nep-hea New Economics Papers
on Health Economics
Issue of 2019‒01‒21
fifteen papers chosen by
Nicolas R. Ziebarth
Cornell University

  1. Reinsurance, Repayments, and Risk Adjustment in Individual Health Insurance: Germany, The Netherlands and the U.S. Marketplaces By Thomas G. McGuire; Sonja Schillo; Richard C. van Kleef
  2. Regional variation in healthcare utilization and mortality By Anna Godøy; Ingrid Huitfeldt
  3. Estimating population average treatment effects from experiments with noncompliance By Kellie Ottoboni; Jason Poulos
  4. The Effect of a Ban on Gender-Based Pricing on Risk Selection in the German Health Insurance Market By Huang, Shan; Salm, Martin
  5. Mothers’ care: reversing early childhood health shocks through parental investments By Cristina Bellés-Obrero; Antonio Cabrales; Sergi Jiménez-Martín; Judit Vall Castello
  6. Ownership and hospital behaviour: Employment and local unemployment By Andrew E. Clark; Carine Milcent
  7. Spending the night?. Provider incentives, capacity constraints and patient outcomes By Ingrid Huitfeldt
  8. Diabetes morbidity after displacement By Bergemann, Annette; Grönqvist, Erik; Guðbjörnsdóttir, Soffia
  9. Is there a ‘pig cycle’ in the labour supply of doctors? How training and immigration policies respond to physician shortages By Xavier Chojnicki; Yasser Moullan
  10. Non-Tariff Barriers and Bargaining in Generic Pharmaceuticals By Sharat Ganapati; Rebecca McKibbin
  11. Impact of Community-Based Health Insurance on Child Health Outcomes: Evidence on Stunting from Rural Uganda By Nshakira-Rukundo, Emmanuel; Mussa, Essa Chanie; Gerber, Nicolas; von Braun, Joachim
  12. Can Community-Based Health Insurance Nudge Preventive Health Behaviours? Evidence from Rural Uganda By Nshakira-Rukundo, Emmanuel; Mussa, Essa Chanie; Nshakira, Nathan; Gerber, Nicolas; von Braun, Joachim
  13. Services for Syrian Refugee Children and Youth in Jordan: Forced Displacement, Foreign Aid, and Vulnerability By Colette Salemi; Jay Bowman; Jennifer Compton
  14. Why are Refugee Children Shorter than the Hosting Population? Evidence from Camps Residents in Jordan By Ahmed Rashad; Mesbah Sharaf; Elhussien Ibrahim Mansour
  15. Syrian Refugees in Jordan: Demographics, Livelihoods, Education, and Health By Caroline Krafft; Maia Sieverding; Caitlyn Keo; Colette Salemi

  1. By: Thomas G. McGuire; Sonja Schillo; Richard C. van Kleef
    Abstract: Reinsurance can complement risk adjustment of health plan payments to improve fit of payments to plan spending at the individual and group level. This paper proposes three improvements in health plan payment systems using reinsurance. First, we base reinsurance payments on spending not accounted for by the risk adjustment system, rather than just high spending. Second, we propose pairing reinsurance for individual-level losses with repayments for individual-level profits. Third, we optimize the weights on the risk adjustors taking account of the presence of reinsurance/repayment. We implement our methodology in data from Germany, The Netherlands and the U.S. Marketplaces, comparing our modified approach to plan payment with risk adjustment as currently practiced in the three settings. The combination of the three improvements yields very substantial improvements in the individual-level fit of payments to plan spending in all three countries.
    JEL: I10 I11
    Date: 2018–12
  2. By: Anna Godøy; Ingrid Huitfeldt (Statistics Norway)
    Abstract: Geographic variation in healthcare utilization has raised concerns of possible inefficiencies in healthcare supply, as differences are often not reflected in health outcomes. Using comprehensive Norwegian microdata, we exploit cross-region migration to analyze regional variation in healthcare utilization. Our results indicate that hospital region factors account for half of the total variation, while the rest reflect variation in patient demand. We find no statistically significant association between the estimated hospital region effects and overall mortality rates. However, we document a negative association with relative utilization-intensive causes of death such as cancer, suggesting high-supply regions may achieve modestly improved health outcomes.
