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Contributed Papers in Health Economics

Paper Session

Friday, Jan. 6, 2017 1:00 PM – 3:00 PM

Hyatt Regency Chicago, Plaza A
Hosted By: Health Economics Research Organization
  • Chair: Michael Fitzmaurice, JMF Associates

Pricing of Hospital Cardiac Procedures: Impacts of Federal Quality Reports

Katheleen Carey
,
Boston University

Abstract

A policy concern is that the initiation of federal Hospital Compare (HC) reporting provided leverage to insurers in price negotiations for lowering prices without regard to hospital performance. To explore this issue we estimate variants of difference-in-difference models where HC impacts vary by ratings. We examine the effects of the three main scores (heart attack, heart failure, and combined mortalities) on transaction prices of related medical procedures. States which mandated reporting systems prior to HC form the control group. Analyzing claims data of privately insured patients, we find that HC exerted downward pressure on prices. However, hospitals rated “above average” captured higher prices, thereby offsetting the overall policy effect. We conclude that HC was effective at constraining prices without penalizing high performers.

Mandatory Quality Disclosure and Forward-looking Firm Behavior

Ian McCarthy
,
Emory University

Abstract

Mandatory quality disclosure is pervasive across several industries and often includes a period over which the quality of new entrants is unreported. This provides the opportunity for forward-looking firms to adjust product characteristics in advance of disclosure. Using comprehensive data on Medicare Advantage from 2007-2014, I first demonstrate empirically that there exists a consumer response to quality disclosure and persistence in market shares over time. I then investigate the presence of forward-looking behavior, where I find that low-quality firms benefit from nondisclosure of quality by charging higher premiums and offering less variety across markets.

Bargaining, Competition and Price in Hospital Markets

Eric Barrette
,
Health Care Cost Institute
Gautum Gowrisankaran
,
University of Arizona
Aviv Nevo
,
Northwestern University
Robert Town
,
University of Pennsylvania

Abstract

TBA

The New Dynamics of United States Health Insurance

John Graves
,
Vanderbilt University

Abstract

TBA
Discussant(s)
James Bailey
,
Creighton University
Michael Darden
,
Tulane University
Martin Gaynor
,
Carnegie Mellon University
Samuel Zuvekas
,
Agency for Healthcare Research and Quality
JEL Classifications
  • I0 - General