• Reading list

    Some very good papers in this group, including some at the end of the list. Scan all the way down. Check the titles. You’ll see what I mean.

    [book] Putting Medicare Consumers in Charge: Lesson from the FEHBP, by Walton Francis. From the publisher’s website:

    Until a recent government decision to place it in the same tax-preferred status as most private-insurer health insurance, the FEHBP consistently outperformed Medicare in cost control; it still outperforms Medicare in service, benefit generosity, fraud prevention, and protection from catastrophically high health care expenses. In this timely volume, Walton Francis analyzes the successes and failures of both programs and proposes reforms that will revive the FEHBP and improve Medicare.

    Does competition from ambulatory surgical centers affect hospital surgical output? by Charles Courtemanchea and Michael Plotzke

    This paper estimates the effect of ambulatory surgical centers (ASCs) on hospital surgical volume using hospital and year fixed effects models with several robustness checks. We show that ASC entry only appears to influence a hospital’s outpatient surgical volume if the facilities are within a few miles of each other. Even then, the average reduction in hospital volume is only 2–4%, which is not nearly large enough to offset the new procedures performed by an entering ASC. The effect is, however, stronger for large ASCs and the first ASCs to enter a market. Additionally, we find no evidence that entering ASCs reduce a hospital’s inpatient surgical volume.

    State Reform Dominates Boston Health Care Market Dynamics, by Ha T. Tu, Marisa K. Dowling, Laurie E. Felland, Paul B. Ginsburg, Ralph C. Mayrell

    Massachusetts’ 2006 landmark health reform law has reverberated throughout the Boston health care market as providers, insurers, employers and consumers adjust and adapt to a post-reform world of nearly universal health insurance coverage. Political support for health reform has remained strong and broad-based, but reform opponents are more vocal—especially small employers whose premiums have increased substantially since the merger of the small group and individual health insurance markets. Statewide, uninsurance rates dropped to 2.7 percent in 2009, down from 8.2 percent in 2006 before passage of the law that included an individual mandate for most adults to gain health coverage and new requirements for employers. The recession, which started later and was not quite as severe in Boston compared to many other metropolitan areas, has had little impact on the insurance coverage expansions gained through reform.

    With state policy makers deferring hard decisions in the reform law about slowing the growth of health care spending, costs have continued to increase rapidly, fueled in part by the ability of Boston’s renowned academic medical centers (AMCs) to command higher prices and attract more patients from community hospitals.

    State regulators and health plans have been embroiled in disputes over proposed rate increases for the small group market, even though the major plans faced operating losses as medical costs continued to increase.

    The fabric of Boston’s traditionally strong health care safety net is changing with most community health centers (CHCs) benefiting from coverage expansions and safety net hospitals struggling financially as the state shifts uncompensated care funding toward insurance subsidies to expand coverage.

    What factors influence seniors’ desire for choice among health insurance options? Survey results on the Medicare prescription drug benefit, by Thomas Rice, Yaniv Hanoch and Janet Cummings

    Questions about the design of the new US Medicare prescription drug benefit were raised even before its passage, where one of the most heated issues has been the number of plans offered to beneficiaries. Whether beneficiaries believe that there should be extensive or limited choice is still an open question. To study this issue, we analyzed data from the Kaiser Family Foundation/Harvard School of Public Health Survey, which included 718 individuals aged 65 years and above. The survey asked these older adults (i) whether they prefer having dozens of plans or for Medicare to offer a restricted number of plans and (ii) whether they think there are too many, too few or the right amount of plans. Our findings show that the majority of beneficiaries (69%) preferred that Medicare offer a limited number of options while only 29% wanted to see dozens of plans on the market. We also examine the effect of education level, income, political affiliation, race and health status on the desire for more or fewer plans. One surprising finding is that seniors with higher education appear to prefer fewer, not more, plan choices. Overall, our results question the merit of offering so many prescription drugs plan choices to Medicare beneficiaries.

    Hospital prices and market structure in the hospital and insurance industries, by Asako S. Moriya, William B. Vogt and Martin Gaynor

    There has been substantial consolidation among health insurers and hospitals, recently, raising questions about the effects of this consolidation on the exercise of market power. We analyze the relationship between insurer and hospital market concentration and the prices of hospital services. We use a national US dataset containing transaction prices for health care services for over 11 million privately insured Americans. Using three years of panel data, we estimate how insurer and hospital market concentration are related to hospital prices, while controlling for unobserved market effects. We find that increases in insurance market concentration are significantly associated with decreases in hospital prices, whereas increases in hospital concentration are non-significantly associated with increases in prices. A hypothetical merger between two of five equally sized insurers is estimated to decrease hospital prices by 6.7%.

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