Physician Payments and Infant Mortality: Evidence from Medicaid Fee Policy
While efforts to improve the health of the uninsured have focused on demand side policies such as increasing insurance coverage, supply side changes may be equally important. Yet there is little direct evidence on the effect of policies designed to increase the supply of Medicaid services to the poor. We provide such evidence by examining the relationship between infant mortality and the ratio of Medicaid fees to private fees for obstetrician/gynecologists. We build a state and year specific index of the fee ratio for 1979-1992, a period of substantial variation in relative Medicaid fees. We find that increases in fee ratios are associated with significant declines in the infant mortality rate. We also find that higher fees raise payments made to physicians and clinics under the Medicaid program, but reduce payments to hospitals. Finally, we compare the cost effectiveness of reducing infant mortality by increasing fee ratios to the efficacy of reducing mortality by expanding the Medicaid eligibility of pregnant women. Although our results are sensitive to the time period used, we conclude that raising fee ratios is at least as cost effective as increasing eligibility.
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Volume (Year): 85 (1995)
Issue (Month): 2 (May)
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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Gruber, J. & Currie, J., 1994.
"Saving Babies: The Efficacy and Cost of Recent Expansions of Medicaid Eligibility for Pregnant Women,"
94-11, Massachusetts Institute of Technology (MIT), Department of Economics.
- Janet Currie & Jonathan Gruber, 1994. "Saving Babies: The Efficacy and Cost of Recent Expansions of Medicaid Eligibility for Pregnant Women," NBER Working Papers 4644, National Bureau of Economic Research, Inc.
- Michael Grossman & Theodore J. Joyce, 1991.
"Unobservables, Pregnancy Resolutions, and Birthweight Production Functions in New York City,"
NBER Working Papers
2746, National Bureau of Economic Research, Inc.
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- Hope Corman & Theodore J. Joyce & Michael Grossman, 1987. "Birth Outcome Production Function in the United States," Journal of Human Resources, University of Wisconsin Press, vol. 22(3), pages 339-360.
- Mark R. Rosenzweig & T. Paul Schultz, 1988. "The Stability of Household Production Technology: A Replication," Journal of Human Resources, University of Wisconsin Press, vol. 23(4), pages 535-549.
- Cropper, Maureen L & Oates, Wallace E, 1992. "Environmental Economics: A Survey," Journal of Economic Literature, American Economic Association, vol. 30(2), pages 675-740, June.
- Hope Corman & Theodore J. Joyce & Michael Grossman, 1985. "Birth Outcome Production Functions in the U.S," NBER Working Papers 1729, National Bureau of Economic Research, Inc.
- Mark R. Rosenzweig & T. Paul Schultz, 1982. "The Behavior of Mothers as Inputs to Child Health: The Determinants of Birth Weight, Gestation, and Rate of Fetal Growth," NBER Chapters, in: Economic Aspects of Health, pages 53-92 National Bureau of Economic Research, Inc.
- Cropper, Maureen L. & William N. Evans & Stephen J. Berard & Maria M. Ducla-Soares & Paul R. Portney, 1992. "The Determinants of Pesticide Regulation: A Statistical Analysis of EPA Decision Making," Journal of Political Economy, University of Chicago Press, vol. 100(1), pages 175-97, February.
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