IDEAS home Printed from https://ideas.repec.org/a/kap/ijhcfe/v17y2017i3d10.1007_s10754-017-9211-2.html
   My bibliography  Save this article

The impact of health insurance expansion on physician treatment choice: Medicare Part D and physician prescribing

Author

Listed:
  • Tianyan Hu

    (Florida International University)

  • Sandra L. Decker

    (Agency for Healthcare Research and Quality (AHRQ))

  • Shin-Yi Chou

    (Lehigh University)

Abstract

We test the effect of the introduction of Medicare Part D on physician prescribing behavior by using data on physician visits from the National Ambulatory Medical Care Survey (NAMCS) 2002–2004 and 2006–2009 for patients aged 60–69. We use regression discontinuity designs to estimate the effect of part D around the age of 65 before and after 2006 and then compare the discrete jump in outcomes at age 65 before and after Part D. We find a 32% increase in the number of prescription drugs prescribed or continued per visit and a 46% increase in the number of generic drugs prescribed or continued for the elderly after the introduction of Medicare Part D.

Suggested Citation

  • Tianyan Hu & Sandra L. Decker & Shin-Yi Chou, 2017. "The impact of health insurance expansion on physician treatment choice: Medicare Part D and physician prescribing," International Journal of Health Economics and Management, Springer, vol. 17(3), pages 333-358, September.
    • Handle: RePEc:kap:ijhcfe:v:17:y:2017:i:3:d:10.1007_s10754-017-9211-2
    DOI: 10.1007/s10754-017-9211-2
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10754-017-9211-2
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s10754-017-9211-2?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Robert Kaestner & Cuping Schiman & G. Caleb Alexander, 2019. "Effects of Prescription Drug Insurance on Hospitalization and Mortality: Evidence from Medicare Part D," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 86(3), pages 595-628, September.
    2. Chalkley, Martin & Malcomson, James M., 1998. "Contracting for health services when patient demand does not reflect quality," Journal of Health Economics, Elsevier, vol. 17(1), pages 1-19, January.
    3. Mark Duggan & Fiona Scott Morton, 2010. "The Effect of Medicare Part D on Pharmaceutical Prices and Utilization," American Economic Review, American Economic Association, vol. 100(1), pages 590-607, March.
    4. Andrew J. Epstein & Jonathan D. Ketcham, 2014. "Information technology and agency in physicians' prescribing decisions," RAND Journal of Economics, RAND Corporation, vol. 45(2), pages 422-448, June.
    5. Gary V. Engelhardt & Jonathan Gruber, 2011. "Medicare Part D and the Financial Protection of the Elderly," American Economic Journal: Economic Policy, American Economic Association, vol. 3(4), pages 77-102, November.
    6. David S. Lee & Thomas Lemieux, 2010. "Regression Discontinuity Designs in Economics," Journal of Economic Literature, American Economic Association, vol. 48(2), pages 281-355, June.
    7. Imbens, Guido W. & Lemieux, Thomas, 2008. "Regression discontinuity designs: A guide to practice," Journal of Econometrics, Elsevier, vol. 142(2), pages 615-635, February.
    8. Blume-Kohout, Margaret E. & Sood, Neeraj, 2013. "Market size and innovation: Effects of Medicare Part D on pharmaceutical research and development," Journal of Public Economics, Elsevier, vol. 97(C), pages 327-336.
    9. Ellis, Randall P. & McGuire, Thomas G., 1986. "Provider behavior under prospective reimbursement : Cost sharing and supply," Journal of Health Economics, Elsevier, vol. 5(2), pages 129-151, June.
    10. Veronica Grembi & Tommaso Nannicini & Ugo Troiano, 2016. "Do Fiscal Rules Matter?," American Economic Journal: Applied Economics, American Economic Association, vol. 8(3), pages 1-30, July.
    11. David Card & Carlos Dobkin & Nicole Maestas, 2009. "Does Medicare Save Lives?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(2), pages 597-636.
    12. McGuire, Thomas G., 2000. "Physician agency," Handbook of Health Economics, in: A. J. Culyer & J. P. Newhouse (ed.), Handbook of Health Economics, edition 1, volume 1, chapter 9, pages 461-536, Elsevier.
