nep-hea New Economics Papers
on Health Economics
Issue of 2021‒11‒08
thirteen papers chosen by
Nicolas R. Ziebarth
Cornell University

  1. Child Development in the Early Years: Parental Investment and the Changing Dynamics of Different Domains By Orazio Attanasio; Raquel Bernal; Michele Giannola; Milagros Nores
  2. Subsidizing Inequality: Performance Pay and Risk Selection in Medicare By Michele Fioretti; Hongming Wang
  3. How Do Acquisitions Affect the Mental Health of Employees? By Baghai, Ramin; Bos, Marieke; Bach, Laurent; Silva, Rui
  4. Co-payment exemption and healthcare consumption. Quasi-experimental evidence from Italy By Vanessa Cirulli; Giuliano Resce; Marco Ventura
  5. Healthy reviews! Online physician ratings reduce healthcare interruptions By Kummer, Michael E.; Laitenberger, Ulrich; Rich, Cyrus E.; Hughes, Danny R.; Ayer, Turgay
  6. A sound environment: health effects of traffic noise mitigation By Lindgren, Samuel
  7. The impact of supply-driven variation in time to death on the demand for health care By Laudicella, Mauro; Li Donni, Paolo
  8. Do patents really foster innovation in the pharmaceutical sector? Results from an evolutionary, agent-based model By Giovanni Dosi; Elisa Palagi; Andrea Roventini; Emanuele Russo
  9. The medium-term impact of non-pharmaceutical interventions. The case of the 1918 influenza in US cities By Guillaume Flamerie de la Chapelle
  10. The Value of Vaccines in Maintaining Health System Capacity in England By Brassel S.; Neri M.; Schirrmacher H.; Steuten L.
  11. Divided We Survive? Multi-level Governance and policy uncertainty during the first wave of COVID-19 By Angelici, M.; Berta, P.; Costa-Font, J; Turati, G.
  12. Small Firms and the Pandemic: Evidence From Latin America By Christopher Neilson; Maria Guerrero; John Humphries; Naomi Shimberg; Gabriel Ulyssea
  13. Jabbing the Economy Back to Life? By John Gibson

  1. By: Orazio Attanasio (Yale, IFS, FAIR NHH and NBER); Raquel Bernal (Universidad de Los Andes); Michele Giannola (University College London, Università di Napoli Federico II and CSEF.); Milagros Nores (Rutgers University)
    Abstract: This paper uses the data on child development collected around the evaluation of a nursery program to estimate the details of the process of human development. We model development as made of three latent factors, reflecting health, cognitive and socio-emotional skills. We observe children from age 1 to age 7. We assume that, at each age, these factors interact among themselves and with a variety of other inputs to determine the level of development at following ages. The richness of the data we use allows us to: (i) let the dynamics be rich and flexible; (ii) let each factors play a role in the production of any other factor; (iii) estimate age-specific functional forms; (iv) treat parental investment as an endogenous input. We show that considering parental investment as endogenous affects the estimated level of its productivity. Furthermore, we find that the dynamics of the process can be richer than usually assumed, which determines the degree of persistence of different inputs in time. Persistence also changes with age. The way the productivity of different inputs and the persistence of the process change with age have important implications for the targeting of investment and interventions, and, therefore, the identification of windows of opportunities.
    Keywords: Child development, Human capital, Dynamic production function, Parental investment, Cognitive skills, Health, Socio-emotional skills, Development.
    JEL: I15 I25 I32 J13 J24 O15
    Date: 2021–10–07
  2. By: Michele Fioretti (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique); Hongming Wang (Hitotsubashi University)
    Abstract: Pay-for-performance is commonly employed to improve the quality of social services contracted out to firms. We show that insurer responses to pay-for-performance can widen the inequality in accessing social services. Focusing on the U.S. Medicare Advantage market, we find that high-quality insurance contracts responded to quality-linked payments by selecting healthier enrollees with premium differences across counties. The selection is profitable because the quality rating fails to adjust for pre-existing health differences of enrollees. As a result, quality improved mostly due to selection, and the supply of high-quality insurance shifted to the healthiest counties. Revising the quality rating could prevent these unintended consequences.
    Keywords: Pay-for-Performance,Quality Bonus Payment Demonstration,Medicare Advantage,Risk Selection,Supply-Side Selection,Quality Ratings,Health Inequality
    Date: 2019–11–01
  3. By: Baghai, Ramin (Mistra Center for Sustainable Markets (Misum)); Bos, Marieke (Mistra Center for Sustainable Markets (Misum)); Bach, Laurent (ESSEC Business School Paris); Silva, Rui (Nova School of Business and Economics)
    Abstract: Using employer-employee level data linked to individual health records, we document that the incidence of stress, anxiety, depression, psychiatric medication usage, and even suicide increase following acquisitions. These effects are prevalent among employees from both targets and acquirers, in weak as well as in growing, profitable firms. Employees who experience negative career developments within the merging firms, ’blue-collar’ workers, and employees with lower cognitive and non-cognitive skills are most affected. A variety of tests address endogeneity concerns, including an analysis exploiting failed mergers. Our findings point to mental illness as a significant non-pecuniary cost of acquisitions.
