Providing Health
Non-Profit Hospital Governance, Conduct, and CEO Pay
Daniel Kessler & William Wygal
NBER Working Paper, December 2024
Abstract:
We investigate whether two characteristics of non-profit hospital boards -- the number of board members and whether the CEO is a board member -- are associated with CEO pay and several measures of hospital performance, including price, operating margin, quality, and service to low-income patients. Although the consequences of CEO board membership for for-profit firms have been studied extensively, the consequences for non-profits in general, and non-profit hospitals in particular, have received little attention. Because most hospitals are non-profit and non-profit hospital prices have increased rapidly over the past 20 years, this gap is important. We find a strong positive association between CEO board membership and non-profit hospital prices, operating margins, and CEO pay, with a weaker positive (negative) association between CEO board membership and quality (service to low-income patients). We conclude that CEO board membership contributes to the fundamental agency problem between non-profit hospitals' management and the hospitals' intended beneficiaries, consistent with the concerns expressed by Fama and Jensen (1983).
Veterans May Be Seeing Lower-Quality Clinicians In The VHA Community Care Network
Yanlei Ma et al.
Health Affairs, January 2025, Pages 117-125
Abstract:
With the rapid expansion of veterans' access to community care under the Veterans Affairs Maintaining Internal Systems and Strengthening Integrated Outside Networks (VA MISSION) Act of 2018, ensuring that veterans receive high-quality community care has become a national priority. Using Veterans Health Administration (VHA) data and Medicare performance scores, we assessed how clinicians' performance on quality measures differed between those who treated veterans within the VHA Community Care Network and those who did not. We found that in 2022, 66.0 percent of community-based clinicians treated VHA enrollees. These clinicians were more likely to be male, have less practice experience, be affiliated with group practices, and be based in rural and socially vulnerable areas compared with clinicians who did not treat VHA enrollees. Notably, clinicians in the lowest quartile of quality performance measures were 8.8 percentage points more likely to treat VHA enrollees than those in the highest quartile. This pattern was most pronounced among primary care and mental health clinicians, and it persisted across VHA Community Care Network regions. These results underscore the need for federal efforts to ensure that veterans receive care from high-performing community clinicians.
New evidence on the labor market effects of scope of practice laws for physicians and nurse practitioners
Moiz Bhai & David Mitchell
Contemporary Economic Policy, January 2025, Pages 31-51
Abstract:
We explore the labor market effects of state-level scope of practice (SOP) reform for nurse practitioners that grants full practice authority (FPA) on the earnings and labor supply decisions of physicians and nurse practitioners. We employ a difference-in-differences research design using data from the American Community Survey between 2010 and 2019 to find that SOP laws granting FPA increase earnings of nurse practitioners and have some impacts on their labor supply. However, we find no effects on the earnings of physicians. To examine mechanisms, we use aggregated Medicare data from the Dartmouth Atlas to show no change on physician reimbursements.
Maternity Ward Crowding, Birth Outcomes, and Future Fertility and Healthcare Decisions: Evidence from California
Yuli Xu & Letian Yin
University of California Working Paper, November 2024
Abstract:
We study how overcrowding in maternity wards influences concurrent birth outcomes and mothers' future fertility and hospital choices by leveraging day-to-day fluctuations in birth counts within Californian hospitals. We find a notable reduction in procedure use -- C-sections, epidurals, inductions, and augmentations -- on crowded days, without compromising maternal or infant health. Despite null effects on future fertility, mothers-particularly non-Black, more educated, and those in less deprived counties-are more likely to switch hospitals or to a nonhospital setting for their next birth. We do not find specific patterns in choice of subsequent hospitals, attributing the decision to negative first-birth experiences.
