Health insurance generosity and conditional coverage: Evidence from medicaid managed care in Kentucky

This article estimates the impact of the introduction of Medicaid managed care (MMC) on the formal Medicaid participation of children. We employ a quasi‐experimental approach exploiting the location‐specific timing of MMC implementation in Kentucky. Using data from the March Current Population Survey from 1995 to 2003, our findings suggest that the introduction of MMC increases the likelihood of being uninsured and decreases formal Medicaid participation. This finding is consistent with an increase in “conditional coverage,” waiting until medical care is needed to sign up or re‐enroll in Medicaid. These effects are concentrated among low‐income children and absent for high‐income children. We find no evidence of “crowd‐in,” substituting private coverage for Medicaid. These results are robust to multiple placebo tests and imply the potential for less formal participation (i.e., more conditional coverage) among the Affordable Care Act‐Medicaid expansion population (which is likely to be primarily covered under MMC) than is typically predicted.     

The Medicaid program: The low-income health care subsidy

Conclusions While these data are inadequate to empirically test the foregoing three hypotheses, they are sufficient to caste doubt on the validity of the assumption upon which the design of the low-income medical care subsidy is based; i.e., that the private medical care market is efficient and therefore adequate to meet the health needs of all low-income groups. Further, analysis of the supply side of the market may show in-kind demand subsidies insufficient to improve the health status of the poor. A coordinated demand and supply subsidy may be necessary.     

Rural-Urban Differences in the Unemployment-Crime Relationship: The Case of Pennsylvania

This study analyzes the unemployment-crime (U-C) relationship in urban and rural Pennsylvania counties using a balanced panel data set over the period from 1990 to 2009. A two-way fixed effects model is estimated to account for unobserved county-specific and time-specific heterogeneity. The criminal opportunity and criminal motivation effects of unemployment on crime advanced by Cantor and Land are tested. The results suggest that there are rural-urban differences in the impacts of the covariates. Specifically, both statistically significant criminal opportunity and criminal motivation effects are present in urban counties. In contrast, rural counties fail to conform to U-C predictions. Oaxaca decomposition reveals that the unexplained portion of the rural-urban difference in the crime rate is 12%. The results provide support for addressing labor market conditions to complement traditional crime-fighting measures in urban settings.     

Cross product subsidization in the health insurance market with managed care: A model and issues

One theory of insurance markets suggests that entering insurers expect incumbent insurers to react to the entry of new products, offering a combination of products where, breaking even, one makes positive economic profits and the other makes a loss. This theory is extended to include moral hazard, in which the magnitude of the loss depends on insurance coverage, and a stylized model of managed care. With moral hazard, cross-subsidization is still predicted. In contrast to prior results, the coverage for the highest risk individuals will vary with the portion of high-risk individuals in the market. The inclusion of managed care as a signaling instrument does not disrupt cross-product subsidization. These theoretical predictions are discussed in light of the absence of empirical support to date and in light of other factors that might limit or enhance an insurer's ability to subsidize across products.     

Gatekeeper incentives and demand inducement: An empirical analysis of care managers in the Japanese long-term care insurance program

This study analyzes the incentives and supplier-induced demand of care managers, who are intermediaries between consumers and service providers in the Japanese social insurance program for long-term care. Care managers can be considered as pure gatekeepers, in that their function is limited to referral people to specialists and they themselves do not provide care. Care managers are rewarded by capitation, which is considered as a cost-effective payment mechanism for insurers. However, many care managers actually work for firms that also operate as service providers. Service providers are rewarded by a fee-for-service payment and can have a motivation to induce excess consumer demand. The violation of the neutrality of care managers might result in a financial burden on social insurance. In this study, we empirically test whether there is a positive correlation between care manager density and care costs, which might imply the existence of supplier-induced demand. Our results show a positive correlation, particularly in the case of care managers who work for firms that jointly operate in service provision sectors. Based on these results, we conduct a quantitative analysis, and show that the demand induced by care managers might produce a considerable financial burden on social insurance.     

Residential Consumer Switching and Electricity Restructuring Policy: The Pennsylvania Power Market

Without significant price reduction, high consumer switching rates to competitive power suppliers have been criticized as a result of either the artificially high price to compare (PC) acting as the benchmark price that competitive generators must meet, or the critical mass effect from switching consumers. This paper builds a simple model to explore how the restructuring policy determines residential switching behavior. When the PC increases over time, whether it reflects the rising wholesale price adequately or not, a consistent price reduction policy will naturally induce an early-stage high switching rate. In contrast, a required switching rate policy that is associated with both an artificial price cut at the early stage and a longer period of stranded cost recovery can accelerate switching effectively. Two high-cost Pennsylvania utilities, which demonstrate opposite movements of residential switching rate under different restructuring policies, are examined to confirm that the high switching rate just results from the policy design, not from the subsidy in PC discussed in (Joskow, Paul L. “Why Do We Need Electricity Retailers? Or, Can You Get It Cheaper Wholesale?” Center for Energy and Environmental Policy Research, MIT, Revised discussion draft, 2000b), or the critical mass effect concluded in (Reitzes, James D., Lisa V. Wood, J. A. Quinn, and Kelli L. Sheran. “Designing Standard-Offer Service to Facilitate Electric Retail Restructuring.” The Electricity Journal 15, 9, 2003, pp. 34–51). Switching rates play no role in evaluating the success or failure of a restructuring.     