    13. McCrary, Justin, 2008. "Manipulation of the running variable in the regression discontinuity design: A density test," Journal of Econometrics, Elsevier, vol. 142(2), pages 698-714, February.
    14. Feldstein, Martin S, 1970. "The Rising Price of Physicians' Services," The Review of Economics and Statistics, MIT Press, vol. 52(2), pages 121-133, May.
    15. Mark G. Duggan & Fiona Scott Morton, 2011. "The Medium-Term Impact of Medicare Part D on Pharmaceutical Prices," American Economic Review, American Economic Association, vol. 101(3), pages 387-392, May.
    16. Robert Kaestner & Nasreen Khan, 2012. "Medicare Part D and Its Effect on the Use of Prescription Drugs and Use of Other Health Care Services of the Elderly," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 31(2), pages 253-279, March.
    17. Lakdawalla, Darius & Sood, Neeraj & Gu, Qian, 2013. "Pharmaceutical advertising and Medicare Part D," Journal of Health Economics, Elsevier, vol. 32(6), pages 1356-1367.
    18. Weisbrod, Burton A, 1991. "The Health Care Quadrilemma: An Essay on Technological Change, Insurance, Quality of Care, and Cost Containment," Journal of Economic Literature, American Economic Association, vol. 29(2), pages 523-552, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Aslim, Erkmen Giray, 2022. "Public health insurance and employment transitions," Labour Economics, Elsevier, vol. 75(C).
    2. Matthew T. Knowles, 2022. "How access to addictive drugs affects the supply of substance abuse treatment: Evidence from Medicare Part D," Health Economics, John Wiley & Sons, Ltd., vol. 31(8), pages 1649-1675, August.
    3. Abraham Abebe Asfaw, 2019. "The effect of prescription drug insurance on health behavior: Evidence from Medicare Part D," Health Economics, John Wiley & Sons, Ltd., vol. 28(3), pages 403-418, March.
    4. Adolf Kwadzo Dzampe & Shingo Takahashi, 2022. "Competition and physician-induced demand in a healthcare market with regulated price: evidence from Ghana," International Journal of Health Economics and Management, Springer, vol. 22(3), pages 295-313, September.
    5. Bocong Yuan & Jiannan Li, 2019. "The Policy Effect of the General Data Protection Regulation (GDPR) on the Digital Public Health Sector in the European Union: An Empirical Investigation," IJERPH, MDPI, vol. 16(6), pages 1-15, March.
    6. Thomas M. Selden & Zeynal Karaca & Sandra Decker, 2018. "Has inpatient hospital treatment before and after age 65 changed as the difference between private and Medicare payment rates has widened?," International Journal of Health Economics and Management, Springer, vol. 18(4), pages 409-423, December.
    7. Ge Ge & Geir Godager & Jian Wang, 2022. "Exploring physician agency under demand‐side cost sharing—An experimental approach," Health Economics, John Wiley & Sons, Ltd., vol. 31(6), pages 1202-1227, June.
    8. DiNardi, Michael, 2021. "Aging out of the federal dependent coverage mandate and purchases of prescription drugs with high rates of misuse," Economics & Human Biology, Elsevier, vol. 43(C).
    9. Donghoon Lee & SangJune Kim & Jerome A. Dugan, 2024. "The effect of prescription drug insurance on the incidence of potentially inappropriate prescribing: Evidence from Medicare Part D," Health Economics, John Wiley & Sons, Ltd., vol. 33(1), pages 137-152, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Tianyan Hu & Sandra L. Decker & Shin-Yi Chou, 2014. "The Impact of Health Insurance Expansion on Physician Treatment Choice: Medicare Part D and Physician Prescribing," NBER Working Papers 20708, National Bureau of Economic Research, Inc.
    2. Mauricio Villamizar‐Villegas & Freddy A. Pinzon‐Puerto & Maria Alejandra Ruiz‐Sanchez, 2022. "A comprehensive history of regression discontinuity designs: An empirical survey of the last 60 years," Journal of Economic Surveys, Wiley Blackwell, vol. 36(4), pages 1130-1178, September.
