Showing papers in "Health Economics in 2012"

Discrete choice experiments in health economics: A review of the literature

Abstract: Discrete choice experiments (DCEs) have become a commonly used instrument in health economics. This paper updates a review of published papers between 1990 and 2000 for the years 2001-2008. Based on this previous review, and a number of other key review papers, focus is given to three issues: experimental design; estimation procedures; and validity of responses. Consideration is also given to how DCEs are applied and reported. We identified 114 DCEs, covering a wide range of policy questions. Applications took place in a broader range of health-care systems, and there has been a move to incorporating fewer attributes, more choices and interview-based surveys. There has also been a shift towards statistically more efficient designs and flexible econometric models. The reporting of monetary values continues to be popular, the use of utility scores has not gained popularity, and there has been an increasing use of odds ratios and probabilities. The latter are likely to be useful at the policy level to investigate take-up and acceptability of new interventions. Incorporation of interactions terms in the design and analysis of DCEs, explanations of risk, tests of external validity and incorporation of DCE results into a decision-making framework remain important areas for future research.

Using qualitative methods for attribute development for discrete choice experiments: issues and recommendations.

Abstract: Attribute generation for discrete choice experiments (DCEs) is often poorly reported, and it is unclear whether this element of research is conducted rigorously. This paper explores issues associated with developing attributes for DCEs and contrasts different qualitative approaches. The paper draws on eight studies, four developed attributes for measures, and four developed attributes for more ad hoc policy questions. Issues that have become apparent through these studies include the following: the theoretical framework for random utility theory and the need for attributes that are neither too close to the latent construct nor too intrinsic to people's personality; the need to think about attribute development as a two-stage process involving conceptual development followed by refinement of language to convey the intended meaning; and the difficulty in resolving tensions inherent in the reductiveness of condensing complex and nuanced qualitative findings into precise terms. The comparison of alternative qualitative approaches suggests that the nature of data collection will depend both on the characteristics of the question (its sensitivity, for example) and the availability of existing qualitative information. An iterative, constant comparative approach to analysis is recommended. Finally, the paper provides a series of recommendations for improving the reporting of this element of DCE studies.

Does retirement trigger ill health

Abstract: This paper investigates the effects of retirement on various health outcomes Data stem from the first three waves of the English Longitudinal Study of Ageing (ELSA) With these informative data, non-parametric matching and instrumental variable (IV) methods are applied to identify causal effects It is found that retirement significantly increases the risk of being diagnosed with a chronic condition In particular, it raises the risk of a severe cardiovascular disease and cancer This is also reflected in increased risk factors (eg BMI, cholesterol, blood pressure) and increased problems in physical activities Furthermore, retirement worsens self-assessed health and an underlying health stock

Intended and unintended consequences of a proposed national tax on sugar-sweetened beverages to combat the U.S. obesity problem.

Abstract: Monthly data derived from the Nielsen Homescan Panel for calendar years 1998 through 2003 are used to estimate the effects of a proposed tax on sugar-sweetened beverages (SSBs). Most arguments in describing the ramifications of a tax fail to consider demand interrelationships among various beverages. To circumvent this shortcoming we employ a variation of Quadratic Almost Ideal Demand System (QUAIDS) model. The consumption of isotonics, regular soft drinks and fruit drinks, the set of SSBs, is negatively impacted by the proposed tax, while the consumption of fruit juices, low-fat milk, coffee, and tea is positively affected. Diversion ratios are provided identifying where the volumes of the SSBs are directed as a result of the tax policy. The reduction in the body weight as a result of a 20% tax on SSBs is estimated to be between 1.54 and 2.55 lb per year. However, not considering demand interrelationships would result in higher weight loss. Unequivocally, it is necessary to consider interrelationships among non-alcoholic beverages in assessing the effect of the tax.

The effect of job loss and unemployment duration on suicide risk in the United States: a new look using mass-layoffs and unemployment duration

Abstract: We examine the link between employment status and suicide risk using a panel of US states from 1996 to 2005 with monthly data on suicides, the duration of unemployment spells and the number of job losses associated with mass layoff events. The use of aggregate data at the monthly level along with the distribution of unemployment duration allows us to separate the effect of job loss from the effect of unemployment duration, an important distinction for policy purposes, especially for the timing of potential interventions. Our results are consistent with unemployment duration being the dominant force in the relationship between job loss and suicide. Nevertheless, mass layoffs may be powerful localized events where suicide risk increases shortly afterward. Implications for the design of unemployment insurance are discussed.

