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The Effect of Medicaid Physician Fees on Take-up of Public Health Insurance among Children in Poverty

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  • Youjin Hahn

Abstract

I investigate how changes in fees paid to Medicaid physicians affect take-up among children in low-income families. The existing literature suggests that the low level of Medicaid fee payments to physicians reduces their willingness to see Medicaid patients, thus creating an access-to-care problem for these patients. For the identical service, current Medicaid reimbursement rates are only about 65 percent of those covered by Medicare. Increasing the relative payments of Medicaid would increase its perceived value, as it would provide better access to health care for Medicaid beneficiaries. Using variation in the timing of the changes in Medicaid payment across states, I find that increasing Medicaid generosity is associated with both an increase in take-up and a reduction in uninsured rate. These results provide a partial answer to the puzzling question of why many low-income children who are eligible for Medicaid remain uninsured.

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File URL: http://www.buseco.monash.edu.au/eco/research/papers/2012/2912effectofmedicaidhahn.pdf
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Bibliographic Info

Paper provided by Monash University, Department of Economics in its series Monash Economics Working Papers with number 29-12.

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Length: 35 pages
Date of creation: Sep 2012
Date of revision:
Handle: RePEc:mos:moswps:2012-29

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Postal: Department of Economics, Monash University, Victoria 3800, Australia
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Web page: http://www.buseco.monash.edu.au/eco/
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Keywords: Medicaid; Take-up; Medicaid payment; Medicaid reimbursement; Access to care;

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  1. Janet Currie & Jonathan Gruber & Michael Fischer, 1994. "Physician Payments and Infant Mortality: Evidence from Medicaid Fee Policy," NBER Working Papers 4930, National Bureau of Economic Research, Inc.
  2. Laurence C. Baker & Anne Beeson Royalty, 2000. "Medicaid Policy, Physician Behavior, and Health Care for the Low-Income Population," Journal of Human Resources, University of Wisconsin Press, vol. 35(3), pages 480-502.
  3. Currie, Janet & Gruber, Jonathan, 1996. "Health Insurance Eligibility, Utilization of Medical Care, and Child Health," The Quarterly Journal of Economics, MIT Press, vol. 111(2), pages 431-66, May.
  4. Jonathan Gruber & Kathleen Adams & Joseph P. Newhouse, 1997. "Physician Fee Policy and Medicaid Program Costs," NBER Working Papers 6087, National Bureau of Economic Research, Inc.
  5. Long, Stephen H. & Settle, Russell F. & Stuart, Bruce C., 1986. "Reimbursement and access to physicians' services under Medicaid," Journal of Health Economics, Elsevier, vol. 5(3), pages 235-251, September.
  6. Nyman, John A., 1999. "The value of health insurance: the access motive," Journal of Health Economics, Elsevier, vol. 18(2), pages 141-152, April.
  7. Phillip B. Levine & Diane Whitmore Schanzenbach, 2009. "The Impact of Children's Public Health Insurance Expansions on Educational Outcomes," NBER Working Papers 14671, National Bureau of Economic Research, Inc.
  8. Gertler, Paul & Locay, Luis & Sanderson, Warren, 1987. "Are user fees regressive? : The welfare implications of health care financing proposals in Peru," Journal of Econometrics, Elsevier, vol. 36(1-2), pages 67-88.
  9. Anthony T. LoSasso & Thomas C. Buchmueller, 2002. "The Effect of the State Children's Health Insurance Program on Health Insurance Coverage," NBER Working Papers 9405, National Bureau of Economic Research, Inc.
  10. McGuire, Thomas G. & Pauly, Mark V., 1991. "Physician response to fee changes with multiple payers," Journal of Health Economics, Elsevier, vol. 10(4), pages 385-410.
  11. Thomas G. McGuire & Mark V. Pauly, 1991. "Physician Response to Fee Changes with Multiple Payers," Papers 0015, Boston University - Industry Studies Programme.
  12. Anna Aizer, 2007. "Public Health Insurance, Program Take-Up, and Child Health," The Review of Economics and Statistics, MIT Press, vol. 89(3), pages 400-415, August.
  13. Gruber, Jonathan & Simon, Kosali, 2008. "Crowd-out 10 years later: Have recent public insurance expansions crowded out private health insurance?," Journal of Health Economics, Elsevier, vol. 27(2), pages 201-217, March.
  14. Sandra Decker, 2007. "Medicaid physician fees and the quality of medical care of Medicaid patients in the USA," Review of Economics of the Household, Springer, vol. 5(1), pages 95-112, March.
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