The political economy of the public–private mix in heath expenditure: An empirical review of thirteen OECD countries

This study investigates the factors that may have influenced the public–private mix of health expenditure in 13 OECD countries from 1981 to 2007. The degree to which health services are socialized is regarded as the product of a trade-off between the desire to redistribute income through the fiscal system and the losses some citizens will incur when the public health care system expands.     

Time is money: outpatient waiting times and health insurance choices of elderly veterans in the United States

Growth in the number of days between an appointment request and the actual appointment reduces demand. Although such waiting times are relatively low in the US, current policy initiatives could cause them to increase. We estimate multiple-equation models of physician utilization and insurance plan choice for Medicare-eligible veterans. We find that a 10% increase in VA waiting times increases demand for Medigap insurance by 5%, implying that a representative patient would be indifferent between waiting an average of 5 more days for VA appointments and paying $300 more in annual premium.     

Financial protection of patients through compensation of providers: The impact of Health Equity Funds in Cambodia

Public providers have no financial incentive to respect their legal obligation to exempt the poor from user fees. Health Equity Funds (HEFs) aim to make exemptions effective by giving NGOs responsibility for assessing eligibility and compensating providers for lost revenue. We use the geographic spread of HEFs over time in Cambodia to identify their impact on out-of-pocket (OOP) payments. Among households with some OOP payment, HEFs reduce the amount paid by 35%, on average. The effect is larger for households that are poorer and mainly use public health care. Reimbursement of providers through a government operated scheme also reduces household OOP payments but the effect is not as well targeted on the poor. Both compensation models raise household non-medical consumption but have no impact on health-related debt. HEFs reduce the probability of primarily seeking care in the private sector.     

The effect of eliminating health user fees on adult health and labor supply in Jamaica

This paper estimates the effects of Jamaica’s elimination of user fees in public health facilities on the health and labor supply of working-age individuals. The policy change affected about 83 percent of the population, that is, those who lack health insurance and mainly rely on the public health system. The analysis finds no effects among individuals younger than 40 years old. However, for individuals within the 40–64 age range, the analysis finds that the policy reduced the number of lost days due to illness by 44.3 percent. No effects were found on employment or labor formality at the extensive margin. However, consistent with a reduced number of lost days, the analysis identified a positive effect on labor supply at the intensive margin equivalent to 3.04 weekly hours. Finally, overall benefits are relatively stronger for women, thereby reducing the observed baseline disadvantages relative to men.     

Optimal public provision of nursing homes and the role of information

Increasing demand for long-term care poses at least five challenges to the policy-maker: (i) How should care be supplied, within a nursing home or within the family? (ii) What level of care should be provided in the different arrangements? (iii) How do the answers relate to the severity of dependence? (iv) How can financial strain be mitigated for families with severely dependent members? (v) What is the role of information constraints for the nature and scope of optimal long-term care policy? We consider a theoretical model of long-term care provision under adverse selection to address these challenges. Our main - and remarkably robust - result is that nursing home care facilitates self selection and mitigates and possibly eliminates distortions in caring levels and transfers. Informational asymmetries may thus lead to care being provided too often within institutions rather than within a family context.     

Health Insurance and Health Care among the Mid‐Aged and Older Chinese: Evidence from the National Baseline Survey of CHARLS

We document the recent profile of health insurance and health care among mid‐aged and older Chinese using data from the China Health and Retirement Longitudinal Study conducted in 2011. Overall health insurance coverage is about 93%. Multivariate regressions show that respondents with lower income as measured by per capita expenditure have a lower chance of being insured, as do the less‐educated, older, and divorced/widowed women and rural‐registered people. Premiums and reimbursement rates of health insurance vary significantly by schemes. Inpatient reimbursement rates for urban people increase with total cost to a plateau of 60%; rural people receive much less. Demographic characteristics such as age, education, marriage status, per capita expenditure, and self‐reported health status are not significantly associated with share of out‐of‐pocket cost after controlling community effects. For health service use, we find large gaps that vary across health insurance plans, especially for inpatient service. People with access to urban health insurance plans are more likely to use health services. In general, Chinese people have easy access to median low‐level medical facilities. It is also not difficult to access general hospitals or specialized hospitals, but there exists better access to healthcare facilities in urban areas. Copyright © 2016 John Wiley & Sons, Ltd.     

HEALTH INSURANCE TAX CREDITS,THE EARNED INCOME TAX CREDIT,AND HEALTH INSURANCE COVERAGE OF SINGLE MOTHERS

The Omnibus Budget Reconciliation Act of 1990 enacted a refundable tax credit for low‐income working families who purchased health insurance coverage for their children. This health insurance tax credit (HITC) existed during tax years 1991, 1992, and 1993, and was then rescinded. A difference‐in‐differences estimator applied to Current Population Survey data suggests that adoption of the HITC, along with accompanying increases in the Earned Income Tax Credit (EITC), was associated with a relative increase of about 4.7 percentage points in the private health insurance coverage of working single mothers with high school or less education. Also, a difference‐in‐difference‐in‐differences estimator, which attempts to net out the possible influence of the EITC increases but which requires strong assumptions, suggests that the HITC was responsible for about three‐quarters (3.6 percentage points) of the total increase. The latter estimate implies a price elasticity of health insurance take‐up of ?0.42. Copyright © 2013 John Wiley & Sons, Ltd.     

The effect of Paragraph IV decisions and generic entry before patent expiration on brand pharmaceutical firms

This purpose of this paper is to investigate the impact of Paragraph IV patent infringement decisions on brand drug pharmaceutical firms. Paragraph IV decisions determine whether a generic firm can enter before the period of exclusivity ends. I construct a novel dataset of all Paragraph IV decisions and find that they disproportionately involve the highest revenue drugs, significant periods of patent protection, and a non-trivial portion of all brand drugs facing generic entry. I also estimate the impact of Paragraph IV decisions on brand firm profitability and find they have large value consequences.     