Easing the pain of an economic downturn: macroeconomic conditions and excessive alcohol consumption

Abstract: Individuals can react to financial stress in a variety of ways, such as reducing discretionary spending or engaging in risky behaviors. This article investigates the effect of changing macroeconomic conditions (measured by the unemployment rate in the state of residence) on one type of risky behavior: excessive alcohol consumption. Using unique and recent panel data from waves 1 and 2 of the National Epidemiological Survey on Alcohol and Related Conditions (NESARC) and estimating fixed-effects models, we find that changes in the unemployment rate are positively related to changes in binge drinking, alcohol-involved driving, and alcohol abuse and/or dependence. Some differences are present among demographic groups, primarily in the magnitude of the estimated effects. These results contradict previous studies and suggest that problematic drinking may be an indirect and unfortunate consequence of an economic downturn.

The effect of retirement on cognitive functioning

Abstract: Cognitive impairment has emerged as a major driver of disability in old age, with profound effects on individual well-being and decision making at older ages. In the light of policies aimed at postponing retirement ages, an important question is whether continued labour supply helps to maintain high levels of cognition at older ages. We use data of older men from the US Health and Retirement Study to estimate the effect of continued labour market participation at older ages on later-life cognition. As retirement itself is likely to depend on cognitive functioning and may thus be endogenous, we use offers of early retirement windows as instruments for retirement in econometric models for later-life cognitive functioning. These offers of early retirement are legally required to be nondiscriminatory and thus, inter alia, unrelated to cognitive functioning. At the same time, these offers of early retirement options are significant predictors of retirement. Although the simple ordinary least squares estimates show a negative relationship between retirement duration and various measures of cognitive functioning, instrumental variable estimates suggest that these associations may not be causal effects. Specifically, we find no clear relationship between retirement duration and later-life cognition for white-collar workers and, if anything, a positive relationship for blue-collar workers.

Willingness‐to‐pay for predictive tests with no immediate treatment implications: a survey of US residents

Abstract: We assessed how much, if anything, people would pay for a laboratory test that predicted their future disease status. A questionnaire was administered via an internet-based survey to a random sample of adult US respondents. Each respondent answered questions about two different scenarios, each of which specified: one of four randomly selected diseases (Alzheimer's, arthritis, breast cancer, or prostate cancer); an ex ante risk of developing the disease (randomly designated 10 or 25%); and test accuracy (randomly designated perfect or 'not perfectly accurate'). Willingness-to-pay (WTP) was elicited with a double-bounded, dichotomous-choice approach. Of 1463 respondents who completed the survey, most (70-88%, depending on the scenario) were inclined to take the test. Inclination to take the test was lower for Alzheimer's and higher for prostate cancer compared with arthritis, and rose somewhat with disease prevalence and for the perfect versus imperfect test [Correction made here after initial online publication.]. Median WTP varied from $109 for the imperfect arthritis test to $263 for the perfect prostate cancer test. Respondents' preferences for predictive testing, even in the absence of direct treatment consequences, reflected health and non-health related factors, and suggests that conventional cost-effectiveness analyses may underestimate the value of testing.

The developmental origins of health.

Abstract: This paper argues that health economists should consider the costs and benefits of preventing rather than treating disease. It sketches a developmental approach to health that examines the costs and benefits of interventions over the life cycle.

Is there a health penalty of China's rapid urbanization?

Abstract: While highly pertinent to the human welfare consequences of development, the impact of rapid urbanization on population health is not obvious. This paper uses community and individual-level longitudinal data from the China Health and Nutrition Survey to estimate the net health impact of China's unprecedented urbanization. We construct an index of urbanicity from a broad set of community characteristics and define urbanization in terms of movements across the distribution of this index. We use difference-in-differences estimators to identify the treatment effect of urbanization on the self-assessed health of individuals. We find that urbanization raises the probability of reporting of poor health and that a greater degree of urbanization has a larger effect. The effect may, in part, be attributable to changed health expectations, but it also appears to operate through health behaviour. Populations experiencing urbanization tend to consume more fat and smoke more.

