Paying for Bodies
In-Kind Welfare Benefits and Reincarceration Risk: Evidence from Medicaid
Marguerite Burns & Laura Dague
NBER Working Paper, June 2023
Abstract:
Most of the 600,000 adults returning to the community from state and federal prisons annually in the U.S. carry substantial debt, have low income and low education, and limited formal employment prior to entering prison. Upon reentry, they face financial hardship, high rates of morbidity and mortality, and high incidence of re-offense. Medicaid coverage, as a means-tested transfer program providing subsidized health insurance, may influence reincarceration through both financial and health channels. In this paper, we provide a comprehensive look at the effects of public health insurance coverage on post-release behavior of formerly incarcerated adults. We study a natural experiment in which two separate state policy changes resulted in a 60 percentage point increase in Medicaid enrollment at release. Using a series of linked individual level administrative datasets, we estimate the effects of this change in Medicaid enrollment, finding declines in reincarceration, increased employment, and higher health care use. Leveraging data on financial concerns and need for mental health and substance use treatment to examine mechanisms, we find support for a financial channel and mixed support for health channels. Policies that enhance access to healthcare and provide financial security for this population may have significant benefits for individuals and society.
Nonprofit Hospitals: Profits And Cash Reserves Grow, Charity Care Does Not
Derek Jenkins & Vivian Ho
Health Affairs, June 2023, Pages 866-869
Abstract:
Using the National Academy of State Health Policy Hospital Cost Tool, we compared changes in hospital profits with changes in hospitals' charity care and cash reserves between 2012 and 2019. We estimated substantial growth in nonprofit hospital operating profits and cash reserves in this period but no corresponding increase in charity care.
Bad medicine: Litigation, competition, and the marketing of prescription opioids
David Tan & Nicole West
Strategic Management Journal, forthcoming
Abstract:
How do competitors respond when a firm experiences an increased threat of penalties for questionable business activities? While conventional wisdom suggests that competitors will attempt to avoid similar activities, we draw attention to a countervailing incentive. If an increased threat of penalties induces one firm to reduce its engagement in an activity, competitors in an industry may see an opportunity to profit by increasing their engagement in the activity. We explain how this is theoretically possible even if competitors also experience an increased threat of penalties. As an empirical example, we show that following a lawsuit against Purdue Pharma, Purdue significantly decreased its spending to promote OxyContin, but other prescription opioid firms significantly increased their spending to promote competing opioids to the same physicians.
Resting on Their Laureates? Research Productivity Among Winners of the Nobel Prize in Physiology or Medicine
Jay Bhattacharya et al.
NBER Working Paper, June 2023
Abstract:
The Nobel Prize in Physiology or Medicine is the most prestigious and coveted award in medical research. Anecdotal evidence and related research suggest that receiving it may adversely affect research productivity. We compared the post-Nobel research output of laureates (prize years: 1950-2010) with their pre-Nobel output and with the output of a matched control group consisting of winners of the Lasker Award, another highly prestigious medical research prize. Pre-Nobel, laureates' publications were more voluminous, highly cited, and novel than those of (future) Lasker winners. Post-Nobel, laureates' productivity decreased sharply, eventually falling below that of Lasker winners on all three measures. These declines may reflect diversionary effects of the Prize, changed incentives, or intrinsically different career arcs for medical researchers who win the Nobel Prize.
Association of Surgical Resident Competency Ratings With Patient Outcomes
Daniel Kendrick et al.
Academic Medicine, July 2023, Pages 813-820
Method: A retrospective, cross-sectional study was conducted using a sample of national Medicare claims for 23 common, high-risk inpatient general surgical procedures performed between July 1, 2015, and November 30, 2018 (n = 12,400 cases) by nonfellowship-trained U.S. general surgeons. Milestone ratings collected during those surgeons' last year of residency (n = 701 residents) were compared with their risk-adjusted rates of mortality, any complication, or severe complication within 30 days of index operation during their first 2 years of practice.
Results: There were no associations between mean milestone competency ratings of graduating general surgery residents and their subsequent early career patient outcomes, including any complication (23% proficient vs 22% not yet proficient; relative risk [RR], 0.97, [95% CI, 0.88-1.08]); severe complication (9% vs 9%, respectively; RR, 1.01, [95% CI, 0.86-1.19]); and mortality (5% vs 5%; RR, 1.07, [95% CI, 0.88-1.30]). Secondary analyses yielded no associations between patient outcomes and milestone ratings specific to technical performance, or between patient outcomes and composites of operative performance, professionalism, or leadership milestones ratings (P ranged .32-.97).
Direct and Spillover Effects of Quality Disclosure Regulation: Evidence from California Hospitals
Aishwarrya Deore, Martin Holzhacker & Ranjani Krishnan
Management Science, forthcoming
Abstract:
Quality disclosures regarding medical outcomes such as patient mortality are common healthcare policy instruments. Mixed evidence exists on whether quality disclosures improve outcomes for disclosed ailments. Moreover, disclosure policies can generate spillovers and impact ailments not targeted by the policy. We examine the effects of quality disclosure regulation on mortality improvements in disclosed and nondisclosed ailments. We use patient records for California hospitals for 1995-2014 and construct three groups of ailments: those that were the target of disclosure regulation, complementary ailments that were not the target of disclosure regulation but are medically related to the disclosed ailments, and medically unrelated ailments. Using a difference-in-differences design, we find that quality disclosure regulation is associated with declines in mortality risk of disclosed ailments ranging from 11.5% to 23%. Quality disclosure regulation is also associated with improvements for complementary ailments that are not the target of the disclosure policy. Such positive spillover effects yield an estimated 15.2% decline in mortality risk. Consistent with demand-side pressures driving improvements, market shares become sensitive to disclosed quality measures after disclosure regulation. Our findings of direct and spillover effects have implications for disclosure regulation.
