Essays in health economics

Abstract

This thesis contains three independent but interrelated articles within the field of health economics. Essentially, I empirically investigate topics related to the functioning of healthcare systems. Below follows a brief description of the three articles that make up this thesis. The first paper, written jointly with Francisco Costa and Fabio Sanches, exploits location choices and individual characteristics of all generalist physicians who graduated in Brazil between 2001 and 2013 to study policies that aim at increasing the supply of physicians in underserved areas. Physicians’ locational preferences is estimated using a random coefficients discrete choice model. Our findings indicate that physicians have substantial utility gains if they work close to the region they were born or from where they graduated. We show that wages and health infrastructure, though relevant, are not the main drivers of physicians’ location choices. Simulations from the model indicate that quotas in medical schools for students born in poorer areas and the opening of vacancies in medical schools in underserved areas improve the spatial distribution of physicians at lower costs than financial incentives or investments in health infrastructure. The second article, a joint work with Bernard Black, Alex Hollingsworth and Kosali Simon, emphasizes two challenges in using the Affordable Care Act (ACA)’s quasi-experimental variation to study mortality. The first is non-parallel pretreatment trends. Rising mortality in Medicaid non-expansion relative to expansion states prior to Medicaid expansion makes it difficult to estimate the effect of insurance using difference-in-differences (DD). We use various DD, triple difference, age-discontinuity and synthetic control approaches, but are unable to satisfactorily address this concern. Our estimates are not statistically significant, but are imprecise enough to be consistent with both no effect and a large effect of insurance on amenable mortality over the first three post-ACA years. Thus, our results should not be interpreted as evidence that health insurance has no effect on mortality for this age group, especially in light of the literature documenting greater health care use as a result of the ACA. Second, we provide a simulation based power analysis, showing that even the nationwide natural experiment provided by the ACA is underpowered to detect plausibly sized mortality effects in available datasets, and discuss data needs for the literature to advance. Our simulated pseudo-shocks power analysis approach is broadly applicable to other natural-experiment studies. Lastly, the third paper, co-authored with Rudi Rocha and Sonia Bhalotra, wants to understand whether the expansion of pre-hospital care through fixed emergency units in Rio de Janeiro met its goal to alleviate the burden on hospitals’ emergency department, improved hospital performance, and reduced local mortality rates. To investigate the effects of UPAs we use a difference-in-differences approach. We found that UPAs reduced the number of ambulatory procedures performed in hospitals’ emergency rooms by 16.2\%-18.2\%. There was no major change in hospitals’ human resources, infrastructure, admissions and inpatient length of stay. But we found a substantial reduction in total in-hospital and inpatient mortality, which was partially a reallocation of deaths to UPAs. Once we compare the overall mortality of places that implemented these emergency units with the ones that didn’t, we find no differences in total deaths. Yet, their composition changed, suggesting that what happened was not only a transfer of patients from one establishment to the other. We find evidence that UPAs may be helping people with diabetes conditions and people involved in accidents and other external causes. However, cardiovascular diseases appear to be the main hurdle preventing the new dynamic between UPAs and hospitals from reducing overall mortality.