The effect of waiting time and distance on hospital choice for English cataract patients

Abstract: This paper applies latent-class multinomial logit models to the choice of hospital for cataract operations in the UK NHS. We concentrate on the effects of travel time and waiting time and especially on estimating the waiting time elasticity of demand. Models including hospital fixed effects rely on changes over time in waiting time to indentify coefficients. We show how using a latent-class multinomial logit model characterises the unobserved heterogeneity in GP practices' choice behaviour and affects the estimated elasticities of travel time and waiting time. The models estimate waiting time elasticities of demand of approximately -0.1, comparable with previous waiting time-demand models. For the average waiting time elasticity, the simple multinomial logit models are good approximations of the latent-class logit results.

A matching method for improving covariate balance in cost-effectiveness analyses

Abstract: In cost-effectiveness analyses (CEA) that use randomized controlled trials (RCTs), covariates of prognostic importance may be imbalanced and warrant adjustment. In CEA that use non-randomized studies (NRS), the selection on observables assumption must hold for regression and matching methods to be unbiased. Even in restricted circumstances when this assumption is plausible, a key concern is how to adjust for imbalances in observed confounders. If the propensity score is misspecified, the covariates in the matched sample will be imbalanced, which can lead to conditional bias. To address covariate imbalance in CEA based on RCTs and NRS, this paper considers Genetic Matching. This matching method uses a search algorithm to directly maximize covariate balance. We compare Genetic and propensity score matching in Monte Carlo simulations and two case studies, CEA of pulmonary artery catheterization, based on an RCT and an NRS. The simulations show that Genetic Matching reduces the conditional bias and root mean squared error compared with propensity score matching. Genetic Matching achieves better covariate balance than the unadjusted analyses of the RCT data. In the NRS, Genetic Matching improves on the balance obtained from propensity score matching and gives substantively different estimates of incremental cost-effectiveness. We conclude that Genetic Matching can improve balance on measured covariates in CEA that use RCTs and NRS, but with NRS, this will be insufficient to reduce bias; the selection on observables assumption must also hold.

The powers and pitfalls of payment for performance.

Abstract: Throughout the world, healthcare policy makers confront common problems: expenditure inflation, inefficiency and inequity in access to care. The development of health economics during the last 20 years has produced a consensus (outside the USA) about the merits of ‘single-payer’ systems and the need to evaluate the cost-effectiveness of competing medical technologies. These are necessary but not sufficient conditions for expenditure control and efficient rationing (Williams, 1972; Reinhardt, 1982; Hsiao, 2011; Maynard, 1997; Culyer and Rawlins, 2004). Recent reforms have had a modest effect on the efficiency of resource allocation in health care. Exacerbated by the global economic downturn, the desire for more radical improvements in efficiency has led to increased interest amongst policy makers in a vigorous payment-for-performance (P4P) culture based principally on the belief that financial incentives are efficient ways of mitigating variations in clinical practice and ensuring the delivery of conservative, cost-effective interventions. The failure of public and private healthcare markets to deliver patient care efficiently, equitably and within budgets has a long history. This is reviewed in the next section and followed by a discussion of case studies of P4P, primarily in the context of healthcare provision. A selective use of this literature is used to draw out a list of central research questions to be addressed by the rapidly evolving P4P initiatives.

Missing data in trial-based cost-effectiveness analysis: the current state of play.

Abstract: SUMMARY Randomised controlled trial (RCT)-based cost-effectiveness analyses, which are prone to missing data, are increasingly used in healthcare technology assessment. This has highlighted the need for appropriate methodological approaches to the handling of missing data. This paper reviews missing data methodology used in RCT-based cost-effectiveness analyses since 2003. Complete case analysis, which may lead to inappropriate conclusions, is still the most popular approach and its use has increased with time. The degree of missing data in cost-effectiveness analyses was often poorly reported and the methodology was often unclear. Reporting of missing data sensitivity analyses would improve article transparency. Copyright © 2010 John Wiley & Sons, Ltd.