    Keywords: Mergers and Acquisitions; Corporate Restructuring; Mental Health; Mental Illness
    JEL: G34 J81 L23
    Date: 2021–10–26
  4. By: Vanessa Cirulli; Giuliano Resce; Marco Ventura
    Abstract: This paper investigates the causal effect of co-payment exemption on the utilization of healthcare services with a particular emphasis on the number of specialist visits in the Italian National Health System (NHS). As the co-payment exemption may be considered as a sort of insurance, a relevant research question is to ask whether such a protection has had any effect on healthcare services utilization. Exploiting a discontinuity in the multiple eligibility criteria for co-payment exemption, we apply Multiple Regression Discontinuity (MRD) in a quasi-experimental setting, considering both age and income requirements.This discontinuity also allows us to identify the effect of co-payment on a particularly fragile sub-population of less wealthy people. Our findings provide convincing evidence of a positive and significant effect of co-payment exemption on the number of specialist visits. The result may be useful to the policy maker to tailor ad-hoc policies aimed at disadvantaged sub-populations.
    Keywords: Healthcare; Co-payment; Demand effects; Multiple Regression Discontinuity; National Health System
    JEL: I11 I14 I18
    Date: 2021–10
  5. By: Kummer, Michael E.; Laitenberger, Ulrich; Rich, Cyrus E.; Hughes, Danny R.; Ayer, Turgay
    Abstract: We show that review platforms reduce healthcare interruptions for patients looking for a new physician. We employ a difference-in-differences strategy using physician retirements as a 'disruptive shock' that forces patients to find a new physician. We combine insurance claims data with web-scraped physician reviews and highlight a substantial care-gap resulting from a physician's retirement. We then show that online physician reviews reduce this gap and help patients find a new physician faster. Our results are robust to including a variety of controls and various instruments for the availability of physician reviews, but are not found for patients of nonretiring physicians. By reducing interruptions in care, reviews can improve clinical outcomes and lower costs.
    Keywords: Healthcare,Online physician ratings,Online physician reviews,Care-gap
    JEL: I1 I11 I2 O33
    Date: 2021
  6. By: Lindgren, Samuel (Swedish National Road & Transport Research Institute (VTI))
    Abstract: This study investigates the health effects of a nationwide program that provided noise mitigation to dwellings. The analysis uses hospitalization records and a difference-in- differences model that compares residents in treated homes to those with similar at- tributes in untreated homes. Results show that noise mitigation measures lower the risk of cardiovascular diseases by 10% after seven years, with effects driven by reduced risk of hypertension. Health effects are larger among the population exposed to higher baseline noise levels. These findings suggest that implementing similar noise mitigation measures will produce meaningful health benefits.
    Keywords: Health; Environmental policy; Noise pollution
    JEL: Q51 Q52 Q53
    Date: 2021–10–29
  7. By: Laudicella, Mauro (University of Southern Denmark, DaCHE - Danish Centre for Health Economics); Li Donni, Paolo (University of Palermo, Department of Economics, Business and Statistics)
    Abstract: Many high-income countries have successfully reduced hospital mortality in several acute health conditions. We test the hypothesis that variation in the supply of care directed to saving the life of individuals with a health shock may result in increasing the demand for health care as individuals are likely to contribute to the demand after surviving the health shock. We examined repeated cross-sections of individuals exposed to an AMI or a stroke over a time window of ten years in Denmark. Hospital survival probabilities in the interval 0- 30 days from the shock are used as an indicator of the supply, while individual health care expenditure in the interval 31-365 days is used as an indicator of the demand. We find the demand is highly elastic to supply-driven variation in time to death. Results are robust to a placebo test on individuals exposed to the shock without entering time to death.
    Keywords: Health care demand; Hospital quality of care; Time to death
    JEL: I10
    Date: 2021–10–28
  8. By: Giovanni Dosi; Elisa Palagi; Andrea Roventini; Emanuele Russo
    Abstract: The role of the patent system in the pharmaceutical sector is highly debated also due to its strong public health implications. In this paper we develop an evolutionary, agent-based model of the pharmaceutical industry to explore the impact of different configurations of the patent system upon innovation and competition. The model is able to replicate the main stylized facts of the drug industry as emergent properties. We perform policy experiments to assess the impact of different IPR regimes changing the breadth and length of patents. Results suggest that enlarging the extent and duration of patents yields adverse effects in terms of innovation outcomes, as well as of market competition and consumer welfare. Such general conclusions hold even if one takes into account the possible positive effects on R&D intensity and information disclosure triggered by patents.
    Keywords: Innovation; Intellectual property rights; Market power; Pharmaceutical sector; Agent-based models.
