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Do the Medicaid and Medicare programs compete for access to health care services? A longitudinal analysis of physician fees, 1998–2004

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  • Larry Howard

Abstract

As the demand for publicly funded health care continues to rise in the U.S., there is increasing pressure on state governments to ensure patient access through adjustments in provider compensation policies. This paper longitudinally examines the fees that states paid physicians for services covered by the Medicaid program over the period 1998–2004. Controlling for an extensive set of economic and health care industry characteristics, the elasticity of states’ Medicaid fees, with respect to Medicare fees, is estimated to be in the range of 0.2–0.7 depending on the type of physician service examined. The findings indicate a significant degree of price competition between the Medicaid and Medicare programs for physician services that is more pronounced for cardiology and critical care, but not hospital care. The results also suggest several policy levers that work to either increase patient access or reduce total program costs through changes in fees. Copyright Springer Science+Business Media New York 2014

Suggested Citation

  • Larry Howard, 2014. "Do the Medicaid and Medicare programs compete for access to health care services? A longitudinal analysis of physician fees, 1998–2004," International Journal of Health Economics and Management, Springer, vol. 14(3), pages 229-250, September.
  • Handle: RePEc:kap:ijhcfe:v:14:y:2014:i:3:p:229-250
    DOI: 10.1007/s10754-014-9146-9
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    References listed on IDEAS

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    Cited by:

    1. Justin B. Bullock & W. David Bradford, 2016. "The differential effect of compensation structures on the likelihood that firms accept new patients by insurance type," International Journal of Health Economics and Management, Springer, vol. 16(1), pages 65-88, March.

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    More about this item

    Keywords

    Physician fees; Health care; Medicaid; Medicare; Federal state; H51; H77; I18; I38;
    All these keywords.

    JEL classification:

    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

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