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on Health Economics |
| By: | Michael P. Keane; Jonathan D. Ketcham; Nicolai V. Kuminoff; Timothy Neal |
| Abstract: | We propose new methods to model behavior and conduct welfare analysis in complex environments where some choices are unlikely to reveal preferences. We develop a mixture-of-experts model that incorporates heterogeneity in consumers’ preferences and in their choice processes. We also develop a method to decompose logit errors into latent preferences versus optimization errors. Applying these methods to Medicare beneficiaries’ prescription drug insurance choices suggests that: (1) average welfare losses from suboptimal choices are small, (2) beneficiaries with dementia and depression have larger losses, and (3) policies that simplify choice sets offer small average benefits, helping some people but harming others. |
| JEL: | C25 D9 I13 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25652&r=all |
| By: | Amanda E. Kowalski |
| Abstract: | I develop a model of a randomized experiment with a binary intervention and a binary outcome. Potential outcomes in the intervention and control groups give rise to four types of participants. Fixing ideas such that the outcome is mortality, some participants would live regardless, others would be saved, others would be killed, and others would die regardless. These potential outcome types are not observable. However, I use the model to develop estimators of the number of participants of each type. The model relies on the randomization within the experiment and on deductive reasoning. I apply the model to an important clinical trial, the PROWESS trial, and I perform a Monte Carlo simulation calibrated to estimates from the trial. The reduced form from the trial shows a reduction in mortality, which provided a rationale for FDA approval. However, I find that the intervention killed two participants for every three it saved. |
| JEL: | C1 H0 I1 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25670&r=all |
| By: | Timothy K.M. Beatty; Marianne P. Bitler; Xinzhe Huang Cheng; Cynthia van der Werf |
| Abstract: | It is well documented that individuals do not spend SNAP benefits smoothly over the month after receipt. Rather, recipients spend a disproportionate share of benefits at the beginning of the benefit month. This has costs for recipients and stores. There is also evidence that other income streams, such as Social Security and paychecks, are not spent smoothly. The presence of these other income streams may bias estimates of the effects of this SNAP cycle on consumption for working SNAP beneficiaries and those who receive other government benefits. We use data from USDA’s National Household Food Acquisition and Purchase Survey to explore how the SNAP cycle is affected by accounting for these other income streams. We find suggestive evidence that the cycle is more pronounced for workers who are paid on a weekly or monthly basis, but little evidence that cycles in other income streams mitigate or exacerbate the SNAP cycle. |
| JEL: | H53 I38 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25635&r=all |
| By: | Youssef Benzarti; Jarkko Harju; Tuomas Matikka |
| Abstract: | This paper estimates the effect of relaxing the social insurance mandate on entrepreneurial activity. We use a unique discontinuity in Finland that allows certain entrepreneurs not to pay social insurance contributions on their income. Using rich administrative data, we find that relaxing the social insurance mandate leads entrepreneurs to significantly reduce their contributions, which they channel instead into their firms. While young firms use this windfall to increase business activity, older ones use it to improve their net lending position by purchasing stocks. Our results imply that the social insurance mandate is binding and its efficiency cost is heterogeneous. |
| JEL: | H25 H32 H55 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25651&r=all |
| By: | Clay, Karen (Carnegie Mellon University); Portnykh, Margarita (Carnegie Mellon University); Severnini, Edson R. (Carnegie Mellon University) |
