); Reyn van Ewijk (Chair of Statistics and Econometrics, Gutenberg University Mainz)
    Abstract: Smoking during pregnancy is most common among women with a low socioeconomic status and is negatively associated with important infant health measures such as birth weight. Cigarette taxes decrease smoking amongst pregnant women, thereby leading to improved birth outcomes. In this paper we investigate whether increasing cigarette taxes can reduce the intergenerational transmis-sion of a low socioeconomic status by reducing smoking rates among pregnant women with low edu-cational attainment. In a first step, we exploit variation in cigarette taxes across U.S. states over time to show that increasing cigarette taxes leads to improvements in the health of newborns which are larger for babies of low educated mothers. In a second step, we look at subsequent educational suc-cess of 16-year-olds measured by grade retention and school enrollment in a large sample of adoles-cents. We find that increasing cigarette taxes improves the outcomes of children from a low socioeco-nomic background, but find no effects among children from a higher socioeconomic background. Our findings therefore suggest that cigarette taxes can be an effective policy instrument for mitigating the propagation of a low socioeconomic status from one generation to the next.
    Keywords: Early Life, Tobacco Taxes, Socioeconomic Inequalities.
    JEL: I12 I14 I24
    Date: 2017–03
  2. By: Sonia Jaffe (Becker Friedman Institute For Research in Economics); Anup Malani (University of Chicago)
    Abstract: We analyze the financial value of insurance when individuals have access to credit markets. Loans allow consumers to smooth shocks across time, decreasing the value of the smoothing (across states of the world) provided by insurance. We derive a simple formula for the incremental value of insurance and show how it depends on individual characteristics and the features of available loans. Our central contribution is to derive formulas for aggregate welfare that can be taken to data from typical studies of health insurance. We provide both exact formulas that can be taken to data on the distribution of medical expenditures and income and an approximate formula for aggregate data on medical expenditure. Using the Medical Expenditure Panel Survey we illustrate how the incremental value of insurance is decreasing with access to loans. For consumers in the sickest decile, access to a five-year loan decreases the incremental value of insurance by $338 (6%) on average and $3,433 (36%) for the poorest consumers. We also find that our approximate formula is a reasonable proxy for the exact one in our data.
    Keywords: health insurance, credit access
    JEL: I10 I13 I00 H53
    Date: 2017–06
  3. By: Christiansen, Terkel (Department of Business and Economics, and COHERE); Lauridsen, Jørgen (Department of Business and Economics, and COHERE); Lyttkens, Carl Hampus (Department of Economics); Ólafsdóttir, Thorhildur (Faculty of Business Administration); Valtonen, Hannu (Institute of Public Health and Clinical Nutrition)
    Abstract: All five Nordic countries emphasise equal and easy access to healthcare. It is the purpose to explore to which extent the populations of these countries have reached good health and high degree of socio-economic equality of health. Each of the five countries has established extensive public health programmes, although with somewhat different emphasis on the causes of ill-health, such as individual behaviour or social circumstances. Attitudes have changed over time, though. We compare these countries to the UK and Germany by using data from the European Social Survey 2002 and 2012 in addition to OECD Statistics from the same years. Health is measured by self-assessed health in five categories, transformed to a cardinal scale using Swedish time trade-off weights. As socio-economic variable we use household income or length of education. Mean health, based on Swedish TTO weights applied to all countries, is above 0.93 in all the Nordic countries and the UK in 2012, while lower in Germany. Rates in good or very good health in the lower income half of the samples are above 0.6 in most countries and even higher in Iceland and Sweden, but below 0.5 in Germany. However, when displayed in a graph the concentration curves nearly follow the diagonal implying almost no income- or education related inequality in self-assessed health weighted by TTO based preferences. The difference is a natural consequence of using different methods. We compared four key life-style related determinants of ill health and found that while there were differences in relative levels between the countries, Germany had a relatively high level of three of these, followed by the UK. We found no association between level of resources used and health status. In general, the Nordic countries have accomplished good health for their populations and high degree of socioeconomic equality in health. Improvements in life-style related determinants of health would be possible, though.