The effects of insurance mandates on choices and outcomes in infertility treatment markets

Abstract: For the 10% to 15% of American married couples who experience reproductive problems, in vitro fertilization (IVF) is the leading technologically advanced treatment procedure. However, IVF's expense may prevent many couples from receiving treatment, and those who are treated may take an overly aggressive approach to reduce the probability of failure. Aggressive treatment, which occurs through an increase in the number of embryos transferred during IVF, can lead to medically dangerous multiple births. We evaluated the principle policy proposal-insurance mandates-for improving IVF access and outcomes. We used data from US markets during 1995-2003 to show that broad insurance mandates for IVF result in not only large increases in treatment access but also significantly less aggressive treatment. More limited insurance mandates, which may apply to a subset of insurers or provide weaker guidelines for insurer behavior, generally have little effect on IVF markets.

Sf-6d population norms.

Abstract: The derivation of population norms using simple generic health-related quality of life measures to inform policy has been recommended in the literature. This letter illustrates the derivation of population norms for the SF-6D in the United Kingdom. It uses a sample of 22,166 respondents from the 2010 wave of the study Understanding Society. Understanding Society is a national representative sample of British citizens. The survey of this study contains the SF-12. It is possible to derive health state utilities from the SF-12 (and from the SF-36) using a relatively new instrument, the SF-6D. The SF-12 and the SF-36 belong to the most widely used generic health-related quality of life measures. Mean SF-6D utility scores for males and females are 0.81 and 0.79, respectively. Especially the older age categories have lower utility scores. The younger age categories have slightly higher utility scores. From a list of 17 conditions, people with congestive heart failure had the lowest (0.60) and people with diabetes the highest (0.76) SF-6D scores. This letter encourages the health economics research community to derive SF-6D population norms to inform policy. Copyright © 2012 John Wiley & Sons, Ltd.

Parental income and child health in Germany.

Abstract: Using newly available data from Germany, we study the relationship between parental income and child health. We find a strong gradient between parental income and subjective child health as has been documented earlier in the United States, Canada, and the United Kingdom. The relationship in Germany is about as strong as in the United States and stronger than in the United Kingdom. However, in contrast to US results, we do not find consistent evidence that the disadvantages associated with low parental income accumulate as the child ages, nor that children from low socioeconomic background are more likely to suffer from doctor-diagnosed conditions. There is some evidence, however, that high-income children are better able to cope with the adverse consequences of chronic conditions. Investigating potential diagnosis bias, we find only weak evidence for health disadvantages for low-income children when using objective health measures, but some evidence for under-utilization of health services among low-income families.

What is driving the black–white difference in low birthweight in the US?

Abstract: SUMMARY This is a first effort to quantify the contribution of different factors in explaining racial difference in low birthweight rate (LBW). Mother's health, child characteristics, prenatal care, socioeconomic status (SES), and the socioeconomic and healthcare environment of mother's community are important inputs into the birthweight production function, and a vast literature has delved into obtaining causal estimates of their effect on infant health. What is unknown is how much of the racial gap in LBW is explained by all these inputs together. We apply a nonlinear extension of the Oaxaca–Blinder method proposed by Fairlie to decompose this gap into the portion explained by differences in observed characteristics and the portion that remains unexplained. Data are obtained from several sources in order to capture as many observables as possible, although the primary data source is the Natality Detail Files. Results show that of the 6.8 percentage point racial gap in LBW, only 0.9–1.9 points are explained by white–black differences in endowments across those measures, and of those endowments, most of the gap in LBW is explained by the differences in SES. The unexplained difference is attributed to racial differences in the returns to or the marginal product of investments in infant health. Copyright © 2011 John Wiley & Sons, Ltd.

Inheritances, Health and Death

Abstract: We examine how wealth shocks, in the form of inheritances, affect the mortality rates, health status and health behaviors of older adults, using data from eight waves of the Health and Retirement Survey. Our main finding is that bequests do not have substantial effects on health, although improvements in quality-of-life are possible. This absence occurs despite increases in out-of-pocket spending on healthcare and in the utilization of medical services, especially discretionary and non-lifesaving types such as dental care. Nor can we find a convincing indication of changes in lifestyles that offset the benefits of increased medical care. Inheritances are associated with higher alcohol consumption, but with no change in smoking or exercise and a possible decrease in obesity.

