Public insurance substituting for private insurance: new evidence regarding public hospitals, uncompensated care funds, and medicaid (original) (raw)
Related papers
The Effect of Health Insurance on the Substitution between Public and Private Hospital Care
Economic Record, 2018
Researchers have long been interested in estimating the causal effect of health insurance on health-care utilisation. Less attention has been given to measuring the impact of insurance on the substitution between private and public sector care. We estimate this effect for hospital admissions in Australia. To identify causal effects we use household variables as instruments, namely, information on partner's health and family aspirations. We find that having private health insurance increases the probability of a hospital admission by 5-6 percentage points. This net effect is the result of a considerable substitution from public to private care, which has important policy implications.
Covering the Uninsured: Estimates of the Impact on Total Health Expenditures for 2002
2004
This study estimates the change in national health expenditures that would result if all uninsured persons in the non-elderly population were given health insurance coverage. Our analysis assumes that, after adjusting for individual characteristics, the uninsured, when given coverage, would spend the same for health care as the previously insured. We find that expanding public coverage would have cost 38.1to38.1 to 38.1to41.3 billion in 2002, while expanding private coverage would have cost 53.8to53.8 to 53.8to67.4 billion. These estimates are adjusted for uncompensated care and administrative costs. Public coverage is less costly than private coverage because of lower provider reimbursement rates. G. Edward Miller Division of Modeling and Simulation Center for Financing Access and Cost Trends Agency for Healthcare Research and Quality U.S. Department of Health and Human Services Agency for Healthcare Research and Quality (AHRQ) 540 Gaither Road Rockville, MD 20850 emiller@ahrq.gov Jessica S. Banthin D...
Public health insurance and medical treatment: the equalizing impact of the Medicaid expansions
2001
We investigate the impact of expanding public health insurance on the medical treatment received by women at childbirth, using Vital Statistics data on every birth in the U.S. over the 1987-1992 period. The effects of insurance status on treatment are identified using the tremendous variation in eligibility for public insurance coverage under the Medicaid program over this period. Among low education mothers who were largely uninsured before being made eligible for Medicaid, eligibility for this program was associated with significant increases in the use of a variety of obstetric procedures. Among women with more education, however, there is a countervailing effect on procedure use. Most of these women had private insurance before becoming Medicaid-eligible, and some may have been "crowded out" onto the public program, moving from insurance which reimburses medical care more generously to insurance with much less generous reimbursement. This movement was accompanied by reductions in procedure use. Thus, on net, the Medicaid expansions had an equalizing effect, increasing the treatment intensity of the previously uninsured while lowering it among the previously insured.
THE PRICE AIN'T RIGHT? HOSPITAL PRICES AND HEALTH SPENDING ON THE PRIVATELY INSURED
We use insurance claims data covering 28 percent of individuals with employer-sponsored health insurance in the US to study the variation in health spending on the privately insured, examine the structure of insurer-hospital contracts, and analyze the variation in hospital prices across the nation. Health spending per privately insured beneficiary differs by a factor of three across geographic areas and has a very low correlation with Medicare spending. For the privately insured, half of the spending variation is driven by price variation across regions and half is driven by quantity variation. Prices vary substantially across regions, across hospitals within regions, and even within hospitals. For example, even for a near homogenous service such as lower-limb MRIs, about a fifth of the total case-level price variation occurs within a hospital in the cross-section. Hospital market structure is strongly associated with price levels and contract structure. Prices at monopoly hospitals are 12 percent higher than those in markets with four or more rivals. Monopoly hospitals also have contracts that load more risk on insurers (e.g. they have more cases with prices set as a share of their charges). In concentrated insurer markets the opposite occurs -hospitals have lower prices and bear more financial risk. Examining the 366 mergers and acquisitions that occurred between 2007 and 2011, we find that prices increased by over 6 percent when the merging hospitals were geographically close (e.g. 5 miles or less apart), but not when the hospitals were geographically distant (e.g. over 25 miles apart). JEL Codes: I11, L10, L11. for outstanding research assistance. The opinions expressed in this paper and any errors are those of the authors alone. More details on our analysis and downloadable data, including our roster of hospital mergers, can be found online at www.healthcarepricingproject.org. 1 Our discussion of Medicare is focused on the traditional, publicly administered Medicare program. See Curtu et al. (2017) for a comparison of the traditional, public Medicare program and the privately administered Medicare Advantage program. The remainder of the population have coverage from the Medicaid program, other payers (e.g. the Veterans Administration), or are uninsured.
Australian Health Review, 2007
Objective: To study the effectiveness of recent private health insurance (PHI) reforms, in particular the 30% rebate and Lifetime Health Cover, in terms of their stated aim of reducing the load on public hospitals. Methods: Combines the use of two new projection models ? ?Health Insurance? (PHI) and ?New South Wales Hospitals? that use public and private hospital inpatient data from 1996?97 to 1999?2000, and NSW population and private health insurance coverage statistics. Results: With the PHI reforms 15% fewer individuals would use public hospitals in 2010 than without these reforms (around 18% fewer among the 40% most affluent Australians and 9% among the 40% least affluent). Lower public hospital usage would mainly be due to Lifetime Health Cover. Conclusion: If the PHI reforms remain in place, in 2010 a significant proportion of hospital use would be redirected away from the public sector and towards the private sector, with the shift being greatest among better-off Australians.
Journal of Health Politics, Policy and Law, 1987
This study compares the volume of uncompensated care provided to the uninsured poor in cities with public hospitals to that provided in cities without a public hospital in order to determine whether public hospitals increase access to care. Multiple regression analysis is used to control for selected variables that also influence utilization of hospital care. Cities with public hospitals were found to provide between 31 and 34 uncompensated adjusted admissions per 100 uninsured poor; in cities without a public hospital, 24 such admissions were provided. In the regression analysis the coefficients for dummy variables representing three types of public hospital governance structures were all positive and statistically significant. The coefficient measuring teaching commitment among a city's hospitals was also positive and statistically significant. This analysis suggests that local tax support for public hospitals does not merely offset philanthropic or other revenue sources for voluntary hospital uncompensated care but is also likely to increase the amount of uncompensated care offered. We also find that public hospital closures may reduce access to care for the uninsured poor in large cities. The authors thank Jack Hadley and Judith Feder for comments on an earlier draft, and for providing the data used in our analysis. This research was supported by a grant from the Josiah Macy, Jr. Foundation.
Health economics, 2017
States choose to provide Medicaid coverage via managed care or traditional fee-for-service. Managed care provided by private insurers poses higher contracting costs and information asymmetry than traditional fee-for-service but potentially improves efficiency and reduces spending. Evaluating the effect of managed care on Medicaid spending is challenging because adoption of managed care is nonrandom and may be driven by local economic shocks that simultaneously affect Medicaid spending. This study implements a dynamic panel framework to estimate the effect of managed care enrollment on spending levels and program design. Results show reductions in Medicaid spending larger than previously found in cross-state studies: A 10% increase of managed care enrollment reduces state Medicaid spending by 2.94%, or approximately $55 million. The study identifies which areas of spending are differentially affected by managed care enrollment and whether savings from managed care affect Medicaid des...