    Keywords: International comparison of health systems; health status; health equity
    JEL: I11 I14 I19
    Date: 2017–06–06
  4. By: Alberto Palloni (University of Wisconsin–Madison); Hiram Beltrán-Sánchez
    Abstract: In this paper we assess properties of commonly used estimates of total effects of obesity on mortality and identify consequences of these properties for inferences. We argue that standard estimates have important shortcomings that at best limit the reach of inferences and at worst lead to misleading conclusions. Although some of these limitations are routinely acknowledged, rarely is their use accompanied by careful scrutiny of their weaknesses, let alone by a quantitative assessment of their sensitivity to violations of some stringent assumptions on which they are based. In this paper we develop an integrated framework based on a multistate hazard model to describe properties of the simpler standard estimates, identify conditions under which their performance is best, and define the nature of biases and interpretational ambiguities that emerge when empirical conditions depart more than modestly from optimal ones. In particular, we show formally that estimates from limited panel data and two-state hazard models with obesity as a covariate, the workhorse in this area, produce estimates that are difficult to interpret and compare across studies and, in some cases, biased. Finally, we propose a simple procedure that can be employed when the use of conventional two-state models is risky and illustrate its application to an a empirical case.
    Keywords: obesity, T2D, mortality, multistate hazard model, two-state hazard model
    JEL: I10 C33 D81
    Date: 2017–05
  5. By: Giovanni Andrea Cornia (Dipartimento di Scienze per l'Economia e l'Impresa)
    Abstract: This paper analyses the interactions among income, health and educational inequality, and reviews changes in the distribution of income, health and education during the last three decades in Latin America, sub-Saharan Africa and South Asia. The analysis tries to relate such changes to the development strategies followed by the countries of these regions during this period. Such strategies have exerted a considerable influence on public policy and human development inequality. The paper concludes with a set of policies that would help reduce inequality in these three dimensions based on the interconnections among them.
    Date: 2017
  6. By: Barron, Kai; Gamboa, Luis F.; Rodriguez-Lesmes, Paul
    Abstract: Epidemics tend to have a debilitating influence on the lives of directly afflicted families. However, the presence of an epidemic can also change the behaviour and outcomes of those not directly affected. This paper makes use of a short, sharp, unexpected epidemic to examine the behavioural response of the general public to a sudden shift in the perceived risk to an individual's health and mortality. Our analysis finds that unafflicted school students change their behaviour substantially, affecting important life outcomes. In particular, we find that close to 4 fewer students, out of a typical class of 47 pupils, sit their school leaving examination for every additional 10 cases of severe Dengue per 10 000 inhabitants in a municipality. We rule out several possible mechanisms, leaving an increase in the salience of the disease's risks as a plausible explanation for our findings.
    Keywords: Health,health risks,education,human capital,Dengue,Colombia
    JEL: I12 I15 I20 D80
    Date: 2017
  7. By: Borra, Cristina; Pons-Pons, Jeronia; Vilar-Rodriguez, Margarita
    Abstract: The recession that started in the United States in December 2007 has had a significant impact on the Spanish economy through a large increase in the unemployment rate and a long recession which led to tough austerity measures imposed on public finances. Taking advantage of this quasi-natural experiment, we use data from the Spanish Ministry of Health from 1997 to 2014 to provide novel causal evidence on the short-term impact of health care provision on health outcomes. The fact that regional governments have discretionary powers in deciding health care budgets and that austerity measures have not been implemented uniformly across Spain helps isolate the impact of these policy changes on health indicators of the Spanish population. Using Ruhm’s (2000) fixed effects model, we find that staff or hospital bed reductions account for a significant increase in mortality rates from cardiovascular disease and external causes, for 25-34 and 65-74 year-old groups, and in the late foetal mortality rate. Mortality rates, however, do not seem to be robustly affected by the 2012 changes in retirees’ pharmaceutical co-payments. Contrary to expectations, we find some evidence of reduced mortality rates for cancer and female cancer as a result of the 2012 changes in migrants’ access restrictions to the Spanish NHS. Overall, our analyses suggest that short-term impacts of decreases in health care provision on mortality are significant but small. However, impacts prove to be economically and quantitatively significant in the case of fatalities due to external causes, especially accidental deaths.