    3. Nicolas Moreau & Elena Stancanelli, 2015. "Household Consumption at Retirement : A Regression Discontinuity Study on French Data," Annals of Economics and Statistics, GENES, issue 117-118, pages 253-276.
    4. Bäuml, Matthias & Kümpel, Christian, 2020. "Hospital responses to the introduction of reimbursements by treatment intensity in a (presumably lump sum) DRG system," hche Research Papers 22, University of Hamburg, Hamburg Center for Health Economics (hche).
    5. Patrick Hullegie & Tobias J. Klein, 2010. "The effect of private health insurance on medical care utilization and self‐assessed health in Germany," Health Economics, John Wiley & Sons, Ltd., vol. 19(9), pages 1048-1062, September.
    6. Kantorowicz, Jarosław & Köppl–Turyna, Monika, 2019. "Disentangling the fiscal effects of local constitutions," Journal of Economic Behavior & Organization, Elsevier, vol. 163(C), pages 63-87.
    7. Kantarevic, Jasmin & Kralj, Boris, 2014. "Risk selection and cost shifting in a prospective physician payment system: Evidence from Ontario," Health Policy, Elsevier, vol. 115(2), pages 249-257.
    8. Köppl–Turyna, Monika & Pitlik, Hans, 2018. "Do equalization payments affect subnational borrowing? Evidence from regression discontinuity," European Journal of Political Economy, Elsevier, vol. 53(C), pages 84-108.
    9. Angelo D'Andrea, 2019. "Mayor’s wage and Public procurement," BAFFI CAREFIN Working Papers 19125, BAFFI CAREFIN, Centre for Applied Research on International Markets Banking Finance and Regulation, Universita' Bocconi, Milano, Italy.
    10. Joshua D Gottlieb & Richard R Townsend & Ting Xu, 2022. "Does Career Risk Deter Potential Entrepreneurs?," The Review of Financial Studies, Society for Financial Studies, vol. 35(9), pages 3973-4015.
    11. Xi Chen, 2017. "Old age pension and intergenerational living arrangements: a regression discontinuity design," Review of Economics of the Household, Springer, vol. 15(2), pages 455-476, June.
    12. Nicolas Moreau & Elena Stancanelli, 2013. "Household Consumption at Retirement: A Regression Discontinuity Study on French," Documents de travail du Centre d'Economie de la Sorbonne 13072, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    13. Olivier Bargain & Delphine Boutin, 2021. "Minimum Age Regulation and Child Labor: New Evidence from Brazil," The World Bank Economic Review, World Bank, vol. 35(1), pages 234-260.
    14. Chen, Xi, 2015. "Old-Age Pension and Intergenerational Living Arrangements," IZA Discussion Papers 9482, Institute of Labor Economics (IZA).
    15. De Benedetto, Marco Alberto & De Paola, Maria & Scoppa, Vincenzo & Smirnova, Janna, 2023. "Erasmus Program and Labor Market Outcomes: Evidence from a Fuzzy Regression Discontinuity Design," IZA Discussion Papers 16181, Institute of Labor Economics (IZA).
    16. Ayyagari, Padmaja & Shane, Dan M., 2015. "Does prescription drug coverage improve mental health? Evidence from Medicare Part D," Journal of Health Economics, Elsevier, vol. 41(C), pages 46-58.
    17. Matias D. Cattaneo & Rocío Titiunik, 2022. "Regression Discontinuity Designs," Annual Review of Economics, Annual Reviews, vol. 14(1), pages 821-851, August.
    18. Nicolas Moreau & Elena Stancanelli, 2015. "Household Consumption at Retirement: A Regression Discontinuity Study on French Data," PSE-Ecole d'économie de Paris (Postprint) halshs-00881215, HAL.
    19. Sanzenbacher, Geoffrey T. & Wettstein, Gal, 2020. "Drug insurance and the strategic behavior of drug manufacturers: Evergreening and generic entry after Medicare Part D," Journal of Health Economics, Elsevier, vol. 72(C).
    20. Witman, Allison, 2015. "Public health insurance and disparate eligibility of spouses: The Medicare eligibility gap," Journal of Health Economics, Elsevier, vol. 40(C), pages 10-25.

    More about this item

    Keywords

    Medicare; Part D; Prescription drug; Expenditure of health care; Prescribing pattern;
    All these keywords.

    JEL classification:

    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:ijhcfe:v:17:y:2017:i:3:d:10.1007_s10754-017-9211-2. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.