Intergovernmental competition for donations: The case of the Furusato Nozei program in Japan

This paper shows that municipalities compete excessively for donations under a unique program called Furusato Nozei (Tax payment to hometown) in Japan. Under the program, people make donations to their favorite municipalities and municipalities that have received donations give reciprocal gifts in return. This causes governments to compete for donations by setting “return rates” — the value of a gift as a percentage of the donation received. Our estimates show that, in the most likely case, this competition reduces net revenue by at least 7.5% compared to when the municipalities do not compete for donations.     

The real exchange rate and intervention under the managed float: Dilemmas of a central banker

Conclusion This paper has attempted to rationalize some recent widespread trends in the balance of payments of several countries. It has been argued that the exchange-market intervention techniques followed by certain countries especially in the presence of high capital mobility, may have contributed to the observed instability. Such a notion is not new. The innovation of the note is to demonstrate that even a gradulaist and anticipated popular intervention policy can be potentially destabilizing.The usual disclaimer applies with respect to all remaining errors.     

The basic needs approach to development: The question of health care for black people in Natal 1

Health care is an important facet of the basic needs approach. Health care for black people in Natal is fragmented both with regard to the responsible authority (Department of National Health and Population Development, Natal Provincial Administration, Development Services Board, local authorities and welfare clinics) and spatially (since there is an overlap with KwaZulu health services). Access to health facilities (permanent and mobile), although adequate in some areas, is insufficient in others: the deficiency is most marked in rural areas and with regard to permanent health facilities. Crucial statistical data pertaining to health status are inadequate partly because of the aforementioned fragmentation and partly because they are collected for administrative rather than monitoring purposes. Questions are posed regarding future access to health care in the light of the new constitutional dispensation, privatisation and the inadequate attention being given to primary health care.     

The village midwife program and infant mortality in Indonesia

Indonesia introduced over 50,000 midwives into villages in the 1990s to provide primary care to women lacking easy access to health facilities. It seems plausible to argue that the significant reduction in infant mortality that occurred from about 1993–94 was a consequence of this. The paper estimates the village midwife program's impact on infant mortality, using data from the Indonesia Family Life Survey. Regressing mortality outcomes against choice of services would lead to biased estimates because of the correlation between service choice and unobserved individual characteristics. Furthermore, non-random placement of midwives could bias estimates of their impact on infant mortality. This study overcomes such endogeneity problems by aggregating mortality outcomes and program prevalence at district level and taking account of district fixed effects in estimating the program's impact. Surprisingly, the results do not support the hypothesis that the midwife program was responsible for the observed decline in infant mortality.     

School effectiveness in Zambia: The origins of differences between rural and urban outcomes

Surveys have shown that Zambian urban residents have significantly higher schooling attainment rates than rural residents and are more likely to be literate. To address this inequality in education outcomes it is important to understand to what extent this is a result of a resource gap (for example, differences in teachers or textbooks) or different returns on resources (for example, an additional teacher makes more of a difference in urban areas). To explore this idea this study performed an Oaxaca decomposition on the SACMEQ II data set for Zambia. The results showed that the rural–urban gap was attributable both to differences in the presence of resources (55% of the gap) and differences in the returns on resources (45% of the gap). Since returns on resources are considerably lower in rural areas, additional resource investment alone is unlikely to close the gap between rural and urban schooling outcomes.     

Health and development: The Venda care group organisation

Health is one of the crucial problems confronting the development of Third World countries. Community‐based primary health care is the best instrument for mobilising community development.Development through health, however, can only be achieved if primary health care is implemented in a comprehensive approach in which a supportive environment and living conditions are as important as the provision of health care services. The Venda care group organisation, like other village health workers, is involved in primary health care and community development in the communities of the care groups. Such supportive community‐based organisations are able to alleviate health and development problems at the grass roots provided that programmes and activities are based on community participation, self‐reliance and the development of local decision‐making and leadership skills. The degree of success of the Venda care group organisation in achieving these objectives was investigated.     

Child survival in East Africa: The impact of preventive health care

Since the mid-1980s or earlier, several East African countries have experienced constant or rising child mortality rates concurrent with social and biomedical improvements of the “Child Survival Revolution”. This study examines whether preventive primary health care enhanced early child survival in the late 1980s and early 1990s in five East African countries. Child mortality rates were considerably lower than they would have been in the absence of specific immunizations, access to safe drinking water, fertility regulation, and frequent antenatal care visits. There was, however, substantial missed opportunity for mortality decline as a result of insufficient use of preventive measures. In particular, universal immunization across these countries could have reduced rates of mortality under age two by as much as one-third. Continued pursuit of the goals of the World Summit for Children appears essential to offset macroeconomic and growing epidemiological constraints to child survival in the region.