| Abstract: | Surface soil contamination has been long recognized as an important pathway of human lead exposure, and is now a worldwide health concern. This study estimates the causal effects of exposure to lead in topsoil on cognitive ability among 5-year-old children. We draw on individual level data from the 2000 U.S. Census, and USGS data on lead in topsoil covering a broad set of counties across the United States. Using an instrumental variable approach relying on the 1944 Interstate Highway System Plan, we find that higher lead in topsoil increases considerably the probability of 5-year-old boys experiencing cognitive difficulties such as learning, remembering, concentrating, or making decisions. Living in counties with topsoil lead concentration above the national median roughly doubles the probability of 5-year-old boys having cognitive difficulties. Nevertheless, it does not seem to affect 5-year-old girls, consistent with previous studies. Importantly, the adverse effects of lead exposure on boys are found even in counties with levels of topsoil lead concentration considered low by the guidelines from the U.S. EPA and state agencies. These findings are concerning because they suggest that legacy lead may continue to impair cognition today, both in the United States and in other countries that have considerable lead deposition in topsoil. |
| Keywords: | legacy lead in soil, cognition, pre-school children |
| JEL: | N52 Q53 Q56 R11 I15 I18 I25 I28 |
| Date: | 2019–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12178&r=all |
| By: | Elham Erfanian (Regional Research Institute, West Virginia University); Alan R. Collins (Division of Resource Economics and Management, West Virginia University) |
| Abstract: | According to the World Health Organization, 235 million people around the world currently suffer from asthma, which includes approximately 25 million in the United States. There is substantial epidemiological evidence indicating linkages between outdoor air pollution and asthma symptoms, more specifically between concentrations of particulate matter and asthma. Using county level data for 2001-2014, a spatial panel framework is imposed based upon prevailing wind patterns to investigate the direct and indirect impacts of PM2.5 concentration levels on asthma hospitalization in Pennsylvania. This model controls for population density, precipitation, smoking rate, and population demographic variables. Results show that PM2.5 concentrations as measured at the county level have positive direct and indirect effects on asthma hospitalization. A one-unit increase in PM2.5 in one Pennsylvania county will add, on average $1.29M ($754,656 direct and $539,040 indirect) to total annual asthma hospitalization costs with the state of Pennsylvania. This study highlights the need for realistic and accurate impact analyses of ambient air pollution on asthma that reflects the impacts on neighboring regions as well. In order to capture the spillover effects of health-related impacts from PM2.5 pollution, a wind direction algorithm to identify appropriate neighbors is important. |
| Keywords: | PM2.5 concentrations, Asthma, Spatial econometrics, Wind pattern weight matrix, Spillover effects |
| JEL: | Q53 I18 Q40 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:rri:wpaper:2019wp01&r=all |
| By: | Garas, Antonios; Guthmuller, Sophie; Lapatinas, Athanasios |
| Abstract: | Using the economic complexity methodology on data for disease prevalence in 195 countries during the period of 1990-2016, we propose two new metrics for quantifying the relatedness between diseases, or the ‘disease space’ of countries. With these metrics, we analyze the geography of diseases and empirically investigate the effect of economic development on the health complexity of countries. We show that a higher income per capita increases the complexity of countries’ diseases. Furthermore, we build a disease-level index that links a disease to the average level of GDP per capita of the countries that have prevalent cases of the disease. With this index, we highlight the link between economic development and the complexity of diseases and illustrate, at the disease-level, how increases in income per capita are associated with more complex diseases. |
| Keywords: | health complexity, disease complexity, economic development |
| JEL: | C1 I1 I15 |
| Date: | 2019–03–18 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:92831&r=all |
| By: | Andrea M. Kelly; Jason M. Lindo; Analisa Packham |
| Abstract: | We estimate the effect of Colorado's Family Planning Initiative, the largest program to have focused on long-acting-reversible contraceptives in the United States, which provided funds to Title X clinics so that they could make these contraceptives available to low-income women. We find substantial effects on birth rates, concentrated among women in zip codes within 7 miles of clinics: the initiative reduced births by approximately 20 percent for 15-17 year olds and 18-19 year olds living in such zip codes. We also examine how extensive media coverage of the initiative in 2014 and 2015 altered its reach. After information spread about the availability and benefits of LARCs, we find a substantial increase in LARC insertions, extended effects on births among 15-17 year olds living greater than 7 miles from clinics, and significant reductions in births among 20–24 and 25–29 year olds. |