    Keywords: Health care provision; Mortality; Health cuts
    JEL: I10 I18
    Date: 2017–06–16
  8. By: Emanuele Ciani (Bank of Italy); Claudio Deiana (European Commission, Joint Research Centre)
    Abstract: Previous empirical literature on the relationship between intergenerational transfers of assets and services has mostly focused on contemporary exchanges. In contrast, we provide novel evidence that parents who helped their adult children in the past are rewarded by a greater likelihood of receiving informal care later in life. To this end we use Italian data to look at retrospective information about how parents help their children to purchase houses when they get married. Our estimates show a positive association with the current provision of informal care, which is robust to controlling for a large set of individual and family characteristics. We provide evidence that this can be explained by various self-interest motives, relating to theories based either on bilateral exchange or on the presence of a third generation of grandchildren, such as those including a demonstration effect or the concept of a family constitution.
    Keywords: informal care, housing, intergenerational transfers, geographical proximity.
    JEL: D10 J13 J14
    Date: 2017–06
  9. By: Alexander, Diane (Federal Reserve Bank of Chicago)
    Abstract: I investigate the relationship between physician pay, C-section use, and infant health, using vital statistics data and newly collected data on Medicaid payments to physicians. First, I confirm past results—when Medicaid pays doctors relatively more for C-sections, they perform them more often. I bolster the causal interpretation of this result by showing that salaried doctors do not respond to this pay differential, and by using a much larger sample of states and years. Second, unlike past work, I look at how changing physician pay affects infant health outcomes. I find that increased C-section use is associated with fewer infant deaths for births likely covered by Medicaid, suggesting that C-section rates may be too low for some groups. Taken together, these findings suggest that policies aimed at decreasing costs by lowering procedure use may have adverse health consequences, especially for low-income patients.
    Keywords: C-sections; Low-income; Medicaid
    JEL: I11 I12 I18
    Date: 2015–07–31
  10. By: Timothy Riffe (Max Planck Institute for Demographic Research, Rostock, Germany); Alyson A. van Raalte (Max Planck Institute for Demographic Research, Rostock, Germany); Maarten J. Bijlsma (Max Planck Institute for Demographic Research, Rostock, Germany)
    Abstract: -
    JEL: J1 Z0
    Date: 2017–05
  11. By: Das, Nimai
    Abstract: This article is based on a study of Public Expenditure Review of Health Spending in Selected States of India as part of research project Strengthening Ecosystem for Sustainable and Inclusive Health Financing in India (SESSIHFI). It is observed that the growth of tied fund to health in real term is much lower than the untied one during 14th FC period irrespective of category of states as EAG and Non-EAG. In search of the root of such shrinkage in tied component, it observed that there is a negative growth of central tied transfer to health between 13th to 14th FCs in both EAG and Non-EAG states. A very comprehensive level of analysis using Demand for Grant of several state-budgets since 2010-11 to till date shows that while the growth of tied fund directly devoted to communicable diseases is affirmative (excepting Chhattisgarh), a serous negative growth of expenditure on non-communicable diseases is observed for most of the EAG states and a few Non-EAG states during 14th FC period.
    Keywords: Intergovernmental transfers, public health, subnational states, federal policy
    JEL: H51 H75 H77 I18
    Date: 2016–12–15
  12. By: Olaf Hübler
    Abstract: Many studies have shown that obesity is a serious health problem for our society. Empirical analyses often neglect a number of methodological issues and relevant influences on health. This paper investigates empirically whether neglecting these items leads to systematically different estimates. Based on data from the German Socio-Economic Panel, this study derives the following results. (1) Many combinations of weight and height lead to the same health status. (2) The relationship between health and body mass index is nonlinear. (3) Underweight strengthens individual health and severe obesity has a clear negative impact on health status. Underweight women are more affected than men but obese men are hit harder than women. (4) The hypothesis has to be rejected that weight has an exogenous influence on health. (5) A worse health status is linked with weight fluctuations and deviations between desired and actual working hours. (6) A healthy diet and long but not too long sleeping contribute to a good health status. Moreover, a good parental education and a high parental social status act favorably on health as does personal high income. (7) Four of the big five components of personality, namely openness, extraversion, conscientiousness and agreeableness, contribute to resilience against health problems.
    Date: 2017
  13. By: Adam Pilny; Ansgar Wübker; Nicolas R. Ziebarth
    Abstract: To equalize differences in health plan premiums due to differences in risk pools, the German legislature introduced a simple Risk Adjustment Scheme (RAS) based on age, gender and disability status in 1994. In addition, effective 1996, consumers gained the freedom to choose among hundreds of existing health plans, across employers and state-borders. This paper (a) estimates RAS pass-through rates on premiums, financial reserves, and expenditures and assesses the overall RAS impact on market price dispersion. Moreover, it (b) characterizes health plan switchers and investigates their annual and cumulative switching rates over time. Our main findings are based on representative enrollee panel data linked to administrative RAS and health plan data. We show that sickness funds with bad risk pools and high pre-RAS premiums lowered their total premiums by 42 cents per additional euro allocated by the RAS. Consequently, post-RAS, health plan prices converged but not fully. Because switchers are more likely to be white collar, young and healthy, the new consumer choice resulted in more risk segregation and the amount of money redistributed by the RAS increased over time.
