Allocating Bodies
Employer-sponsored health insurance and labor market outcomes for men in same-sex couples: Evidence from the advent of pre-exposure prophylaxis
Conor Lennon
Economics & Human Biology, forthcoming
Abstract:
In the United States, the cost of providing employer-sponsored health insurance (ESI) varies for employers based on the medical expenditures of their employees, a practice known as “experience rating”. Experience rating increases the cost of employing workers who have greater medical expenditures, one example being men in same-sex couples. To study whether ESI affects labor market outcomes for men in same-sex couples, I use the 2012 advent of Pre-Exposure Prophylaxis (PrEP), a $24,000 per year drug that effectively prevents Human Immunodeficiency Virus (HIV) acquisition. Using American Community Survey data and a difference-in-difference empirical approach -- comparing post-PrEP changes in earnings among men who have ESI -- I find that annual earnings for men in same-sex couples decline by $2,650 (approximately 3.9%) relative to comparable men after PrEP becomes available. For those who are most likely to be taking Truvada (the brand name for PrEP), such as young men and white men, effects on earnings are considerably larger. I also observe a 3.7 percentage point (4.6%) decline in ESI prevalence and a 0.8 percentage point (10.7%) increase in part-time employment among men in same-sex couples. Event studies provide support for a causal interpretation for my findings. My estimates are also robust to placebo analyses, various specification permutations, and a range of sensitivity checks.
Trends in Adverse Event Rates in Hospitalized Patients, 2010-2019
Noel Eldridge et al.
Journal of the American Medical Association, 12 July 2022, Pages 173-183
Design, Setting, and Participants:
This serial cross-sectional study used data from the Medicare Patient Safety Monitoring System from 2010 to 2019 to assess in-hospital adverse
events in patients. The study included 244 542 adult patients hospitalized in 3156 US acute care hospitals across 4 condition groups from 2010 through 2019: acute myocardial infarction (17%), heart failure (17%), pneumonia (21%), and major surgical procedures (22%); and patients hospitalized from 2012 through 2019 for all other conditions (22%).
Results:
The study sample included 190 286 hospital discharges combined in the 4 condition-based groups of acute myocardial infarction, heart failure, pneumonia, and major surgical procedures (mean age, 68.0 [SD, 15.9] years; 52.6% were female) and 54 256 hospital discharges for the group including all other conditions (mean age, 57.7 [SD, 20.7] years; 59.8% were female) from 3156 acute care hospitals across the US. From 2010 to 2019, the total change was from 218 to 139 adverse events per 1000 discharges for acute myocardial infarction, from 168 to 116 adverse events per 1000 discharges for heart failure, from 195 to 119 adverse events per 1000 discharges for pneumonia, and from 204 to 130 adverse events per 1000 discharges for major surgical procedures. From 2012 to 2019, the rate of adverse events for all other conditions remained unchanged at 70 adverse events per 1000 discharges. After adjustment for patient and hospital characteristics, the annual change represented by relative risk in all adverse events per 1000 discharges was 0.94 (95% CI, 0.93-0.94) for acute myocardial infarction, 0.95 (95% CI, 0.94-0.96) for heart failure, 0.94 (95% CI, 0.93-0.95) for pneumonia, 0.93 (95% CI, 0.92-0.94) for major surgical procedures, and 0.97 (95% CI, 0.96-0.99) for all other conditions. The risk-adjusted adverse event rates declined significantly in all patient groups for adverse drug events, hospital-acquired infections, and general adverse events. For patients in the major surgical procedures group, the risk-adjusted rates of events after a procedure declined significantly.
The Value of Pharmacy Benefit Management
Casey Mulligan
NBER Working Paper, July 2022
Abstract:
In theory, equilibrium profits for drug patent holders would not involve significant restraints on production and patient utilization if the market had a mechanism for two-part pricing (Oi 1971) or quantity commitments (Murphy, Snyder, and Topel 2014). In fact, patent expiration has little effect on drug utilization especially when those drugs are delivered through insurance plans. This paper provides a quantitative model consistent with the theory and evidence in which pharmacy benefit management on behalf of insurance plans serves these and other purposes in both monopoly and oligopoly provider settings. Calibrating the model to the U.S. market, I conclude that pharmacy benefit management is worth at least $145 billion annually beyond its resource costs. PBM services add at least $192 billion annually in value to society compared to a manufacturer price-control regime. Requiring all PBM services to be self-provided by plan sponsors would forgo about 40 percent of the net value of PBM services largely by increasing management costs. Due to changes in the incidence of PBM services over the drug life cycle, the services encourage innovation even though they reduce the profits of incumbent manufacturers.
