Journal of health economics
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Several studies have examined the effects of state cigarette tax increases on youth substance use over the 1990s, with most--but not all--finding that higher taxes reduce youth consumption of tobacco. We advance the literature by using data from the 1991 to 2005 waves of the national Youth Risk Behavior Surveys (YRBS), providing information on over 100,000 high school age youths. We also are the first to make use of hundreds of independently fielded state and local versions of the YRBS, reflecting data from over 750,000 youths. ⋯ We estimate two-way fixed effects models of the effect of state cigarette taxes on youth smoking, controlling for survey demographics and area and year fixed effects. Our most consistent finding is that--contrary to some recent research--the large state tobacco tax increases of the past 15 years were associated with significant reductions in smoking participation and frequent smoking by youths. Our price elasticity estimates for smoking participation by high school youths are generally smaller than previous cross-sectional approaches but are similar to recent quasi-experimental estimates.
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We present a dynamic general equilibrium model of the U. S. economy and the medical sector in which the adoption of new medical treatments is endogenous and the demand for medical services is conditional on the state of technology. We use this model to prepare 75-year medical spending forecasts and a projection of the Medicare actuarial balance, and we compare our results to those obtained from a method that has been used by government actuaries. Our baseline forecast predicts slower health spending growth in the long run and a lower Medicare actuarial deficit relative to the previous projection methodology.
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We consider a therapeutic market with potentially three pharmaceutical firms. Two of the firms offer horizontally differentiated brand-name drugs. One of the brand-name drugs is a new treatment under patent protection that will be introduced if the profits are sufficient to cover the entry costs. ⋯ We show that competition is strongest under TRP, resulting in the lowest drug prices (and medical expenditures). However, TRP also provides the lowest profits to the patent-holding firm, making entry of the new drug treatment least likely. Surprisingly, we find that GRP distorts drug choices most, exposing patients to higher health risks.
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We study how for-profit and religious nonprofit hospices respond to an exogenous Medicare reimbursement incentive that encourages maximization of patient length of stay. Hospices have the incentive to selectively admit patients with longer expected lengths of stay, and admit patients sooner after a hospital discharge. ⋯ We do not find any difference in the timing of admission by ownership. Incentives for efficiency could be strengthened by a Medicare pricing system that replaced the current flat per diem payment with one that reflected the high costs at the beginning and end of hospice stay and the lower costs in between.
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This paper analyses hospitals' decisions regarding the supply of elective surgery in a dynamic model in the presence of waiting times and waiting lists. We show that periods of increasing (decreasing) supply and increasing (decreasing) waiting list may be optimal paths towards the steady state. We also analyse the hospitals' response to exogenous shocks on the demand and the supply. For example, an increase in the marginal tariff for the provider generates overshooting in the supply: supply jumps upwards when the shock is introduced and then slowly reduces towards the steady-state value.