nep-hea New Economics Papers
on Health Economics
Issue of 2020‒03‒09
sixteen papers chosen by
Nicolas R. Ziebarth
Cornell University

  1. The Ramadan Effect in the Workplace By Paola Bertoli; Veronica Grembi; Judit Vall-Castello
  2. Physician Health Management Skills and Patient Outcomes By Emilia Simeonova; Niels Skipper; Peter R. Thingholm
  3. Treatment responses of mental health care providers after a demand shock By Rudy Douven; Minke Remmerswaal; Tobias Vervliet
  4. Does managed competition constrain hospitals’ contract prices? Evidence from the Netherlands By Rudy Douven; Monique Burger; Erik Schut
  5. Causes of regional variation in Dutch healthcare expenditures: evidence from movers By Rudy Douven; Minke Remmerswaal; Ana Moura; Martin Salm
  6. Selection and moral hazard effects in healthcare By Minke Remmerswaal; Jan Boone; Rudy Douven
  7. Health Capital Provision and Human Capital Accumulation By Leonid V. Azarnert
  8. The effect of reinsuring a deductible on pharmaceutical spending: A Dutch case study on low-income people By Marielle Non; Rudy Douven; Richard van Kleef; Onno van der Galiën
  9. Value-based clinical trials: selecting trial lengths and recruitment rates in different regulatory contexts By Andres Alban; Stephen E. Chick; Martin Forster
  10. The Effects of E-Cigarette Taxes on E-Cigarette Prices and Tobacco Product Sales: Evidence from Retail Panel Data By Chad D. Cotti; Charles J. Courtemanche; Johanna Catherine Maclean; Erik T. Nesson; Michael F. Pesko; Nathan Tefft
  11. Working Too Much for Too Little: Stochastic Rewards Cause Work Addiction By Brice Corgnet; Simon Gaechter; Roberto Hernán González
  12. Are substitute services a barrier to controlling long-term care expenditures? By Mark Kattenberg; Pieter Bakx
  13. Can your house keep you out of a nursing home? By Maaike Diepstraten; Rudy Douven; Bram Wouterse
  14. Family Decision Making on Healthcare Spending: New Evidence for Nigeria By Glenn P. Jenkins; Hope Amala Anyabolu; Pejman Bahramian
  15. Impact of the West African Ebola Epidemic on Agricultural Production and Rural Welfare : Evidence from Liberia By De La Fuente,Alejandro; Jacoby,Hanan G.; Lawin,Kotchikpa Gabriel
  16. An Assessment of Water, Sanitation and Hygiene Access in Bangladesh's Community Health Clinics By Joseph,George; Alam,Bushra Binte; Shrestha,Anne; Islam,Khairul; Lahiri,Santanu; Ayling,Sophie Charlotte Emi

  1. By: Paola Bertoli; Veronica Grembi; Judit Vall-Castello
    Abstract: We investigate the consequences of Ramadan on the incidence of work accidents. Using daily observations from 2003 to 2016, we exploit the solar rotation of Ramadan days (11 days backward each year) to assess the impact of Ramadan on accidents involving Muslim workers in Spain, estimating a decrease in injuries for these workers with no spillover effects on non Muslim workers (mainly South Americans and Romanians). We explain our results as mainly driven by adjustments at both the extensive and intensive margin in the labor market. We show that the effect is stronger where Ramadan is harsher (longer duration of the fasting day based on latitude), and in provinces where there is a higher concentration of naturalized Muslims. Based on our results, policies supporting religious diversity and reconciling religious practices with the working schedule might decrease health costs related to occupational injuries.
    Keywords: workplace accidents; Ramadan; religious accommodations; Immigrant workers;Classification-JEL: I12, J28, J61, J81
    Date: 2020–02
  2. By: Emilia Simeonova; Niels Skipper; Peter R. Thingholm
    Abstract: A host of different factors affect health and longevity, ranging from genetic endowments to public policy. Physicians have a substantial influence on patients’ health and health-related costs, but we know little about the extent of this influence beyond clinical decisions such as adequate diagnosis and treatment. This paper demonstrates that the health management styles of primary care physicians significantly affect the health outcomes of their patients. Using data on the population of statin users in Denmark and matching patients to their primary care physicians, we show that the physician’s ability to facilitate adherence with prescription medications has significant positive effects on patient outcomes and health costs even after controlling for observable and unobservable patient characteristics. Policy interventions aimed at improving this aspect of physicians’ health management styles have important implications for patient outcomes and health care costs.