Producing Health: Measuring Value Added of Nursing Homes
Liran Einav, Amy Finkelstein & Neale Mahoney
NBER Working Paper, August 2022
Abstract:
We develop a stylized model that allows us to estimate a value-added measure for nursing homes (“SNFs”) which accounts for patient selection both into and out of a SNF. We use the model, together with detailed data on the physical and mental health of about 6 million Medicare SNF patients between 2011 and 2016, to estimate the value added for about 14,000 distinct SNFs. We document substantial heterogeneity in value added. Nationwide, compared to a 10th percentile SNF, a 90th percentile SNF is able to discharge a patient at the same health level about a week sooner, which is about one third of the median length of stay. Heterogeneity in value added within a market is almost as large as it is nationwide. Our results point to the potential for substantial gains through policies that encourage reallocation of patients to higher-quality SNFs within their market.
Rural Medicare beneficiaries are increasingly likely to be admitted to urban hospitals
Hannah Friedman & George Mark Holmes
Health Services Research, forthcoming
Objective:
To determine whether rural Medicare FFS beneficiaries are more likely to be admitted to an urban hospital in 2018 than in 2010.
Study Design:
We conducted a fixed-effects negative-binomial regression to determine whether urban hospital admissions from rural ZIP codes were increasing over time. We also conducted an exploratory geographically weighted regression.
Principal Findings:
Controlling for distance to the nearest hospitals, an increase of 1 year was associated with a 2.0% increase (p < 0.001) in the number of admissions to urban hospitals from each rural ZIP code. New system affiliation of the nearest rural hospital was associated with an increase of 1.7% (p < 0.001).
Clouded Motives and Pharmacological Calvinism: How Recreational Use of a Drug Affects Moral Judgments of its Medical Use
Anne Wilson
Journal of Public Policy & Marketing, forthcoming
Abstract:
While many drugs are used exclusively for medical reasons, and others are used solely for recreational enjoyment, some drugs are commonly used for both purposes. For example, cannabis, opioids, and stimulants are unique in many ways, but they share the fact that they are regularly consumed both medicinally and recreationally (Dinnin Huff, Humphreys, and Wilner 2021; Drazdowski 2016). However, it is not clear how the existence of recreational markets for substances affects moral judgments of their medical use. The current work shows that using a drug for medical reasons is viewed as less morally acceptable if other consumers use the same drug for recreational enjoyment. This effect emerges due to observers inferring that medical users are less purely motivated by medical need. Accordingly, the negative effect of recreational drug use on moral judgments of its medical use is mitigated when patients do not have alternative treatment options. These findings have implications for patient stigmatization, drug marketing and lobbying, and for policy and legislation designed to regulate the use of medical drugs with recreational benefits.
Do Chargemaster Prices Matter? An Examination of Acute Care Hospital Profitability
Sebastian Linde & Leonard Egede
Medical Care, August 2022, Pages 623-630
Design:
We use interactive fixed effects methods to address concerns of unobserved hospital-specific (time-invariant) confounders, and cross-sectional dependence.
Results:
Between 1996 and 2017, chargemaster markups increased (on average) by 155%, and the SD of the chargemaster markup distribution increased by 324%—indicating growing variability in the average markup strategies pursued by hospitals. Our preferred model specification implies that a unit increase of the hospital chargemaster markup is associated with a $261 (P<0.01; 95% confidence interval: $232–$291) increase in profits per hospital inpatient discharge. These results are robust to a wide set of model specifications, the use of alternative profitability measurements, and the use of an alternative instrumental variable identification strategy. Additional subsample analysis that controls for a rich set of hospital quality measures and system affiliation information also yields similar results.
The effect of health insurance status on treatment intensity in heart attack patients: An IV approach
Jason Beck
Applied Economics Letters, forthcoming
Abstract:
The purpose of this exercise is to determine if patients suffering from heart attacks receive different levels of treatment intensity based on insurance status, accounting for possible endogeneity between insurance status and treatment intensity. This possible endogeneity is addressed through an instrumental variables approach and results suggest that insurance status is not as impactful on treatment intensity once endogeneity is accounted for.
