nep-hea New Economics Papers
on Health Economics
Issue of 2017‒08‒20
twelve papers chosen by
Yong Yin
SUNY at Buffalo

  1. Levels of and Changes in Life Satisfaction Predict Mortality Hazards: Disentangling the Role of Physical Health, Perceived Control, and Social Orientation By Gizem Hülür; Jutta Heckhausen; Christiane A. Hoppmann; Frank J. Infurna; Gert G. Wagner; Nilam Ram; Denis Gerstorf
  2. Social Tenants' Health: Evaluating the Effectiveness of Landlord Interventions By Paul Cheshire; Stephen Gibbons; Jemma Mouland
  3. Subsidizing Health Insurance for Low-Income Adults: Evidence from Massachusetts By Amy Finkelstein; Nathaniel Hendren; Mark Shepard
  4. Consumer Learning and the Entry of Generic Pharmaceuticals By Neha Bairoliya; Pinar Karaca-Mandic; Jeffrey S. McCullough; Amil Petrin
  5. The health benefits of a targeted cash transfer: the UK Winter Fuel Payment By Crossley, Thomas F.; Zilio, Federico
  6. Does unemployment aggravate suicide rates in South Africa? Some empirical evidence By Phiri, Andrew; Mukuka, Doreen
  7. Dietary pattern, socioeconomic status and child health outcomes in Ghana: application of multilevel analysis By Nunoo, Jacob; Nyanzu, Frederick
  8. A multilevel latent Markov model for the evaluation of nursing homes' performance By Montanari, Giorgio E.; Doretti, Marco; Bartolucci, Francesco
  9. The Impact of Tobacco Control Policies on Smoking Initiation in Europe By Jan (J.C.) van Ours; Ali Palali
  10. Endogenous Health Groups and Heterogeneous Dynamics of the Elderly By Amengual, D.; Bueren, J.; Crego, J.A.;
  11. Exploring the nexus between certainty in injury compensation and treatment selection By Bertoli,P.; Grembi,V.;
  12. Two-Sided Matching in Physician-Insurer Networks: Evidence from Medicare Advantage By Nosal, K.;

  1. By: Gizem Hülür; Jutta Heckhausen; Christiane A. Hoppmann; Frank J. Infurna; Gert G. Wagner; Nilam Ram; Denis Gerstorf
    Abstract: It is well-documented that well-being typically evinces precipitous decrements at the end of life. However, research has primarily taken a postdictive approach by knowing the outcome (date of death) and aligning in retrospect how well-being has changed for people with documented death events. In the present study, we made use of a predictive approach by examining whether and how levels of and changes in life satisfaction prospectively predict mortality hazards and delineate the role of contributing factors, including health, perceived control, and social orientation. To do so, we applied shared parameter growth-survival models to 20-year longitudinal data from 10,597 participants (n = 1,560 or 15% deceased; age at baseline: M = 44 years, SD = 17, range: 18–98 years) from the national German Socio-Economic Panel Study (SOEP). Our findings showed that lower levels and steeper declines of life satisfaction each uniquely predicted higher mortality risks. Results also reveal moderating effects of age and perceived control: Life satisfaction levels and changes had stronger predictive effects for mortality hazards among older adults. Perceived control is associated with lower mortality hazards; however, this effect is diminished for those who experience accelerated life satisfaction decline. Variance decomposition suggests that predictive effects of life satisfaction trajectories were partially unique (3-6%) and partially shared with physical health, perceived control, and social orientation (16-19 %). Our discussion focuses on the strengths and challenges of a predictive approach to link developmental changes (in life satisfaction) to mortality hazards and considers implications of our findings for healthy aging.
    Keywords: mortality, life satisfaction, perceived control, longitudinal, German Socio-Economic Panel Study (SOEP)
    Date: 2017
  2. By: Paul Cheshire; Stephen Gibbons; Jemma Mouland
    Abstract: Objectives: To test whether a social landlord can improve health outcomes for older tenants and reduce their NHS usage by simple interventions. Design: Randomised controlled trial. Setting: Social housing in five London Boroughs. Participants: 547 individuals over 50 years of age. Intervention: Baseline and two follow-up assessments of individual's health and use of medical services undertaken by health professionals. In the treated groups, individuals were given health care and support at two different levels. 25 individuals had to be removed from the trial because early assessments revealed critical and untreated health issues. Main outcome measures: Self-reported health and wellbeing ratings and NHS usage. Conclusions: Even simple interventions to a targeted group (older and poorer people), can produce significant reductions in NHS usage. Significant reductions were found for 1) planned hospital usage; 2) nights in hospital; and 3) for emergency GP usage. Well-being scores improved in the most strongly treated group but these were not statistically significant. Perhaps the single most important finding was that the early health evaluations revealed that 4.5% of the total sample - not in the most deprived section of the population - had such severe health problems that significant and immediate intervention was required.