Commentary: Soda taxes, obesity, and the shifty behavior of consumers

Rising obesity is a threat to public health, and taxing sugar-sweetened beverages (SSBs) in order to reduce consumption and thus caloric intake could be a viable policy response. But raising the price of SSB calories will raise the quantity demanded of relatively cheaper calories, and net effect on obesity is unclear. I review the evidence on shifting calorie demand and discuss the viability of soda taxes to achieve improvements in public health.     

Effects of breast and colorectal cancer on labour market outcomes—Average effects and educational gradients

We estimate causal effects of breast and colorectal cancer on labour market outcomes 1–3 years after the diagnosis. Based on Danish administrative data we estimate average treatment effects on the treated by propensity score weighting methods using persons with no cancer diagnosis as control group. We conduct robustness checks using matching, difference-in-differences methods and an alternative control group of later cancer patients. The different methods give approximately the same results. Cancer increases the risks of leaving the labour force and receiving disability pension, and the effects are larger for the less educated. Effects on income are small and mostly insignificant. We investigate some of the mechanisms which may be important in explaining the educational gradient in effects of cancer on labour market attachment.     

Staffing subsidies and the quality of care in nursing homes

Concerns about the quality of state-financed nursing home care has led to the wide-scale adoption by states of pass-through subsidies, in which Medicaid reimbursement rates are directly tied to staffing expenditure. We examine the effects of Medicaid pass-through on nursing home staffing and quality of care by adapting a two-step FGLS method that addresses clustering and state-level temporal autocorrelation. We find that pass-through subsidies increases staffing by about 1% on average and 2.7% in nursing homes with a low share of Medicaid patients. Furthermore, pass-through subsidies reduce the incidences of pressure ulcer worsening by about 0.9%.     

Anatomy of a health scare: education, income and the MMR controversy in the UK

The measles, mumps and rubella (MMR) controversy provides an interesting case where, for a short period of time, research publicized in the media, suggested a potential risk of serious side-effects associated with the vaccine, where there was also a sharp behavioral response from the public, and where the initial information was subsequently overturned. We consider the controversy from the perspective of health inequalities and the assimilation of information, focusing on whether and how vaccine uptake behavior in the wake of the controversy differed among groups of parents by education and income. Using panel data on the variation in the uptake of the MMR, and other childhood immunizations, across local Health Authority areas we find that the uptake rate of the MMR declined faster in areas where a larger fraction of parents had stayed in education past the age of 18 than in areas with less educated parents. We also find that the same areas reduced their relative uptake of other uncontroversial childhood immunizations, suggesting a "spillover" effect. Using a supplementary data source we find evidence of a corresponding positive income effect, indicating that wealthier parents avoided the MMR dilemma by purchasing single vaccines.     

Medicaid's effect on single women's labor supply: evidence from the introduction of Medicaid

This paper examines the impact of the introduction of the Medicaid program on labor supply decisions among single women in the late 1960s and early 1970s. I use a differences-in-differences-in-differences methodology to estimate the effect of Medicaid on eligible women's labor force participation, using variation in the timing of Medicaid implementation across states and in eligibility across demographic groups. Using March supplements to the CPS from 1963 to 1975, I find no evidence that women who were eligible for Medicaid decreased their labor supply relative to ineligible women, in contrast to clear theoretical predictions of a negative supply response. Positive point estimates suggest that health benefits from health insurance coverage may have contributed to relative increases in labor supply. These results add to an emerging consensus that public health insurance programs for low-income parents and children may be able to improve access to care without substantial indirect costs from labor supply distortions.     

The impact of legalized abortion on child health outcomes and abandonment. Evidence from Romania

We use household survey data and a unique census of institutionalized children to analyze the impact of abortion legalization in Romania. We exploit the lift of the abortion ban in December 1989, when communist dictator Ceausescu and his regime were removed from power, to understand its impact on children's health at birth and during early childhood and whether the lift of the ban had an immediate impact on child abandonment. We find insignificant estimates for health at birth outcomes and anthropometric z-scores at age 4 and 5, except for the probability of low birth weight which is slightly higher for children born after abortion became legal. Additionally, our findings suggest that the lift of the ban had decreased the number of abandoned children.     

Excise tax avoidance: The case of state cigarette taxes

We conduct an applied welfare economics analysis of cigarette tax avoidance. We develop an extension of the standard formula for the optimal Pigouvian corrective tax to incorporate the possibility that consumers avoid the tax by making purchases in nearby lower tax jurisdictions. To provide a key parameter for our formula, we estimate a structural endogenous switching regression model of border-crossing and cigarette prices. In illustrative calculations, we find that for many states, after taking into account tax avoidance the optimal tax is at least 20% smaller than the standard Pigouvian tax that simply internalizes external costs. Our empirical estimate that tax avoidance strongly responds to the price differential is the main reason for this result. We also use our results to examine the benefits of replacing avoidable state excise taxes with a harder-to-avoid federal excise tax on cigarettes.     

The changing of the guards : Can family doctors contain worker absenteeism?

Using administrative data from Norway, we examine the extent to which family doctors influence their clients’ propensity to claim sick-pay. The analysis exploits exogenous switches of family doctors occurring when physicians quit, retire, or for other reasons sell their patient lists. We find that family doctors have significant influence on their clients’ absence behavior, particularly on absence duration. Their influence is stronger in geographical areas with weaker competition between physicians. We conclude that it is possible for family doctors to contain sick-pay expenditures to some extent, and that there is a considerable variation in the way they perform this task.