    Keywords: healthcare supply; healthcare demand; healthcare spending; regional variation; health outcomes
    JEL: H51 I1 I11 I13
    Date: 2018–11
  3. By: Kellie Ottoboni; Jason Poulos
    Abstract: This paper extends a method of estimating population average treatment effects to settings with noncompliance. Simulations show the proposed compliance-adjusted estimator performs better than its unadjusted counterpart when compliance is relatively low and can be predicted by observed covariates. We apply the proposed estimator to measure the effect of Medicaid coverage on health care use for a target population of adults who may benefit from expansions to the Medicaid program. We draw randomized control trial data from a large-scale health insurance experiment in which a small subset of those randomly selected to receive Medicaid benefits actually enrolled.
    Date: 2019–01
  4. By: Huang, Shan (DIW Berlin); Salm, Martin (Tilburg University)
    Abstract: Starting from December 2012, insurers in the European Union were prohibited from charging gender-discriminatory prices. We examine the effect of this unisex mandate on risk segmentation in the German health insurance market. While gender used to be a pricing factor in Germany's private health insurance (PHI) sector, it was never used as a pricing factor in the social health insurance (SHI) sector. The unisex mandate makes PHI relatively more attractive for women and less attractive for men. Based on data from the SOEP we analyze how the unisex mandate affects the difference between women and men in switching rates between SHI and PHI. We find that the unisex mandate increases the probability of switching from SHI to PHI for women relative to men. This effect is strongest for self-employed individuals and mini-jobbers. On the other hand, the unisex mandate had no effect on the gender difference in switching rates from PHI to SHI. Because women have on average higher health care expenditures than men, our results imply a reduction of advantageous selection into PHI. Our results demonstrate that regulatory measures such as the unisex mandate can reduce risk selection between public and private health insurance sectors.
    Keywords: unisex mandate, public and private health insurance, risk selection, Germany
    JEL: I13 D82 H51
    Date: 2018–11
  5. By: Cristina Bellés-Obrero; Antonio Cabrales; Sergi Jiménez-Martín; Judit Vall Castello
    Abstract: We explore the effects of a child labor regulation that changed the legal working age from 14 to 16 over the health of their offspring. We show that the reform was detrimental for the health of the son’s of affected parents at delivery. Yet, in the medium run, the effects of the reform are insignificant for both male and female children. The sons of treated mothers are perceived as still having worse health at older ages, even if their objective health status has recovered. These boys are also more likely to have private health insurance, which suggests more concerned mothers.
    Keywords: minimum working age, education, child health, gender
    JEL: J81 I25 I12 J13
    Date: 2019–01
  6. By: Andrew E. Clark (PSE - Paris School of Economics, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique); Carine Milcent (PSE - Paris School of Economics, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique)
    Abstract: In this paper, we address two issues: i) how hospital employment changes with local unemployment, according to the type of hospital ownership, and ii) whether this relationship changed after the implementation of a pro-competitive reform that made hospitals more similar. A 2006–2010 French panel of 1695 hospitals over five waves allows us to consider within-hospital employment changes. We first find that higher local unemployment is associated with greater employment in State-owned hospitals, but not for any other hospital ownership type: French local authorities then seem to respond to depressed local labour markets by increasing employment in State-owned hospitals. After the full implementation of the pro-competitive reform hospital funding became based only on activity and no longer on some historical budget. Theoretically, the new reimbursement system should break the relationship between public-hospital employment and local unemployment. Our results reveal that the reform worked as expected in less-deprived areas: reducing employment and eliminating the correlation between local unemployment and State-owned hospital employment. However, in higher-unemployment areas, public-hospital employment remains counter-cyclical. Poor local labour-market health then seems to trump financial incentives in determining employment in public hospitals.
    Keywords: Public employment,Competition,Management,Unemployment,France,Hospitals
    Date: 2018–04
  7. By: Ingrid Huitfeldt (Statistics Norway)
    Abstract: Healthcare providers’ response to payment incentives may have consequences for both fiscal spending and patient health. This paper studies the effects of a change in the payment scheme for hospitals in Norway. In 2010, payments for patients discharged on the day of admission were substantially decreased, while payments for stays lasting longer than one day were increased. This gave hospitals incentives to shift patients from one-day stays to two-day stays, or to decrease the admission of one-day stays. I study hospital responses by exploiting the variable size of price changes across diagnoses in a difference-in-differences framework. I find no evidence that hospitals respond to price changes, and capacity constraints do not appear to explain this finding. Results imply that the current payment policy yields little scope for policymakers to affect the healthcare spending and treatment choices.