Gaming and Effort in Performance Pay
Luca Bertuzzi et al.
NBER Working Paper, June 2023
Abstract:
Health insurers often tie payments to providers' quality of care. Although payers do this to elicit more effort from providers, some providers may game the system by avoiding patients who would cause their quality scores to fall. We use annual variation in the criteria for Medicare's Quality Incentive Program in dialysis to distinguish strategic patient dropping from higher-quality care. Patients who would reduce their facilities' scores are 14.3-71.5% more likely to switch facilities, often to ones that suggest the move was involuntary, while under certain conditions facilities exert more effort to improve their scores by providing better care.
Rapid Enrollment Growth In 'Look-Alike' Dual-Eligible Special Needs Plans: A Threat To Integrated Care
Yanlei Ma et al.
Health Affairs, July 2023, Pages 919-927
Abstract:
Policy makers are increasingly investing in efforts to better integrate Medicare and Medicaid services for people who are eligible for both programs, including expanding Dual-Eligible Special Needs Plans (D-SNPs). In recent years, however, a potential threat to integration has emerged in the form of D-SNP "look-alike" plans, which are conventional Medicare Advantage plans that are marketed toward and primarily enroll dual eligibles but are not subject to federal regulations requiring integrated Medicaid services. To date, limited evidence exists documenting national enrollment trends in look-alike plans or the characteristics of dual eligibles in these plans. We found that look-alike plans experienced rapid enrollment growth among dual eligibles during the period 2013-20, increasing from 20,900 dual eligibles across four states to 220,860 dual eligibles across seventeen states, for an elevenfold increase. Nearly one-third of dual eligibles in look-alike plans were previously in integrated care programs. Compared with D-SNPs, look-alike plans were more likely to enroll dual eligibles who were older, Hispanic, and from disadvantaged communities. Our findings suggest that look-alike plans have the potential to compromise national efforts to integrate care delivery for dual eligibles, including vulnerable subgroups who may benefit the most from integrated coverage.
What Difference Does a Health Plan Make? Evidence from Random Plan Assignment in Medicaid
Michael Geruso, Timothy Layton & Jacob Wallace American Economic Journal:
Applied Economics, July 2023, Pages 341-379
Abstract:
Exploiting the random assignment of Medicaid beneficiaries to managed care plans, we find substantial plan-specific spending effects despite plans having identical cost sharing. Enrollment in the lowest-spending plan reduces spending by at least 25 percent -- primarily through quantity reductions -- relative to enrollment in the highest-spending plan. Rather than reducing "wasteful" spending, lower-spending plans broadly reduce medical service provision -- including the provision of low-cost, high-value care -- and worsen beneficiary satisfaction and health. Consumer demand follows spending: a 10 percent increase in plan-specific spending is associated with a 40 percent increase in market share. These facts have implications for the government's contracting problem and program cost growth.
The Impact of the Affordable Care Act Insurance Expansions on Opioid-Related Emergency Department Visits
Sandra Decker et al.
American Journal of Health Economics, forthcoming
Abstract:
Amid rising opioid-related deaths and hospital use, the 2010 Patient Protection and Affordable Care Act (ACA) was signed into law, with the central coverage provisions implemented in 2014. We leverage these ACA coverage expansions (including Medicaid expansion and Marketplaces) to study the impact of health insurance on opioid-related emergency department (ED) visits while accounting for potentially confounding changes in relevant state-level policies. We use zip code-level ED utilization data from the 2010-18 Healthcare Cost and Utilization Project (HCUP) State Inpatient Databases (SID) and State Emergency Department Databases (SEDD) for 29 states. In difference-in-difference-in-differences (DDD) models that compared low- and high-uninsurance areas within states, we found evidence of a dose-response relationship between pre-ACA uninsurance and changes in ED visit rates in both expansion and non-expansion states: areas with higher uninsurance rates prior to the ACA saw larger reductions in opioid-related ED visits after the ACA took effect. Effects were also time-varying, with no significant dose-response relationship emerging until the third year of ACA implementation. These estimates suggest that increasing insurance coverage among the uninsured may help mitigate harms of the opioid crisis.
Psychiatrist Networks In Medicare Advantage Plans Are Substantially Narrower Than In Medicaid And ACA Markets
Jane Zhu et al.
Health Affairs, July 2023, Pages 909-918
Abstract:
Medicare Advantage now covers twenty-eight million older adults, many of whom have mental health needs. Enrollees are often restricted to providers who participate in a health plan's network, which may present a barrier to care. We used a novel data set linking network service areas, plans, and providers to compare psychiatrist network breadth -- the percentage of providers in a given area that are considered "in network" for a plan -- across Medicare Advantage, Medicaid managed care, and Affordable Care Act plan markets. We found that nearly two-thirds of psychiatrist networks in Medicare Advantage were narrow (that is, they contained fewer than 25 percent of providers in a network's service area) compared with approximately 40 percent in Medicaid managed care and Affordable Care Act plan markets. We did not observe similar differences in network breadth for primary care physicians or other physician specialists across markets. Amid efforts to strengthen network adequacy, our findings suggest that psychiatrist networks in Medicare Advantage are particularly narrow, which may disadvantage enrollees as they attempt to obtain mental health services.