The Effects of Health Information Exchange Access on Healthcare Quality and Efficiency: An Empirical Investigation
Ramkumar Janakiraman et al.
Management Science, forthcoming
Abstract:
Health information exchanges (HIEs) are designed to improve the quality and efficiency of healthcare by facilitating improved information sharing between health entities. This study systematically examines the impact of HIE use in emergency departments (EDs) on the quality and efficiency of medical care. We focus on the length of stay (LOS) and the 30-day readmission rate to capture healthcare efficiency and quality, respectively. We also examine whether the breadth of patient health information and physicians’ experience with the HIE moderates these effects. We leverage a unique panel data that tracks actual HIE access by physicians who practice in a set of hospitals that participate in the focal HIE. The patient-level encounter data set—which involves more than 80,000 ED encounters attended by more than 300 physicians over a 19-month period—comprises detailed medical provider information, patient-level medical information, and various other information related to procedures that were performed. After controlling for a battery of patient-specific, physician-specific, disease-specific, and ED visit-specific variables, our results show that HIE access in information-intensive environments (such as EDs) reduces LOS and 30-day readmission rate. We find that breadth of patient health information and physicians’ HIE experience amplify these benefits. We account for endogeneity issues and perform additional falsification tests and robustness checks. We document that benefits of HIE access are amplified for noninjury, chronic condition, and uncommon diagnoses related patient visits. Based on our results, we offer insights to practitioners and academicians alike on how HIEs can yield better patient-level and provider-level outcomes.
The effects of occupational licensing reform for nurse practitioners on children's health
Moiz Bhai & David Mitchell
Southern Economic Journal, forthcoming
Abstract:
We examine how scope of practice reforms that allow nurse practitioners independent practice authority impact children's health. We exploit spatial and temporal variation in independent practice authority to implement a difference-in-differences research design using data from the first three waves of the National Survey of Children's Health. We find that these reforms have significant positive impacts on a commonly used and validated measure of children's health: parental evaluation of child health. As a result of this scope of practice reforms, parental evaluations of overall child health improve as parents increasingly rate their child as having Excellent Health. More importantly, we observe these improvements in health are driven primarily by older children and children from lower family income backgrounds. These findings indicate that an expansion in the supply of healthcare through occupational licensing reform can positively influence health outcomes for children. Such findings have important implications for mitigating child health inequality.
Phantom Networks: Discrepancies Between Reported And Realized Mental Health Care Access In Oregon Medicaid
Jane Zhu et al.
Health Affairs, July 2022, Pages 1013-1022
Abstract:
Understanding the extent to which beneficiaries can “realize” access to reported provider networks is imperative in mental health care, where there are significant unmet needs. We compared listings of providers in network directories against provider networks empirically constructed from administrative claims among members who were ages sixty-four and younger and enrolled in Oregon’s Medicaid managed care organizations between January 1 and December 31, 2018. “In-network” providers were those with any medical claims filed for at least five unique Medicaid beneficiaries enrolled in a given health plan. They included primary care providers, specialty mental health prescribers, and nonprescribing mental health clinicians. Overall, 58.2 percent of network directory listings were “phantom” providers who did not see Medicaid patients, including 67.4 percent of mental health prescribers, 59.0 percent of mental health nonprescribers, and 54.0 percent of primary care providers. Significant discrepancies between the providers listed in directories and those whom enrollees can access suggest that provider network monitoring and enforcement may fall short if based on directory information.
Effects of the Affordable Care Act Medicaid Expansion on the Compensation of New Primary Care Physicians
Yanlei Ma et al.
Medical Care, August 2022, Pages 636-644
Research Design:
We used a quasiexperimental difference-in-differences design to assess changes in compensation for new PCPs from before to after the Medicaid expansion in states that expanded Medicaid compared with states that did not expand.
Subjects:
Our study included 2003 new PCPs who responded to the Survey of Residents Completing Training in New York between 2009 and 2018.
Results:
We found that starting salaries for new PCPs, especially new general internists and family physicians, grew faster in expansion states than in nonexpansion states. In addition, we found that the expansion was associated with a statistically significant increase in receiving additional anticipated income as part of the compensation package for new PCPs practicing in rural areas.