    JEL: I1 I12 J18 J24
    Date: 2020–02
  3. By: Rudy Douven (CPB Netherlands Bureau for Economic Policy Analysis); Minke Remmerswaal (CPB Netherlands Bureau for Economic Policy Analysis); Tobias Vervliet (CPB Netherlands Bureau for Economic Policy Analysis)
    Abstract: This paper investigates how two different groups of Dutch mental health care providers responded to an exogenous 20% drop in the number of patients in 2012. Providers that operated under a budget increase treatment duration on average by 8%. We fi nd suggestive evidence for over-treatment as the longer treatments did not result in better patient outcomes, i.e. general assessment of functioning scores. Both professional uncertainty and income effects may explain the results. For the group of self-employed providers, paid by a stepwise fee-for-service function, we find only a small signi cant increase in treatment duration for the least altruistic providers, which we relate to an income effect.
    JEL: H51 I11 I12 J22 J31 J33
    Date: 2019–09
  4. By: Rudy Douven (CPB Netherlands Bureau for Economic Policy Analysis); Monique Burger; Erik Schut
    Abstract: In the Dutch health care system health insurers negotiate with hospitals about the pricing of hospital products in a managed competition framework. In this paper, we study these contract prices that became for the first time publicly available in 2016.
    JEL: I00 I11 L11 L51
    Date: 2018–03
  5. By: Rudy Douven (CPB Netherlands Bureau for Economic Policy Analysis); Minke Remmerswaal (CPB Netherlands Bureau for Economic Policy Analysis); Ana Moura; Martin Salm
    Abstract: We assess the relative importance of demand and supply factors as determinants of regional variation in healthcare expenditures in the Netherlands. Our empirical approach follows individuals who migrate between regions. We use individual data on annual healthcare expenditures for the entire Dutch population between the years 2006 and 2013. Regional variation in healthcare expenditures is mostly driven by demand factors, with an estimated share of around 70%. Both demographics and other unobserved demand factors, e.g. patient preferences, are important components of the demand share.
    JEL: I11 I13 H51
    Date: 2018–10
  6. By: Minke Remmerswaal (CPB Netherlands Bureau for Economic Policy Analysis); Jan Boone (CPB Netherlands Bureau for Economic Policy Analysis); Rudy Douven (CPB Netherlands Bureau for Economic Policy Analysis)
    Abstract: In the Netherlands, average healthcare expenditures of persons without a voluntary deductible are twice as high as average healthcare expenditures of persons with a voluntary deductible. When assessing the effects of voluntary cost-sharing in healthcare on healthcare expenditures, it is important to disentangle moral hazard from selection: are healthcare expenditures low because people pay (a bigger share of) their healthcare expenditures out-of-pocket? Or are people with higher cost-sharing levels healthier? In this study, we separate selection from moral hazard for the combined mandatory and voluntary deductible in the Netherlands. We use proprietary claims data from Dutch health insurers and exploit with a panel regression discontinuity design that we can observe healthcare expenditures before and after the deductibles kick in for 18 year olds. Our study shows that selection, not moral hazard, is the main effect explaining the difference in healthcare expenditures between persons with and without a voluntary deductible. Furthermore, we find that 18 year olds who never chose a voluntary deductible reduce their healthcare spending by 26 euros (on average) in response to a 100 euro increase in the (mandatory) deductible. However, for 18 year olds who chose a voluntary deductible (on top of the mandatory) we find that this choice does not result in a further reduction in healthcare spending.
    JEL: I11 I13 H51
    Date: 2019–03
  7. By: Leonid V. Azarnert
    Abstract: This article analyzes the effect of public policy intervention in the production of health capital on fertility, private investment in children’s health and education and human capital accumulation. I have used a growth model with endogenous fertility, in which the usual parental trade-off between the quantity and quality of their children is augmented with an additional factor that affects children’s human capital, which is health. I analyze the overall society-wide effect of public policy intervention and derive a condition that determines precisely whether public provision of free health services increases or decreases the average level of human capital in the society.