    Keywords: Provider incentives; hospital reimbursement; price response; capacity constraints
    JEL: H51 H75 I11 I18
    Date: 2018–11
  8. By: Bergemann, Annette (University of Bristol); Grönqvist, Erik (IFAU - Institute for Evaluation of Labour Market and Education Policy); Guðbjörnsdóttir, Soffia (University of Gothenburg)
    Abstract: We investigate how career disruptions in terms of job loss may impact morbidity for individuals diagnosed with type 2 diabetes (T2D). Combining unique, high-quality longitudinal data from the Swedish National Diabetes Register (NDR) with matched employer-employee data, we focus on individuals diagnosed with T2D, who are established on the labor market and who lose their job in a mass layoff. Using a conditional Difference-in-Differences evaluation approach, our results give limited support for job loss having an impact on health behavior, diabetes progression and cardiovascular risk factors.
    Keywords: Job displacement; Health; Diabetes; Unemployment
    JEL: I10 I14 J63
    Date: 2018–10–09
  9. By: Xavier Chojnicki (EQUIPPE - Economie Quantitative, Intégration, Politiques Publiques et Econométrie - Université de Lille, Sciences et Technologies - Université de Lille, Sciences Humaines et Sociales - PRES Université Lille Nord de France - Université de Lille, Droit et Santé, LEM - Lille - Economie et Management - CNRS - Centre National de la Recherche Scientifique - UCL - Université catholique de Lille - Université de Lille); Yasser Moullan (IRDES - Institut de Recherche et Documentation en Economie de la Santé, IMI - International Migration Institute - University of Oxford [Oxford], CEMOI - Centre d'Économie et de Management de l'Océan Indien - UR - Université de la Réunion)
    Abstract: Many OECD countries are faced with the considerable challenge of a physician shortage. This paper investigates the strategies that OECD governments adopt and determines whether these policies effectively address these medical shortages. Due to the amount of time medical training requires, it takes longer for an expansion in medical school capacity to have an effect than the recruitment of foreign-trained physicians. Using data obtained from the OECD (2014) and Bhargava et al. (2011), we constructed a unique country-level panel dataset that includes annual data for 17 OECD countries on physician shortages, the number of medical school graduates and immigration and emigration rates from 1991 to 2004. By calculating panel fixed-effect estimates, we find that after a period of medical shortages, OECD governments produce more medical graduates in the long run but in the short term, they primarily recruit from abroad; however, at the same time, certain practising physicians choose to emigrate. Simulation results show the limits of recruiting only abroad in the long term but also highlight its appropriateness for the short term when there is a recurrent cycle of shortages/surpluses in the labour supply of physicians (pig cycle theory).
    Keywords: Physician shortages,International migration of doctors,Medical graduates,Foreign-trained physicians
    Date: 2018–03
  10. By: Sharat Ganapati (Walsh School of Foreign Service and Department of Economics, Georgetown University); Rebecca McKibbin (School of Economics, University of Sydney)
    Abstract: Pharmaceutical prices are widely dispersed across countries with comparable quality standards. We study two elements of this dispersion; non-tariff barriers and buyer bargaining power. Under monopoly, generic drug prices are 3-4 times higher in the United States. With 6 or more competitors, generic drug prices are similar across countries. Motivated by this, we use a bargaining model to examine two policy solutions to reduce drug prices. First, we remove non-tariff barriers to increase the number of competitors through a reciprocal approval arrangement and market entry. Second, we explore the US government's unexploited purchasing power to negotiate drug prices. Regarding Medicaid, the first measure can reduce total expenditures by 8% and the second by 18%. There is very little additional savings from doing both procedures in tandem.
    Keywords: Law of One Price, Competition, Bargaining, Pharmaceuticals, Non-Tariff Barriers, Healthcare Economics, International Trade
    JEL: I11 F14 L44
    Date: 2019–01–10
  11. By: Nshakira-Rukundo, Emmanuel; Mussa, Essa Chanie; Gerber, Nicolas; von Braun, Joachim
    Abstract: While community-based health insurance (CBHI) becomes increasingly integrated into health systems in developing countries, there is still limited research and evidence on its probable health impacts beyond its functions for health financing or for facilitating access to services. Using a cross-sectional data from rural south-west Uganda, we apply a two-stage residual inclusion instrumental variables method to study the impact of community health insurance on stunting in children under five years. Results indicate that each year a household was enrolled in insurance was causally associated with a reduction in the probability of stunting of 5.7 percentage points. Predictive marginal effects show that children in households which have had insurance for at least 5 years had a probability of stunting of only 0.353 compared to 0.531 for children in households with no insurance. Households in CBHI were more likely to attend more free antenatal and postnatal care visits and report fewer illnesses and reported less health expenditures. Moreover, CBHI enrolment was also associated with reduced health costs. We recommend that developing countries should facilitate the expansion of community health insurance scheme not only for their contribution to health financing but even more for mortality and morbidity aversion.