| JEL: | I18 J13 J18 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25656&r=all |
| By: | Helen Levy (University of Michigan); Thomas Buchmueller (University of Michigan); Sayeh Nikpay (Vanderbilt University Medical Center) |
| Abstract: | We analyze whether the Affordable Care Act (ACA) has affected labor supply of older Americans using data that span more than four years after the policy’s implementation in 2014. We find no changes in labor supply of older Americans either in response to subsidized marketplace coverage, which became available nationally in 2014, or in response to the expansion of Medicaid eligibility in some states but not others. We analyze multiple dimensions of labor supply — labor force participation; employment; full-time work conditional on employment — as well as several measures of retirement including self-reported retirement and the receipt of retirement income. We fail to find labor supply effects even for subgroups with less than a high school education or those with fair or poor health, who might have been expected to have a greater labor supply response. The lack of a labor supply response stands in contrast to the large gains in coverage observed in 2014. These results suggest that for Americans approaching retirement the Affordable Care Act achieved its primary goal of increasing coverage without the unintended consequence of reducing labor supply. |
| Date: | 2018–09 |
| URL: | http://d.repec.org/n?u=RePEc:mrr:papers:wp393&r=all |
| By: | Abrahamsen, Signe A. (University of Bergen, Department of Economics); Grøtting, Maja Weemes (Norwegian Social Research, Oslo Metropolitan University) |
| Abstract: | Health-care expenditures and the demand for caregiving are increasing concerns for policy makers. Although informal care to a certain extent may substitute for costly formal care, providing informal care may come at a cost to caregivers in terms of their own health. However, evidence of causal effects of care responsibilities on health is limited, especially for long-term outcomes. In this paper, we estimate long-term effects of a formal care expansion for the elderly on the health of their middle-aged daughters. We exploit a reform in the federal funding of formal care for Norwegian municipalities that caused a greater expansion of home care provision in municipalities that initially had lower coverage rates. We find that expanding formal care reduced sickness absence in the short run, primarily due to reduced absences related to musculoskeletal and psychological disorders. In general, we find no effects on long-term health outcomes. |
| Keywords: | Formal and informal eldercare; sickness absence; health |
| JEL: | I10 J14 J22 J38 |
| Date: | 2019–01–25 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:bergec:2019_002&r=all |
| By: | Manuel Hoffmann; Roberto Mosquera; Adrian Chadi |
| Abstract: | Influenza imposes substantial costs worldwide in terms of human lives and productivity losses. Vaccination could be a cost-effective way to reduce these costs for firms and public health institutions, but low take-up rates, particularly of working adults, and vaccination unintendingly causing moral hazard may decrease its benefits. We ran a natural field experiment in cooperation with a major bank in Ecuador where we modified a company-wide vaccination campaign. Experimentally manipulating incentives to participate in this health intervention allows us to study peer effects with organizational data and to determine the personal consequences of being randomly encouraged to take part in the campaign. We find that assigning employees to get vaccinated during the workweek increased take-up by 112% compared to employees assigned to the weekend, which indicates that reducing opportunity costs plays an important role to increase vaccination rates. Peer take-up also increased individual take-up significantly. Contrary to the company's expectations, we find that the effect of vaccination on health outcomes is a precise zero with no measurable health externalities from coworkers. Using a dataset of administrative records on sickness diagnoses and employee surveys, we find evidence consistent with vaccination causing moral hazard, which could decrease the effectiveness of vaccination. |
| Keywords: | Health Intervention, Flu Vaccination, Sickness-Related Absence, Field Experiment, Random Encouragement Design, Moral Hazard, Technology Adoption |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:twi:respas:0116&r=all |
| By: | Claudio Deiana (Università di Cagliari and University of Essex); Ludovica Giua (European Commission, DG Joint Research Centre, Unit I.1, Monitoring, Indicators & Impact Evaluation, Competence Centre on Microeconomic Evaluation (CC-ME)); Roberto Nisticò (Università di Napoli Federico II and CSEF) |