    Keywords: fertility, health capital, human capital, growth
    JEL: D30 I12 J10 J13 J24 O10 O40
    Date: 2020
  8. By: Marielle Non (CPB Netherlands Bureau for Economic Policy Analysis); Rudy Douven (CPB Netherlands Bureau for Economic Policy Analysis); Richard van Kleef (EUR); Onno van der Galiën (Achmea)
    Abstract: The basic health insurance in the Netherlands includes a mandatory deductible of currently 385 euros per adult per year. Several municipalities offer a group contract for low-income people in which the deductible is reinsured, meaning that out-of-pocket spending under the deductible is covered by supplementary insurance. This study examines to what extent such reinsurance leads to higher pharmaceutical spending. We use a unique dataset from a Dutch health insurer with anonymized individual insurance claims for the period 2014-2017. We run a difference-in-difference regression to estimate the effect of reinsurance on pharmaceutical spending. The treatment group consists of enrollees from three municipalities that implemented reinsurance on January 1st 2017. The control group includes enrollees from three municipalities that didn’t implement reinsurance. We find that the introduction of reinsurance led to a statistically significant increase in pharmaceutical spending of 16% in the first quarter of 2017 and 7% in the second quarter. For the second half of 2017 the effect is small and not statistically significant. Conditional on people with low expected spending we find a statistically significant increase in pharmaceutical spending in all four quarters of 2017 varying from 22% to 30% per quarter.
    JEL: I12 I13 C23 D12
    Date: 2018–11
  9. By: Andres Alban; Stephen E. Chick; Martin Forster
    Abstract: Health systems are placing increasing emphasis on improving the design and operation of clinical trials, with a view to increasing the rate of innovation and adoption of health technologies in a ‘value-based’ world. We present a value-based, Bayesian decision-theoretic model of a two-armed clinical trial and health technology adoption decision in which the recruitment rate and duration of the recruitment period are optimised. We account for a wide range of regulatory and practical contexts, addressing questions of how health is valued (considering discounting, the horizon of an adoption decision, and the endogenisation of outcomes for patients in the trial), and the state of clinical practice prior to commencement of the trial (we consider both exploratory trials for pharmaceutical research and pragmatic trials which compare technologies currently in use). We apply the model using research and treatment cost data from an existing trial and health technology assessment and challenge traditional perceptions concerning the efficiency, length and knowledge that may be gained from clinical research when trial teams are charged with delivering ‘value’ efficiently.
    Keywords: Bayesian sequential experimentation; Randomised clinical trials; Health technology assessment
    Date: 2020–02
  10. By: Chad D. Cotti; Charles J. Courtemanche; Johanna Catherine Maclean; Erik T. Nesson; Michael F. Pesko; Nathan Tefft
    Abstract: We explore the effect of e-cigarette taxes enacted in eight states and two large counties on e-cigarette prices, e-cigarette sales, and sales of other tobacco products. We use the Nielsen Retail Scanner data from 2011 to 2017, comprising approximately 35,000 retailers nationally. We calculate a Herfindahl–Hirschman Index of 0.251 for e-cigarette retail purchases, indicating high market concentration, and a tax-to-price pass-through of 1.6. We then calculate an e-cigarette own-price elasticity of -2.6 and a positive cross-price elasticity of demand between e-cigarettes and traditional cigarettes of 1.1, suggesting that e-cigarettes and traditional cigarettes are economic substitutes. We simulate that for every one standard e-cigarette pod (a device that contains liquid nicotine in e-cigarettes) of 0.7 ml no longer purchased as a result of an e-cigarette tax, the same tax increases traditional cigarettes purchased by 6.2 extra packs.
    JEL: I1 I12
    Date: 2020–01
  11. By: Brice Corgnet (Emlyon Business School and Economic Science Institute, Chapman University); Simon Gaechter (Nottingham University); Roberto Hernán González (Burgundy School of Business, Université Bourgogne Franche-Comté)
    Abstract: People are generally assumed to shy away from activities generating stochastic rewards, thus requiring extra compensation for handling any additional risk. In contrast with this view, neuroscience research with animals has shown that stochastic rewards may act as a powerful motivator. Applying these ideas to the study of work addiction in humans, and using a new experimental paradigm, we demonstrate how stochastic rewards may lead people to continue working on a repetitive and effortful task even after monetary compensation becomes saliently negligible. In line with our hypotheses, we show that persistence on the work task is especially pronounced when the entropy of stochastic rewards is high, which is also when the work task generates more stress to participants. We discuss the economic and managerial implications of our findings.
