Effectively designed market mechanisms may reduce growth in health care spending. In this paper, we study the impact of privatizing the delivery of Medicaid drug benefits on drug spending. Exploiting granular data that allow us to examine drug utilization, we find that drug spending would fall...

In February 2009 the U.S. Congress unexpectedly passed the Health Information Technology for Economic and Clinical Health Act (HITECH). HITECH provides up to $27 billion to promote adoption and appropriate use of Electronic Medical Records (EMR) by hospitals. We measure the extent to which...

The costs and benefits of hospice and palliative care have recently received attention for many compelling reasons. First, the cost of medical care over a lifetime is largely expended near the end-of-life. The impending demographic bulge of aging baby boomers will only heighten concerns about...

During the late 1990s, China introduced the gaizhi process for privatizing state-owned firms. Under gaizhi, managers could acquire their firms at a price that was based on recent profitability. Systematic analysis of longitudinal data reveals the following: (1) There is a statistically...

This paper explores the economic incentives for medical procedure innovation. Using a proprietary dataset on billing code applications for emerging medical procedures, we highlight two mechanisms that could hinder innovation. First, the administrative hurdle of securing permanent, reimbursable...

We call markets in which intermediaries sell networks of suppliers to consumers who are uncertain about their needs "option demand markets." In these markets, suppliers may grant the intermediaries discounts in order to be admitted to their networks. We derive a measure of each supplier's market...

Prior research has shown that exogenous shocks to the demand for medical products spur additional product development. These studies do not distinguish between breakthrough products and those that largely duplicate the performance of existing products. In this paper, we use a novel data set to...

The willingness of individuals to engage in a harmful act may be influenced by direct personal experiences and the experiences of others, which can inform individuals about the likely consequences of their actions. In this paper, we examine how obstetricians respond to litigation. It is...

During the 1990s, a record number of U.S. hospitals entered into some form of vertical combination with physicians. During the same period, many integrated hospital-physician arrangements broke up. Using data from California, we investigate whether such vertical activity affected hospital...