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Measuring the relative performance of providers of a health service

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Author Info

  • Daniel A. Ackerberg

    ()
    (University of California, Los Angeles - Department of Economics)

  • Matilde P. Machado

    ()
    (Universidad Carlos III de Madrid - Department of Economics)

  • Michael Riordan

    ()
    (Columbia University)

Abstract

A methodology is developed and applied to compare the performance of publicly funded agencies providing treatment for alcohol abuse in Maine. The methodology estimates a Wiener process that determines the duration of completed treatments, while allowing for agency differences in the effectiveness of treatment, standards for completion of treatment, patient attrition, and the characteristics of patient populations. Notably, the Wiener process model separately identifies agency fixed effects that describe differences in the effectiveness of treatment ('treatment effects'), and effects that describe differences in the unobservable characteristics of patients ('population effects'). The estimated model enables hypothetical comparisons of how different agencies would treat the same populations. The policy experiment of transferring the treatment practices of more cost effective agencies suggests that Maine could have significantly reduced treatment costs without compromising health outcomes by identifying and transferring best practices.

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File URL: http://www.econ.columbia.edu/RePEc/pdf/DP0102-12.pdf
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Bibliographic Info

Paper provided by Columbia University, Department of Economics in its series Discussion Papers with number 0102-12.

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Length: 28 pages
Date of creation: 2002
Date of revision:
Handle: RePEc:clu:wpaper:0102-12

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  1. James J. Heckman & Jeffrey A. Smith, 1995. "Assessing the Case for Social Experiments," Journal of Economic Perspectives, American Economic Association, vol. 9(2), pages 85-110, Spring.
  2. George S Olley & Ariel Pakes, 1992. "The Dynamics Of Productivity In The Telecommunications Equipment Industry," Working Papers 92-2, Center for Economic Studies, U.S. Census Bureau.
  3. Keane, Michael P & Wolpin, Kenneth I, 1997. "The Career Decisions of Young Men," Journal of Political Economy, University of Chicago Press, vol. 105(3), pages 473-522, June.
  4. Charles F. Manski, 1996. "Learning about Treatment Effects from Experiments with Random Assignment of Treatments," Journal of Human Resources, University of Wisconsin Press, vol. 31(4), pages 709-733.
  5. Mingshan Lu, 1999. "Separating the True Effect from Gaming in Incentive-Based Contracts in Health Care," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 8(3), pages 383-431, 09.
  6. Machado, Matilde P., 2001. "Dollars and performance: treating alcohol misuse in Maine," Journal of Health Economics, Elsevier, vol. 20(4), pages 639-666, July.
  7. Butler, J S, et al, 1987. "Measurement Error in Self-reported Health Variables," The Review of Economics and Statistics, MIT Press, vol. 69(4), pages 644-50, November.
  8. Zvi Eckstein & Kenneth I. Wolpin, 1999. "Why Youths Drop Out of High School: The Impact of Preferences, Opportunities, and Abilities," Econometrica, Econometric Society, vol. 67(6), pages 1295-1340, November.
  9. James Heckman, 1997. "Instrumental Variables: A Study of Implicit Behavioral Assumptions Used in Making Program Evaluations," Journal of Human Resources, University of Wisconsin Press, vol. 32(3), pages 441-462.
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Cited by:
  1. Matilde P. Machado, 2003. "Substance Abuse Treatment: What Do We Know? An Economist’S Perspective," Economics Working Papers we035621, Universidad Carlos III, Departamento de Economía.
  2. Lindelow, Magnus & Wagstaff, Adam, 2003. "Health facility surveys : an introduction," Policy Research Working Paper Series 2953, The World Bank.
  3. Lien, Hsien-Ming & Albert Ma, Ching-To & McGuire, Thomas G., 2004. "Provider-client interactions and quantity of health care use," Journal of Health Economics, Elsevier, vol. 23(6), pages 1261-1283, November.

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