The impact of voluntary health insurance on health care utilization and out-of-pocket payments: new evidence for Vietnam.

Abstract: Vietnam aims to achieve full coverage of health insurance in 2015. An increasing type of health insurance in Vietnam is voluntary health insurance. Although there are many studies on the implementation of voluntary health insurance in Vietnam, little is known on the causal impact of voluntary health insurance. This paper measures the impact of voluntary health insurance on health care utilization and out-of-pocket payments using Vietnam Household Living Standard Surveys in 2004 and 2006. It was found out that voluntary health insurance helps the insured people increase the annual outpatient and inpatient visits by around 45% and 70%, respectively. However, the effect of voluntary health insurance on out-of-pocket expenses on health care services is not statistically significant.

Copula bivariate probit models: with an application to medical expenditures.

Abstract: The bivariate probit model is frequently used for estimating the effect of an endogenous binary regressor (the 'treatment') on a binary health outcome variable. This paper discusses simple modifications that maintain the probit assumption for the marginal distributions while introducing non-normal dependence using copulas. In an application of the copula bivariate probit model to the effect of insurance status on the absence of ambulatory health care expenditure, a model based on the Frank copula outperforms the standard bivariate probit model.

How well do diagnosis-related groups explain variations in costs or length of stay among patients and across hospitals? Methods for analysing routine patient data

Abstract: We set out an analytical strategy to examine variations in resource use, whether cost or length of stay, of patients hospitalised with different conditions. The methods are designed to evaluate (i) how well diagnosis-related groups (DRGs) capture variation in resource use relative to other patient characteristics and (ii) what influence the hospital has on their resource use. In a first step, we examine the influence of variables that describe each individual patient, including the DRG to which the patients are assigned and a range of personal and treatment-related characteristics. In a second step, we explore the influence that hospitals have on the average cost or length of stay of their patients, purged of the influence of the variables accounted for in the first stage. We provide a rationale for the variables used in both stages of the analysis and detail how each is defined. The analytical strategy allows us (i) to identify those factors that explain variation in resource use across patients, (ii) to assess the explanatory power of DRGs relative to other patient and treatment characteristics and (iii) to assess relative hospital performance in managing resources and the characteristics of hospitals that explain this performance.

Social capital and self-rated health in Argentina.

Abstract: The potential link between social capital and health suggests important pathways by which health may be improved. We examine this relationship using a unique data set from Argentina. This national survey allows us to determine whether the relationships between social capital and health that have been found in the US and Europe also apply to countries in South America (Argentina is the second-largest country in South America with a population of approximately 40 million). We estimate a causal effect of individual-level social capital on health using a measure of informal social interactions as our measure of social capital. Using information about access to public transportation as instrumental variables, we find that both men and women with higher levels of social capital report better health.

Unfit for service: the implications of rising obesity for us military recruitment

Abstract: This paper contributes to the literature on the labor market consequences of unhealthy behaviors and poor health by examining a previously underappreciated consequence of the rise in obesity in the USA: challenges for military recruitment. Specifically, this paper estimates the percentage of the US military-age population that exceeds the US Army's current active duty enlistment standards for weight-for-height and percent body fat, using data from the series of National Health and Nutrition Examination Surveys that spans 1959–2008. We calculate that the percentage of military-age adults ineligible for enlistment because they are overweight and overfat more than doubled for men and tripled for women during that time. As of 2007–2008, 5.7 million men and 16.5 million women exceeded the Army's enlistment standards for weight and body fat. We document disparities across race and education in exceeding the standards and estimate that a further rise of just 1% in weight and body fat would further reduce eligibility for military service by over 850 000 men and 1.3 million women. The paper concludes with a discussion of the implications of these findings for military recruitment and defense policy. Copyright © 2011 John Wiley & Sons, Ltd.

The determinants of Chinese provincial government health expenditures: evidence from 2002-2006 data.