| Abstract: | We investigate the effect of fluctuations in the price of opium in Afghanistan on the per capita quantity of prescription opioids dispensed across US counties during the 2003-2016 period. We show that reductions in opium prices significantly increase the amount of prescription opioids. Most of the increase concerns natural and semi-synthetic opioids, not fully-synthetic opioids. Moreover, opium price fluctuations affect the rate of opioid-related deaths. Finally, our firm-level analysis reveals that opioids-producing companies stock prices react significantly to opium price shocks. Overall, our findings suggest that supply-side economic incentives have played a crucial role in the current US opioid epidemic. |
| Keywords: | Prescription Opioids, Drugs, Opium Price, Supply-Side Economic Incentives. |
| JEL: | I11 I12 I18 L65 |
| Date: | 2018–03–15 |
| URL: | http://d.repec.org/n?u=RePEc:sef:csefwp:525&r=all |
| By: | Ylenia Brilli (Department of Economics (University of Verona)); BRANDON J. RESTREPO (Economic Research Service, U.S. Department of Agriculture (USDA)) |
| Abstract: | This study demonstrates that rule-of-thumb health treatment decision-making exists when assigning medical care to macrosomic newborns with an extremely high birth weight and estimates the short-run health return to neonatal care for infants at the high end of the birth weight distribution. Using a regression discontinuity design, we find that infants born with a birth weight above 5000 grams have a 2 percentage-point higher probability of admission to a neonatal intensive care unit and a 1 percentage-point higher probability of antibiotics receipt, compared to infants with a birth weight below 5000 grams. We also find that being born above the 5000-gram cutoff has a mortality-reducing effect: infants with a birth weight larger than 5000 grams face a 0.2 percentage points lower risk of mortality in the first month, compared to their counterparts with a birth weight below 5000 grams. We do not find any evidence of changes in health treatments and mortality at macrosomic cutoffs lower than 5000 grams, which is consistent with the idea that such treatment decisions are guided by the higher expected morbidity and mortality risk associated with infants weighing more than 5000 grams. |
| Keywords: | Birth Weight, Health Care, Medical Inputs, Infants, Mortality |
| JEL: | I11 I18 J13 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:ver:wpaper:01/2019&r=all |
| By: | Cristina Belles-Obrero; Antonio Cabrales; Sergi Jimenez-Martin; Judit Vall-Castello |
| Abstract: | We explore the effects of a child labor regulation that changed the legal working age from 14 to 16 over the health of their offspring. We show that the reform was detrimental for the health of the son's of affected parents at delivery. Yet, in the medium run, the effects of the reform are insignificant for both male and female children. The sons of treated mothers are perceived as still having worse health at older ages, even if their objective health status has recovered. These boys are also more likely to have private health insurance, which suggests more concerned mothers. |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:fda:fdaddt:2019-02&r=all |
| By: | Hernandez-Villafuerte, K.; Zamora, B.; Feng, Y.; Parkin, D.; Devlin, N.; Towse, A. |
| Abstract: | Estimating a cost-effectiveness threshold reflecting the opportunity cost of adopting a new technology in a health system is not easy. This OHE research paper provides empirical evidence on the relationship between health outcomes and health expenditures in England. Results suggest that setting a cost-effectiveness criterion for NICE may not be capable of being synthesised using scientific methods alone, but involve political judgements. Two methods are used to explore the marginal relationship between health expenditure and health outcomes - Data Envelopment Analysis (DEA) and Quantile Regression (QR). DEA allows the incorporation of multiple outcomes (not just mortality) and the measurement of efficiency and scale elasticity, while QR allows us to look for non-linearities in the relationship between spending and mortality. DEA was applied to health outcomes and health expenditure data from 151 Primary Care Trusts (PCTs) (now Clinical Commissioning Groups) in England across seven clinical areas termed Programme Budget Categories (PBCs). Two environmental variables were selected (the deprivation index and budget shortfalls against formula) to adjust for factors affecting efficiency that were outside of the control of PCT managers. The QR method was applied to estimate the mortality rate as a function of