    Keywords: Health Economics and Policy, Research Methods/ Statistical Methods
    Date: 2019–01–14
  12. By: Nshakira-Rukundo, Emmanuel; Mussa, Essa Chanie; Nshakira, Nathan; Gerber, Nicolas; von Braun, Joachim
    Abstract: Community-based health insurance (CBHI) schemes have emerged as strong pathways to universal health coverage in developing countries. Their examination has largely focussed on their impacts on financial protection and on the utilisation of curative health services. However, very little is known about their possible effect on utilisation of preventive health services and strategies and yet developing countries continue to carry a burden of easily preventable illnesses. To understand if this effect exists, we carry out a cross-sectional survey in communities served by a large CBHI scheme in rural south-western Uganda. We then apply inverse probability weighting of the propensity score to analyse quasiexperimental associations. We find that the probabilities for using long-lasting mosquito nets, vitamin A and iron supplementation and child deworming were significantly increased with participation in CBHI. We postulate that this effect is partly due to information diffusion and social learning within CBHI-participating burial groups. This work gives insight into the broader effects of CBHI in developing countries, beyond financial protection and utilisation of hospital-based services.
    Keywords: Health Economics and Policy, Research Methods/ Statistical Methods
    Date: 2019–01–14
  13. By: Colette Salemi (University of Minnesota); Jay Bowman; Jennifer Compton
    Abstract: This report provides an overview of the current services available for Syrian refugee youth and children in Jordan, with a focus on the following sectors: education, cash assistance, nutrition, health, livelihoods, water and sanitation, shelter, and protection. Using a multi-method strategy, we describe the governance structure of the current Syrian refugee assistance program in Jordan and describe the policies central to our sectors of interest. Based on key informant interviews, we identify persistent barriers to services for Syrian young people. The report concludes with a discussion of overall governance constraints.
    Date: 2018–05–03
  14. By: Ahmed Rashad (Economic Studies and Policies Sector, Government of Dubai); Mesbah Sharaf; Elhussien Ibrahim Mansour
    Abstract: The literature on children’s health inequalities in refugee camps in Jordan remains sparse. We noticed a marked height difference between Palestinian children living in the refugee camps and children of the remaining population in Jordan. Children living in refugee camps are significantly shorter than the rest of the children in the hosting population. This paper explores the drivers of the height gap, measured by the height for age z-score, among children residing in refugee camps and the non-camp residents. A Blinder- Oaxaca decomposition is used to quantify the sources of the inequalities between the two groups into two components; one that is explained by regional differences in the level of the determinants, and another part that is explained by differences in the effect of the determinants of the child nutritional status. Our results suggest that the endowment effect dominates the coefficients effect. More specifically, the height gap is mainly driven by wealth disparities between the two groups. Poverty alleviation programs such as conditional cash transfers and microfinance to camps’ residents are likely to reduce the child malnutrition gap.
    Date: 2018–06–07
  15. By: Caroline Krafft (St. Catherine University); Maia Sieverding; Caitlyn Keo; Colette Salemi
    Abstract: Since 2011, Jordan has been hosting a substantial number of refugees from Syria. This paper profiles the Syrian refugee population in Jordan in terms of demographic characteristics, participation in the labor market, education, and health outcomes. Syrian refugees are disproportionately young, with half the refugee population under age 15. Despite the availability of work permits, less than a fifth of refugees are working, and those who do work are primarily in informal employment and working without permits. Enrollment rates are well below universal, with many refugee children not returning to school after an interruption, which was often caused by the conflict. Low enrollment rates also suggest that refugees face challenges in persisting in school in Jordan through basic education. Refugees have limited access to health insurance and although most do access health services, they are more likely than Jordanians to rely on charitable organizations and pharmacies as their usual source of care. Despite food supports, refugees, particularly those residing in camps, also suffer from higher levels of food insecurity.
    Date: 2018–04–26

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