    Keywords: employer-based health insurance, free health plan choice, risk adjustment, health plan switching, adverse selection, German sickness funds, SOEP
    JEL: D12 H51 I11 I13 I18
    Date: 2017
  14. By: Sheabo Dessalegn, S. (Tilburg University, School of Economics and Management)
    Abstract: This thesis analyzes the effect of social capital on maternal health care use in rural Ethiopia. Reports show that in Ethiopia, despite the huge investment in health infrastructure and the deployment of health professionals to provide maternal health services free of charge, utilization remains low. Here we argue that one of the potential factors behind underutilization or inequality in use of the services is social capital. Social capital is important especially in the rural context, where access to modern means of information is low. Accordingly, this study analyzed the effect of social capital on maternal health care use, employing a broad definition of social capital. The findings show that the use of maternal health services cannot be fully explained using an individual perspective. They show that, among others, social capital is an important determinant for knowing the benefits of maternal health care and translating it into use. Also the findings show that different dimensions of social capital have different effects on maternal health care use. Thus free provision of the services may not ensure use if the potential users have poor knowledge about the services. In a nutshell, this study suggests that social capital is helpful in reducing maternal deaths. Therefore, there is a need to strengthen the current networking of mothers.
    Date: 2017
  15. By: Dang, Thang
    Abstract: Access to medical services is significantly essential for retaining and improving health status for aging population. Whilst retired individuals tend to have more time for the use of health services, there is only inadequate evidence evaluating the causal effect of retirement on health services utilization. To fulfill this gap in the literature especially from developing countries, this paper estimates the causal effect of retirement on the probability and the frequency of doctor visits at public health facilities in urban Vietnam. Employing authorized retirement ages for both men and women in Vietnam as instruments for the probability to be retired, the paper shows that retirement significantly increases some outcomes of outpatient health services for both male and female. In particular, the baseline 2SLS estimates indicate that men who are retired are more likely to have any outpatient medical visit than those who are not retired by about 36.1%. Meanwhile, retirement rises both the likelihood and the frequency of outpatient visits for female by roughly 31% and 1.75 times respectively. However, this paper finds statistically insignificant impacts of retirement on utilization outcomes for inpatient services.
    Keywords: Retirement; Health services utilization; Developing countries
    JEL: C26 I10 J26
    Date: 2017–06–13
  16. By: Vellore Arthi; Brian Beach; W. Walker Hanlon
    Abstract: A large literature following Ruhm (2000) suggests that mortality falls during recessions and rises during booms. The panel-data approach used to generate these results assumes that either there is no substantial migration response to temporary changes in local economic conditions, or that any such response is accurately captured by intercensal population estimates. To assess the importance of these assumptions, we examine two natural experiments: the recession in cotton textile-producing districts of Britain during the U.S. Civil War, and the coal boom in Appalachian counties of the U.S. that followed the OPEC oil embargo in the 1970s. In both settings, we find evidence of a substantial migratory response. Moreover, we show that estimates of the relationship between business cycles and mortality are highly sensitive to assumptions related to migration. After adjusting for migration, we find that mortality increased during the cotton recession, but was largely unaffected by the coal boom. Overall, our results suggest that migration can meaningfully bias estimates of the impact of business-cycle fluctuations on mortality.
    JEL: I1 J60 N32 N33
    Date: 2017–06
  17. By: Virginie Comblon; Karine Marazyan
    Date: 2017
  18. By: Thomas W. Grannemann; Randall S. Brown
    Abstract: With the recent widespread implementation of alternative payment models (APMs), strong designs are needed more than ever to provide evidence for policy decisions about model expansion, modification, or termination for Center for Medicare and Medicaid Innovation (Innovation Center) initiatives.
    Keywords: Alternative Payment Models, Center for Medicare and Medicaid Innovation, Centers for Medicare and Medicaid Services, factorial experiments
    JEL: I

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