health expenditure and a set of covariates using data from 151 PCTs in England across six of the PBCs. The method recognises the non-negative, highly asymmetric and leptokurtic distribution of health expenditure. Point estimates of the mortality elasticity to health expenditure are compared at different parts of the mortality distribution. Finally, we compare the ranking of PCTs according to the DEA efficiency scores and the outcome elasticities estimated in the QR approach. Results from DEA show that efficiency varies across PCTs and PBCs. PCTs achieve a range of health outcomes which cannot be adequately explained by concentrating on reductions in the mortality rate. The results from QR analysis provide evidence of heterogeneity across PCTs and PBCs regarding the way health resources are used to improve outcomes. The results suggest that the marginal effect of health expenditure on the mortality rate is not constant across PCTs and PBCs. The comparison of PCT rankings from the DEA and QR analyses are consistent and robust. In general, efficient PCTs (based on the DEA results) tend to have a lower absolute value of mortality elasticity to health expenditure (based on the QR results). A plausible explanation for these results is that PCTs operating efficiently in a PBC tend to have lower rates of mortality, and for most disease areas, the lower the mortality, the harder it is to achieve additional reductions. Estimation of an opportunity cost-based cost-effectiveness threshold using a health production function approach involves many assumptions about the behaviour of the implied function. These are compounded by the nature of the programme budgeting data that are used for estimation. This study uncovers further problems with assumptions that may underpin attempts to obtain a simple singular system-wide threshold estimate. This study provides empirical evidence of production inefficiency, that is the inability of some PCTs to achieve the best practice performance found in others. This means that estimates of the opportunity cost of introducing new technologies based on average performance could be (i) biased and (ii) subject to far greater variation than normally assumed. Moreover, the PCTs found to be inefficient vary between PBCs, confounding further the plausibility of estimates based on averages. There is evidence for some PBCs that some apparent inefficiencies result from adoption of a different underlying production function technology, casting further doubts on the assumption of a common production function for all, that underlies a common threshold. One way to approach this problem is to accept that there are multiple sources of information relevant to the setting of cost-effectiveness criteria to be used across the NHS and that these may not be capable of being synthesised using scientific methods alone. The research was funded by the Association of the British Pharmaceutical Industry (ABPI). |
| Keywords: | Judging value for money and improving decision making |
| JEL: | I1 |
| Date: | 2019–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:ohe:respap:002142&r=all |
| By: | Sampson, C.; Garau, M. |
| Abstract: | The measurement of quality of life in the context of spinal muscular atrophy (SMA) is challenging. This is because the disease is experienced by children and is rare, which makes data collection difficult. This Briefing reports on a symposium that outlined some lessons that can be learnt from the SMA context that might be more widely applicable. Where evidence is lacking for new treatments, because of practical or methodological difficulties, there is a risk that patients remain unable to access cost-effective care. We identify a variety of ways in which current approaches to the measurement of quality of life in SMA may be inadequate. For example, it is unlikely that existing measures of health-related quality of life capture all that is important to patients and caregivers. Based on the discussion, we highlight four possible strategies for improving the quantity and quality of data available to inform decisionmakers in the context of rare diseases - - Bespoke data collection which is relevant to HTA decisionmakers; - Simple economic modelling methods, which reflect the evidence available at thetime of the assessment; - Collaboration among the different parties involved; and - Identifying what is 'good enough' to inform decisionmaking on use at the time oflaunch or of the health technology assessment process. New approaches to research could facilitate health technology assessment processes and improve patients' access to cost-effective treatments for rare diseases. |
| Keywords: | Measuring and valuing outcomes |
| JEL: | I1 |
| Date: | 2019–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:ohe:briefg:002146&r=all |