    Date: 2021–10–28
  9. By: Guillaume Flamerie de la Chapelle (Sciences Po - Sciences Po, Ausonius-Institut de recherche sur l'Antiquité et le Moyen âge - Université Bordeaux Montaigne - CNRS - Centre National de la Recherche Scientifique)
    Abstract: This paper uses a difference-in-differences (DID) framework to estimate the impact of Non-Pharmaceutical Interventions (NPIs) used to fight the 1918 influenza pandemic and control the resultant mortality in 43 U.S. cities. The results suggest that NPIs such as school closures and social distancing, as implemented in 1918, and when applied for a relatively long and sustained time, might have reduced individual and herd immunity and the population general health condition, thereby leading to a significantly higher number of deaths in subsequent years.
    Keywords: non-pharmaceutical interventions,1918 influenza,difference-in-differences,health policies
    Date: 2020–10–01
  10. By: Brassel S.; Neri M.; Schirrmacher H.; Steuten L.
    Abstract: The NHS is facing unprecedented health system pressure, with a record number of patients waiting for care, while their underlying condition is potentially worsening due to exceptionally long waits. When there is excess demand for health care, treating one patient means losing the opportunity to treat another. These opportunity costs demonstrate the need to consider health system capacity value, one of the so-called 'broader value elements' that is often not fully captured in traditional value assessments. Vaccinations against potentially severe diseases can prevent hospitalisations. For each hospital admission prevented, vaccination accrues direct savings to the health system by not having to treat that patient and avoids the opportunity cost of not being able to use the hospital bed for another patient. In 'normal times' where hospital capacity is typically available (or can be expected to free up within a relatively short time), that opportunity cost is zero. Hence this is not usually considered in value assessment. When there are waiting lists, however, it is positive and potentially large. This report shows that the opportunity cost saved through vaccination rises with increasing levels of excess demand for treatment and the increasing share of patients whose conditions become more severe due to a treatment delay. Using a novel approach, we estimate that the opportunity costs saved by four selected vaccination programmes are about twice the direct savings from prevented hospitalisations. Hence, vaccinations may be substantially undervalued when their broader health system capacity value is not fully accounted for. This approach is important for policymakers and relevant for any health technology that significantly reduces or prevents the need for healthcare resources across various care sectors and for which today's demand already exceeds the relevant capacity.
    Keywords: Value, Affordability, and Decision Making
    JEL: I1
    Date: 2021–10–01
  11. By: Angelici, M.; Berta, P.; Costa-Font, J; Turati, G.
    Abstract: We compare health system responses to the first wave of COVID-19 pandemic in Italy and Spain. Although in both countries, healthcare is managed at the regional level, the central government behaved differently in the uncertainty surrounding the first wave, leaving more autonomy to regional governments in Italy than in Spain. Upon documenting evidence of national and regional health system responses, we show important differences in the number of infected cases, alongside regular and emergency hospital admissions, and mortality in the two countries, both at the national and at the regional level. We then discuss several potential mechanisms, such as policy stringency, the localization of the pandemic and mobility restrictions, measurement error, and especially the regional autonomy, enjoyed by Italian regions but not by Spanish regional governments amidst a state of alarm in both countries. We conclude that, given the strong localized effect of the pandemic, allowing more autonomy, and fostering experimentation and local solutions explains the gap between Italy and Spain in the first wave of the pandemic.
    Keywords: regional health systems; decentralization; policy stringency; health care; COVID-19; Italy; Spain;
    JEL: H75 I18
    Date: 2021–10
  12. By: Christopher Neilson (Princeton University); Maria Guerrero (UCLA); John Humphries (Yale University); Naomi Shimberg (Yale University); Gabriel Ulyssea (UCL)
    Abstract: This paper studies the effects of the COVID-19 pandemic on small businesses between March and November 2020 using new survey data on 35,000 small businesses in eight Latin American countries. We document that the pandemic had large negative impacts on employment and beliefs regarding the future, which in turn predict meaningful economic outcomes in the medium-term. Despite the unprecedented amount of aid, policies had limited impact for small and informal firms. These ï¬ rms were less aware of programs, applied less, and received less assistance. This may have lasting consequences, as businesses that received aid reported better outcomes and expectations about the future.
    Keywords: COVID-19, small business, Latin America
    JEL: I10 D22
    Date: 2021–10
  13. By: John Gibson (University of Waikato)
    Abstract: The pace and scope of Covid-19 vaccination has varied greatly across OECD countries. In this paper, monthly data on vaccination rates for the 32 OECD countries with all-cause mortality rates available are related to seven monthly economic activity indicators: night-time lights and Google Mobility reports for six types of locations. Vaccination rates are also related to Covid response stringency, to Covid cases and deaths, and to all-cause mortality. A standard deviation higher fully vaccinated rate is associated with up to an 0.5 standard deviation larger rise in economic activity over the same month in 2020; an effect due to relaxed response stringency. The partial vaccination rate has no relationship with the economic rebound. These associations with changes in economic activity occur despite no apparent relationship between vaccination rates and changes in Covid-19 cases or changes in mortality.
    Keywords: Covid-19; Google mobility; Mortality; Night-time lights;Vaccination
    JEL: I18 O47
    Date: 2021–10–29

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