    Keywords: randomised control trial, social housing, health interventions
    JEL: I18 C93 R29
    Date: 2017–08
  3. By: Amy Finkelstein; Nathaniel Hendren; Mark Shepard
    Abstract: How much are low-income individuals willing to pay for health insurance, and what are the implications for insurance markets? Using administrative data from Massachusetts’ subsidized insurance exchange, we exploit discontinuities in the subsidy schedule to estimate willingness to pay and costs of insurance among low-income adults. As subsidies decline, insurance take-up falls rapidly, dropping about 25% for each $40 increase in monthly enrollee premiums. Marginal enrollees tend to be lower-cost, consistent with adverse selection into insurance. But across the entire distribution we can observe – approximately the bottom 70% of the willingness to pay distribution – enrollee willingness to pay is always less than half of own expected costs. As a result, we estimate that take-up will be highly incomplete even with generous subsidies: if enrollee premiums were 25% of insurers’ average costs, at most half of potential enrollees would buy insurance; even premiums subsidized to 10% of average costs would still leave at least 20% uninsured. We suggest an important role for uncompensated care for the uninsured in explaining these findings and explore normative implications.
    JEL: H51 I13
    Date: 2017–08
  4. By: Neha Bairoliya; Pinar Karaca-Mandic; Jeffrey S. McCullough; Amil Petrin
    Abstract: Generic pharmaceuticals provide low-cost access to treatment. Despite their chemical equivalence to branded products, many mechanisms may hinder generic substitution. Consumers may be unaware of their equivalence. Firms may influence consumers through advertising or product line extensions. We estimate a structural model of pharmaceutical demand where consumers learn about stochastic match qualities with specific drugs. Naïve models, without consumer heterogeneity and learning, grossly underestimate demand elasticities. Consumer bias against generics critically depends on experience. Advertising and line extensions yield modest increases in branded market shares. These effects are dominated by consumers’ initial perception bias against generics.
    JEL: I1
    Date: 2017–08
  5. By: Crossley, Thomas F.; Zilio, Federico
    Abstract: Each year the UK records 25,000 or more excess winter deaths, primarily among the elderly. A key policy response is the “Winter Fuel Payment†(WFP), a labelled but unconditional cash transfer to older households. The WFP has been shown to raise fuel spending among eligible households. We examine the causal effect of the WFP on health outcomes, including self-reports of chest infection, measured hypertension and biomarkers of infection and inflammation. We find a robust and statistically significant six percentage point reduction in the incidence of high levels of serum fibrinogen. Reductions in other disease markers point to health benefits, but the estimated effects are not robustly statistically significant.
    Date: 2017–08–15
  6. By: Phiri, Andrew; Mukuka, Doreen
    Abstract: Our study investigates the cointegration relationship between suicides and unemployment in South Africa using annual data collected between 1996 and 2015 applied to the ARDL model. Furthermore, our empirical analysis is gender and age specific in the sense that the suicide data is disintegrated into different ‘sex’ and ‘age’ demographics. Our empirical results indicate that unemployment is insignificantly related with suicide rates with the exception for citizens above 75 years. On the other hand, other control variables such as per capita GDP, inflation and divorce appear to be more significantly related with suicides. Collectively, these findings have important implications for policymakers.
    Keywords: Unemployment; Suicide; Cointegration; Causality; South Africa; Sub Saharan Africa (SSA).
    JEL: C22 C51 E24 E31
    Date: 2018
  7. By: Nunoo, Jacob; Nyanzu, Frederick
    Abstract: Introduction – Child welfare, especially issues bordering on child health, continues to be one of the core issues of development. Over the years, appreciable progress has been made, but the levels are still not good enough. Objective - This paper investigates the effects of mothers’ socioeconomic characteristics and regional effect on the health of the child. Also, the paper employs a multilevel estimation technique, a methodology that distinguishes this study from previous studies to investigate in detail, the sources of variation in child health for appropriate policy recommendations Design/methodology/approach - This study revisits the issue on the determinants of child health using the 2012 Ghana version of the Multiple Indicator Cluster Survey, with a sample size of 7364, to investigate how infant diet practices impact child health in Ghana. We estimate the impact of dietary pattern and other socioeconomic characteristics and regional effect on child anthropometric indicators using the multilevel estimation technique to control for clustering effect. Results - We found a dietary pattern to have a positive impact on child health. In addition, we realised that both mother characteristics and regional effect play a role in the growth of the child, but mother characteristics seem the most driving force when mother effects and regional effect are set at play. Conclusion - It is recommended that parents should adhere to the appropriate diet requirement for their children to better health outcome. Also, it is imperative for policies to be geared towards parents as a first step in ensuring a better child health. In addition, policies and programmes directed to the three Northern regions of Ghana are very crucial in supporting a positive child health development for children in Ghana.