Abstract: There is great divergence in provincial government health expenditures in China. Real per capita provincial government health expenditures (GHE) over the period 2002-2006 are examined using panel regression analysis. Key determinants of real per capita provincial GHE are real provincial per capita general budget revenue, real provincial per capita transfers from the central government, the proportion of provincial population under age 15, urban employee basic health insurance coverage, and proportion of urban population. Roughly equal and relatively low elasticities of budget revenue and transfers imply that the GHE is a necessity rather than a luxury good, and transfers have yet to become efficient instruments for the fair allocation of health resources by policy makers. Moreover, severe acute respiratory syndrome outbreak has increased the GHE, but we find no statistical evidence that provincial GHE have fluctuated according to the public health status.

The impact of long-term participation in the supplemental nutrition assistance program on child obesity.

Abstract: SUMMARY Participation in the Supplemental Nutrition Assistance Program (SNAP) reached an all-time high of 402 million persons in March 2010, which means the program affects a substantial fraction of Americans A significant body of research has emerged suggesting that participation in SNAP increases the probability of being obese for adult women and has little effect on the probability for adult men However, studies addressing the effects of participation on children have produced mixed results This paper examines the effect of long-term SNAP participation on the Body Mass Index (BMI) percentile and probability of being overweight or obese for children ages 5–18 using data from the National Longitudinal Survey of Youth 1979 Children and Young Adults data set An instrumental variables identification strategy that exploits exogenous variation in state-level program parameters, as well as state and federal expansions of the Earned Income Tax Credit (EITC), is used to address the endogeneity between SNAP participation and obesity SNAP participation is found to significantly reduce BMI percentile and the probability of being overweight or obese for boys and girls ages 5–11 and boys ages 12–18 For girls ages 12–18, SNAP participation appears to have no significant effect on these outcomes Copyright © 2011 John Wiley & Sons, Ltd

What factors influence the earnings of general practitioners and medical specialists? evidence from the medicine in australia: balancing employment and life survey

Abstract: Terence Chai Cheng, Anthony Scott, Sung-Hee Jeon, Guyonne Kalb, John Humphreys and Catherine Joyce

Labor mobility of the direct care workforce: implications for the provision of long-term care.

Abstract: This study provides the first comprehensive analysis of the dynamics of labor supply of direct care workers, the lower-skill nursing workers who provide the bulk of long-term care for the elderly in the USA. Our estimates from the 1996 and 2001 panels of the Survey of Income and Program Participation (SIPP) show that the mean (median) duration of employment spells for the same direct care employer is only 9.7 (5.0) months. We find that fewer than one-third of direct care workers leave a job to take another job in the direct care field. There is also little indication of upward mobility in the health sector; direct care workers are approximately equally likely to transition to working as Registered Nurses as they are to working in household service jobs. Additionally, the rate at which spells end in work-limiting disability (5.4%) is very high compared with rates in similar occupations. We estimate duration models of direct care job spell length and find that, after correcting for the endogenous relationship between wages and tenure, wages appear to have a modest effect in preventing turnover; this effect is concentrated among the shortest spells.

Health status and the allocation of time

Abstract: SUMMARY We consider the relationship between health and time allocation in the American Time Use Survey. Better health is associated with large positive effects on home production and larger positive effects on market production, but less consumption of leisure. Theoretically, if market- and home-produced goods are perfect substitutes, the positive correlation between health and home production implies that health exerts larger effects on home than on market efficiency. Notably, these correlations are higher for single people than for married people, perhaps reflecting a lack of market substitutes for the time of married people. Copyright © 2011 John Wiley & Sons, Ltd.

Food insecurity and the relationship between household income and children's health and nutrition in Brazil

Abstract: Empirical evidence indicates that children living in wealthier households have better health. Food insecurity could be related to lack of adequate nutrition experienced by poor children and may be pointed out as one of the possible explanations for this relationship. This paper investigates the association between food insecurity and children's health and nutrition and the role of the former in the child health income gradient. Using data from the 2006 Brazilian Demographic and Health Survey, the results show that children living in households with food insecurity have worse nutrition and health indicators. In addition, the relationship between household income and many children's health and nutrition measures weakens but remains significant when controlling for food insecurity.