| By: | Clay, Karen (Carnegie Mellon University); Lewis, Joshua (University of Montreal); Severnini, Edson R. (Carnegie Mellon University) |
| Abstract: | Disparities in cross-city pandemic severity during the 1918 Influenza Pandemic remain poorly understood. This paper uses newly assembled historical data on annual mortality across 438 U.S. cities to explore the determinants of pandemic mortality. We assess the role of three broad factors: i) pre-pandemic population health and poverty, ii) air pollution, and iii) the timing of onset and proximity to military bases. Using regression analysis, we find that cities in the top tercile of the distribution of pre-pandemic infant mortality had 21 excess deaths per 10,000 residents in 1918 relative to cities in the bottom tercile. Similarly, cities in the top tercile of the distribution of proportion of illiterate residents had 21.3 excess deaths per 10,000 residents during the pandemic relative to cities in the bottom tercile. Cities in the top tercile of the distribution of coal-fired electricity generating capacity, an important source of urban air pollution, had 9.1 excess deaths per 10,000 residents in 1918 relative to cities in the bottom tercile. There was no statistically significant relationship between excess mortality and city proximity to World War I bases or the timing of onset. Together the three statistically significant factors accounted for 50 percent of cross-city variation in excess mortality in 1918. |
| Keywords: | influenza, pandemic, mortality, air pollution |
| JEL: | N32 N52 N72 Q40 Q53 O13 |
| Date: | 2019–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12177&r=all |
| By: | Julia Cage (Département d'économie); Valeria Rueda |
| Abstract: | This article investigates the long-term historical impact of missionary activity on the prevalence of HIV/AIDS in sub-Saharan Africa. On the one hand, missionaries were among the first to invest in modern medicine in a number of countries. On the other hand, Christianity influenced sexual beliefs and behaviors. We build a new geocoded dataset locating Protestant and Catholic missions in the early 20th century, as well as their health investments. Using a number of different empirical strategies to address selection in missionary locations and into health investments, we show that missionary presence has conflicting effects on HIV today. Regions close to historical mission stations exhibit higher HIV prevalence. This negative impact is robust to multiple specifications accounting for urbanization, and we provide evidence that it is specific to STDs. Less knowledge about condom use is a likely channel. On the contrary, among regions historically close to missionary settlements, proximity to a mission with a health investment is associated with lower HIV prevalence nowadays. Safer sexual behaviors around these missions are a possible explanatory channel. |
| Keywords: | Historical persistence; Missions; Health investments; HIV/AIDS; Sexual behavior |
| JEL: | D72 N37 N77 O33 Z12 Z13 |
| Date: | 2019–02 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/76npisrda99aop75h6fmi4vduu&r=all |
| By: | Haseeb Ahmed; Benjamin W. Cowan |
| Abstract: | This paper uses a difference-in-difference framework to estimate the effects of mobile money transfer technology (MMT) on healthcare usage in the face of negative health shocks. We use survey data from 2013-16 with quarterly observations on about 1,600 households of 10 villages in the Kisumu region of Western Kenya. We find evidence that MMT, likely through greater ease of informal borrowing, helps households increase utilization of formal healthcare services in terms of visits to a clinic, consultation and medication expenditures in comparison with the non-users of this technology. |
| JEL: | I13 I15 O55 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25669&r=all |
| By: | Johannes Haushofer; Charlotte Ringdal; Jeremy P. Shapiro; Xiao Yu Wang |
| Abstract: | We study the impact of randomized unconditional cash transfers to both men and women on intimate partner violence in Kenya. Transfers to women averaging USD 709 reduced physical and sexual violence (–0.26, –0.22 standard deviations). Transfers to men reduced only physical violence (–0.18 SD). We find evidence of spillovers: physical violence towards non-recipient women in treatment villages decreased (–0.16 SD). We show theoretically that transfers to both men and women are needed to understand why violence occurs. Our theory suggests that husbands use physical violence to extract resources, but dislike it, while the converse may be true for sexual violence. |
| JEL: | C93 D13 O12 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25627&r=all |