    Keywords: Child Health Outcome, Dietary Pattern, Socioeconomic Status, Multilevel Analysis, Ghana
    JEL: I0 I1 I12
    Date: 2017–08–06
  8. By: Montanari, Giorgio E.; Doretti, Marco; Bartolucci, Francesco
    Abstract: The periodic evaluation of health care services is a primary concern for many institutions. In this work, we focus on nursing home services with the aim to produce a ranking of a set of nursing homes based on their capability to improve - or at least to keep unchanged - the health status of the patients they host. As the overall health status is not directly observable, latent variable models represent a suitable approach. Moreover, given the longitudinal and multilevel structure of the available data, we rely on a multilevel latent Markov model where patients and nursing homes are the first and the second level units, respectively. The model includes individual covariates to account for the patient case-mix and the impact of nursing home membership is modeled through a pair of correlated random effects affecting the initial distribution and the transition probabilities between different levels of health status. Through the prediction of these random effects we obtain a ranking of the nursing homes. Furthermore, the proposed model is designed to address non-ignorable dropout, which typically occurs in these contexts because some elderly patients die before completing the survey. We apply our model to the Long Term Care Facilities dataset, a longitudinal dataset gathered from Regione Umbria (Italy). Our results are robust to the sensitivity parameter involved (the number of latent states) and show that differences in nursing homes' performances are statistically significant. The authors certify that they have the right to deposit this contribution in its published format with MPRA.
    Keywords: clustered data, health status evaluation, non-ingorable dropout, random effects
    JEL: C13
    Date: 2017–08–08
  9. By: Jan (J.C.) van Ours (Erasmus School of Economics; Tinbergen Institute, The Netherlands); Ali Palali (CPB)
    Abstract: Our paper investigates the effect of tobacco control policies on smoking initiation in eleven European countries. We analyze longitudinal data of individuals by using information about their age of onset of smoking. We apply hazard rate models to study smoking initiation. Thus, we are able to take into account observed and unobserved personal characteristics as well as the effect of the introduction of a variety of tobacco control policies including bans on tobacco advertisements, smoke-free air regulation, health warnings on packages of cigarettes and treatment programs to help smokers quitting. We find that none of these tobacco control policies influence smoking initiation.
    Keywords: tobacco control policies; smoking initiation; hazard rate models
    JEL: I12 C41
    Date: 2017–08–03
  10. By: Amengual, D.; Bueren, J.; Crego, J.A.;
    Abstract: Health dynamics and its associated medical and care costs have been identified by the macro literature as a major concern of the elderly. Due to its multidimensionality, however, a dicult task faced by researchers is to summarize health parsimoniously into a single state variable. We propose a panel Markov switching model to identify patterns of health heterogeneity where individuals can move across health groups as they age. To estimate the model, we use Markov chain Monte Carlo techniques to exploit information from both the crosssectional and time series dimensions. We identify health groups for individuals in the Health and Retirement Survey for the US. Results show that there exists four clearly diVerentiated groups depending on individualÂ’s physical and mental disabilities. Furthermore, we show that health groups outperform other measures of health commonly used in the literature at explaining the variance in the use of nursing homes, home health care, out of pocket medical expenses and predicted mortality.
    Date: 2017–08
  11. By: Bertoli,P.; Grembi,V.;
    Abstract: We study the effect of reduced medical liability due to the implementation of scheduled damages on the overuse of cesarean sections. Using data from inpatient discharge records on deliveries in Italy, we exploit the fact that hospitals are distributed across court districts and that only some courts introduced schedules during the period of observation. This allows us to identify the effect of a decrease in liability using a difference-in-difference approach while minimizing the heterogeneities between treated and control hospitals. We show that decreased medical liability increases the incidence of unnecessary cesarean sections by 7 percentage points, which corresponds to a 20% increase at the mean of cesarean sections. The magnitude of the response is higher for hospitals with lower quality and that are far from consumer association headquarters. Lower schedules and higher levels of reimbursements per delivery also increase the overuse of cesarean section. The analysis of the response times, combining the difference-in-difference approach with a regression discontinuity design, shows that the response to decreased liability is already detectable in the short run. Our findings are robust to several sets of robustness checks and are not driven by anticipatory effects or a change in the composition of the treated patients.
    Keywords: Scheduled Damages; Cesarean Sections; Difference in Difference;
    JEL: K13 K32 I13
    Date: 2017–08
  12. By: Nosal, K.;
    Abstract: Many health insurance plans in the U.S. restrict enrollees to choose from a set of providers the insurer has contracted with. These provider networks are formed via bilateral bargaining between insurers and providers. Provider networks are an important tool for product differentiation and cost containment for insurers and also put real restrictions on consumers’ choice of providers. In this paper, I analyze matching between insurers offering Medicare Advantage Plans and physicians, using a unique data set consisting of all insurer-physician links in several counties. I estimate parameters of a two-sided, many-to-many matching model which describes formation of provider networks, using the Maximum Score estimator of Fox (2010). This method uses implications of a pairwise stability condition to estimate a joint surplus function which depends on insurer-physician links. The surplus function accounts for the role of physician and insurer characteristics in determining their match values, and also for interactions between physicians linked to the same insurer, whose services may be complements or substitutes. The results indicate that insurers prefer on the margin to link with physicians who increase the specialty concentration of their network and who are located near other physicians in the network. Physicians are negatively affected by having a broader referral network,as defined by having a larger set of physicians with whom they have insurer links in common. Finally, compared with regional insurers, nationally active insurers benefit more from matching with physicians with U.S. medical degree. Preliminary counterfactual analyses suggest that insurers and physicians would be collectively better off if all physicians were matched to all insurers– that is, if selective contracting were eliminated entirely.
    Date: 2017–08

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