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The Technology of Birth: Is It Worth It?

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  • Cutler David M.

    (Harvard University and NBER)

  • Meara Ellen

    (Harvard University and NBER)

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    Abstract

    We evaluate the costs and benefits of increased medical spending for low-birthweight infants. Lifetime spending on low-birthweight babies increased by roughly $40,000 per birth between 1950 and 1990. The health improvements resulting from this have been substantial. Infant mortality rates fell by 72 percent over this time period, largely due to improved care for premature births. Considering both length and quality of life, we estimate the rate of return for care of low-birthweight infants at over 500 percent. Although prenatal care and influenza shots are more cost-effective than neonatal care, it is significantly more cost-effective than other recent innovations, such as coronary artery bypass surgery, treatment of severe hypertension, or routine Pap smears for women aged 20 to 74. We conclude that the answer to the question posed in this paper is a resounding yes.

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    File URL: http://www.degruyter.com/view/j/fhep.2000.3.1/fhep.2000.3.1.1016/fhep.2000.3.1.1016.xml?format=INT
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    Bibliographic Info

    Article provided by De Gruyter in its journal Forum for Health Economics & Policy.

    Volume (Year): 3 (2000)
    Issue (Month): 1 (January)
    Pages: 1-37

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    Handle: RePEc:bpj:fhecpo:v:3:y:2000:n:3

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    Web page: http://www.degruyter.com

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    Web: http://www.degruyter.com/view/j/fhep

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    Cited by:
    1. Douglas Almond & Joseph J. Doyle, Jr. & Amanda E. Kowalski & Heidi Williams, 2008. "Estimating Marginal Returns to Medical Care: Evidence from At-Risk Newborns," NBER Working Papers 14522, National Bureau of Economic Research, Inc.
    2. Katherine Baicker & Douglas Staiger, 2005. "Fiscal Shenanigans, Targeted Federal Health Care Funds, and Patient Mortality," The Quarterly Journal of Economics, MIT Press, vol. 120(1), pages 345-386, January.
    3. Stefan Felder, 2006. "Lebenserwartung, medizinischer Fortschritt und Gesundheitsausgaben: Theorie und Empirie," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 7(s1), pages 49-73, 05.
    4. Cutler, David & McClellan, Mark, 2001. "Productivity Change in Health Care," Scholarly Articles 2640585, Harvard University Department of Economics.
    5. Marianne Bitler, 2005. "Effects of Increased Access to Infertility Treatment on Infant and Child Health Outcomes: Evidence from Health Insurance Mandates," PPIC Working Papers 2005.06, Public Policy Institute of California.
    6. Anna Aizer & Adriana Lleras-Muney & Mark Stabile, 2005. "Access to Care, Provider Choice, and the Infant Health Gradient," American Economic Review, American Economic Association, vol. 95(2), pages 248-252, May.
    7. David Cutler & Ellen Meara, 2001. "Changes in the Age Distribution of Mortality Over the 20th Century," NBER Working Papers 8556, National Bureau of Economic Research, Inc.
    8. David M. Cutler & Mark McClellan, 2001. "Productivity Change in Health Care," American Economic Review, American Economic Association, vol. 91(2), pages 281-286, May.

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