The Effect of Medicaid on Crime: Evidence from the Oregon Health Insurance Experiment
Amy Finkelstein, Sarah Miller & Katherine Baicker
NBER Working Paper, December 2024
Abstract:
Those involved with the criminal justice system have disproportionately high rates of mental illness and substance use disorders, prompting speculation that health insurance, by improving treatment of these conditions, could reduce crime. Using the 2008 Oregon Health Insurance Experiment, which randomly made some low-income adults eligible to apply for Medicaid, we find no statistically significant impact of Medicaid coverage on criminal charges or convictions. These null effects persist for high-risk subgroups, such as those with prior criminal cases and convictions or mental health conditions. In the full sample, our confidence intervals can rule out most quasi-experimental estimates of Medicaid's crime-reducing impact.
Effects of the Medicaid coverage cliff on low-income elderly Medicare beneficiaries
Kanghyock Koh & Sungchul Park
Health Economics, January 2025, Pages 105-153
Abstract:
The Medicaid coverage "cliff" occurs when Medicare beneficiaries with household income exceeding 100% of the federal poverty level lose eligibility for supplemental Medicaid coverage. Using a regression discontinuity design with data from Medical Expenditure Panel Survey and National Health and Nutrition Examination Survey for 2007-2019, we demonstrate that the cliff increases out-of-pocket spending by 25% and the probability of experiencing problems paying medical bills by 44.4% without decreases in overall health care spending. However, there is evidence that near-poor Medicare beneficiaries changed behavior in response to the cliff, increasing the use of high-value diagnostic and preventive testing by 8.8% and enrollment in a more affordable plan by 12.2%. The cliff does not encourage healthy behavior.
After Risk-Adjustment Change, Dementia Diagnoses Increased In Medicare Advantage Relative To Traditional Medicare
Sidra Haye et al.
Health Affairs, January 2025, Pages 81-89
Abstract:
In 2020, the Centers for Medicare and Medicaid Services reintroduced Alzheimer's disease and related dementias to its risk-adjustment payment model for Medicare Advantage (MA) plans. Using 2017-20 data for 100 percent of community-dwelling beneficiaries enrolled in Medicare, we evaluated how the reintroduction of dementia to the risk-adjustment model affected rates of new (incident) dementia diagnoses among beneficiaries enrolled in MA relative to those enrolled in traditional Medicare. In response to the payment change, annual incident dementia diagnosis rates in MA increased by 11.5 percent relative to traditional Medicare. This increase was concentrated among beneficiaries who were more likely to have undiagnosed dementia -- specifically, beneficiaries who were Hispanic or Black, were ages eighty-five and older, or were dually eligible for Medicaid or received a Part D low-income subsidy. Only a third of the increase came through chart reviews. Financial incentives to detect dementia increased dementia diagnoses, particularly among beneficiaries at high risk for dementia and undetected dementia, but questions remain about potential overdiagnosis or upcoding.
Instrumental Variables with Time-Varying Exposure: New Estimates of Revascularization Effects on Quality of Life
Joshua Angrist et al.
NBER Working Paper, December 2024
Abstract:
The ISCHEMIA Trial randomly assigned patients with ischemic heart disease to an invasive treatment strategy centered on revascularization with a control group assigned non-invasive medical therapy. As is common in such "strategy trials," many participants assigned to treatment remained untreated while many assigned to control crossed over into treatment. Intention-to-treat (ITT) analyses of strategy trials preserve randomization-based comparisons, but ITT effects are diluted by non-compliance. Conventional per-protocol analyses that condition on treatment received are likely biased by discarding random assignment. In trials where compliance choices are made shortly after assignment, instrumental variables (IV) methods solve both problems -- recovering an undiluted average causal effect of treatment for treated subjects who comply with trial protocol. In ISCHEMIA, however, some controls were revascularized as long as five years after random assignment. This paper extends the IV framework for strategy trials, allowing for such dynamic non-random compliance behavior. IV estimates of long-run revascularization effects on quality of life are markedly larger than previously reported ITT and per-protocol estimates. We also show how to estimate complier characteristics in a dynamic-treatment setting. These estimates reveal increasing selection bias in naive time-varying per-protocol estimates of revascularization effects. Compliers have baseline health similar to that of the study population, while control-group crossovers are far sicker.