    Keywords: Incentives; Work Addiction; Occupational Health; Experiments
    JEL: C92 D87 D91 M54
    Date: 2020
  12. By: Mark Kattenberg (CPB Netherlands Bureau for Economic Policy Analysis); Pieter Bakx (EUR)
    Abstract: In many developed countries long-term care expenditures are a major source of concern, which has urged policy makers to cost reductions. However, long-term care financing is highly fragmented in most countries and hence reducing total costs is complicated: spending reductions in one type of care may have spillover effects elsewhere in the system. These spillovers may be substantial, as we show using a reform in the financing of one type of publicly financed home care in the Netherlands, domestic help. We show that this reform not only affected consumption of this care type, but also the consumption of three other types of long-term care that are financed through another public scheme.
    JEL: C26 I10
    Date: 2018–09
  13. By: Maaike Diepstraten (CPB Netherlands Bureau for Economic Policy Analysis); Rudy Douven (CPB Netherlands Bureau for Economic Policy Analysis); Bram Wouterse (CPB Netherlands Bureau for Economic Policy Analysis)
    Abstract: We examine the impact of the accessibility of an older individual’s house on her use of nursing home care. We link administrative data on the accessibility of all houses in the Netherlands to data on long-term care use of all older persons from 2011-2014. We find that older people living in more accessible houses are less likely to use nursing home care. The effects increase with age and are largest for individuals aged 90 or older. The effects are stronger for people with physical limitations than for persons with cognitive problems. We also provide suggestive evidence that older people living in more accessible houses substitute nursing home care by home care.
    JEL: I11 I13 H51
    Date: 2019–04
  14. By: Glenn P. Jenkins (Queen’s University, Kingston, Canada and Eastern Mediterranean University, North Cyprus); Hope Amala Anyabolu (Department of Economics, Eastern Mediterranean University, Famagusta, TRNC via Mersin 10); Pejman Bahramian (Department of Economics, Queen's University, Kingston, Ontario K7L 3N6, Canada)
    Abstract: This study examines the determinants of the household healthcare expenditures using the Nigerian General Household Survey, Panel 2012/13. It was found that the key variables are the level of their total expenditures, the gender of the head of household, the size of the household and whether the age of the household members is over 60 years of age. Moreover, we found that the marginal propensity to spend on healthcare is larger for female- headed households and for households with either a head or other member of the household who are more than 60 years of age.
    Keywords: Household expenditures, Health Expenditure, Double Hurdle Model, Nigeria, female- headed households, General Household Survey.
    JEL: R29 I10 B23
    Date: 2019–12
  15. By: De La Fuente,Alejandro; Jacoby,Hanan G.; Lawin,Kotchikpa Gabriel
    Abstract: The 2014-15 Ebola epidemic took a devastating human and economic toll on three West African countries, of which Liberia was perhaps the hardest hit. The pathways through which the crisis affected economic activity in these largely agrarian societies remain poorly understood. To study these mechanisms in the context of rural Liberia, this paper links a geographically disaggregated indicator of Ebola disease mortality to nationally representative household survey data on agricultural production and consumption. The paper finds that higher Ebola prevalence (as proxied by local mortality) led to greater disruption of group labor mobilization for planting and harvest, thereby reducing rice area planted as well as rice yields. Household welfare, measured by per capita expenditures spanning two points before and after the crisis, fell by more in Ebola prevalent areas with more intensive rice farming, precisely those areas that were more adversely affected by agricultural labor shortages.
    Date: 2019–06–11
  16. By: Joseph,George; Alam,Bushra Binte; Shrestha,Anne; Islam,Khairul; Lahiri,Santanu; Ayling,Sophie Charlotte Emi
    Abstract: Adequate water, sanitation and hygiene (WASH) in health care facilities plays a critical role in ensuring improved health care utilization and reducing disease burden due to reinfection. WASH in health facilities is now gaining momentum with the new SDG targets that governments have vowed to meet. This goal callsfor a baseline examination of existing WASH conditions in health facilities. Using data collected through a census of all community health clinics in Bangladesh, this paper presents an analysis of the state of WASH in Bangladesh's rural, public health facilities highlighting that the lack of functionality of WASH facilities is a widespread problem across the country. The paper also identifies priority areas for action when considering the prevalence of poverty and chronic undernutrition at the upazilla level.
    Keywords: Hydrology,Health Care Services Industry,Inequality,Town Water Supply and Sanitation,Water Supply and Sanitation Economics,Sanitation and Sewerage,Engineering,Sanitary Environmental Engineering,Water and Human Health,Health and Sanitation,Environmental Engineering,Small Private Water Supply Providers,Early Child and Children's Health,Nutrition,Reproductive Health
    Date: 2019–06–27

This nep-hea issue is ©2020 by Nicolas R. Ziebarth. 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.