William & Mary faculty are actively involved in health policy research. Their work has been published in books and peer-reviewed academic journals and is distributed as working papers. Below are summaries and abstracts of scholarly research published by William & Mary faculty.
"Medicare Payment and Hospital Provision of Outpatient Care to the Uninsured" by Daifeng He and Jennifer M. Mellor. Health Services Research, DOI: 10.1111/1475-6773.12433, 2016.
In this study, Schroeder Center faculty affiliates Daifeng He and Jennifer Mellor examine how Medicare payment cuts affect the amount of outpatient care provided to the uninsured generally and by non-profit and for-profit hospitals specifically. Effective in 2000, the Hospital Outpatient Prospective Payment System (OPPS) created a new payment system, whereby predetermined payment rates were assigned to all procedures in a given group of outpatient procedures. Prior research demonstrates that the OPPS ultimately reduced average Medicare payments for certain outpatient procedures. Using Medicare reimbursement rates for the 10 most commonly used hospital outpatient surgical procedures and more than 10 years of hospital outpatient discharge records from one state, He and Mellor find that the OPPS-induced Medicare payment cuts clearly affected the provision of care to the uninsured. Between 2004 and 2008, for example, the number of uninsured patients seen on an outpatient basis decreased by nearly 11,300 patients. In non-profit hospitals in particular, He and Mellor find that the Medicare payment cuts resulted in providing decreased care (as measured by total charges and share of charges) to the uninsured. Specifically, they found that a 1% decrease in the Medicare payment measure is associated with a decrease of $20,200 on average in annual outpatient care charges for the uninsured at non-profit hospitals. These findings suggest that further Medicare reimbursement rate cuts, including those associated with the full implementation of the Affordable Care Act, may result in uninsured individuals experiencing a decline in outpatient services provided by hospitals.
"Does Formal Employment Reduce Informal Caregiving?" by Daifeng He and Peter McHenry. Health Economics, DOI: 10.1002/hec. 3185, 2015.
In the United States, the elderly frequently rely on informal care providers, such as family members and friends, to assist them as they age, but many of these providers – most of whom are women – face competing demands for their limited time as a result of formal employment arrangements. Using the large nationally representative Survey of Income and Program Participation (SIPP) dataset, He and McHenry quantify the causal effect of women’s formal employment on their ability to provide informal care. They note that about 8% of women ages 40-64 years provide informal care, and the average time devoted to caregiving is 2.3 hours weekly. Among those actually providing care, average weekly caregiving is 28 hours. He and McHenry find that formal employment reduces the probability of caregiving. Among women of prime caregiving age, for example, working 10% more hours per week reduces the probability of providing informal care by about 2 percentage points. If the care recipient is a household member or the care itself is more time-intensive, the effect of formal employment on caregiving is even stronger. These results suggest that there will be continuing strains on the long-term care infrastructure in the United States, with work-promoting policies having the unintended consequence of reducing informal caregiving in an aging society.
“Physician Responses to Rising Local Unemployment Rates: Healthcare Provision to Medicare and Privately Insured Patients” by Daifeng He, Melissa McInerney, and Jennifer Mellor. Journal of Health Economics, 40:97-108, 2015.
This study, published in the March 2015 issue of the Journal of Health Economics, is the first physician-level analysis of changes in the provision of healthcare to Medicare and privately insured patients across the business cycle. Using Florida discharge data from hospitals and ambulatory surgery centers between 1998-2010, the authors find that, on average, as county unemployment rates increase, physicians treat fewer privately insured patients in both inpatient and outpatient settings. This procyclical response is explained by higher unemployment rates reducing private health insurance coverage and income among patients, thereby reducing demand for healthcare. However, the average physician does not provide any less inpatient care to Medicare fee-for-service patients as unemployment rates rise. Instead, He, McInerney, and Mellor find that physicians who have a greater proportion of patients with private insurance provide more care to Medicare patients as the unemployment rate rises. This response is a form of physician-induced demand in which physicians induce utilization among their continuously insured patients to offset income losses.
"Childhood Health and Sibling Outcomes: The Shared Burden and Benefit of the 1918 Influenza Pandemic" by John Parman, NBER Working Paper Number 19505, 2013.
In an October 2013 study released as part of the National Bureau of Economic Research’s (NBER’s) Working Paper Series, William & Mary economist and Schroeder Center for Health Policy faculty affiliate John Parman examines how families allocate their resources when there is a health shock to one of their children. In particular, Parman uses the 1918 influenza pandemic to determine if a negative health shock for one child will have educational and health consequences for that child’s siblings. Given the potential impact of a family’s response to such an event, Parman’s study suggests that childhood health interventions may have unintended consequences for the healthy siblings of a sick child. Understanding how households reallocate resources in response to health shocks is therefore critical to predicting the net effects of health interventions on health and educational outcomes.
To study sibling effects, Parman linked adult education and health information from military enlistment records to childhood household information in the 1930 federal census. In terms of educational attainment, Parman reports that “while the pandemic was a burden on children exposed in utero, it was actually a benefit to their older siblings.” Parman’s study finds that “[i]ndividuals achieved greater educational attainments [an additional quarter year of education] if a younger sibling was in utero during the pandemic and experienced small reductions in educational attainment if an older sibling was in utero during the pandemic.” In terms of health consequences, however, the reallocation of family resources in response to the pandemic “did not impact the net nutrition or health of siblings in a way that translated into differences in attained height.”
Parman presented this research at various forums, including the annual meetings of the Population Association of America and the NBER Summer Institute meetings for the Development of the American Economy program.
"Recession Depression: Mental Health Effects of the 2008 Stock Market Crash" by Melissa McInerney, Jennifer M. Mellor, and Lauren H. Nicholas. Journal of Health Economics, 32(6): 1090-1104, 2013.
A study published in the December 2013 issue of the Journal of Health Economics provides new evidence on the link between wealth and health. In “Recession Depression: Mental Health Effects of the 2008 Stock Market Crash,” Melissa McInerney, Jennifer M. Mellor, and Lauren Hersch Nicholas examined if sudden, large wealth losses had a causal effect on mental health. While prior studies had showed that increases in income, such as from winning the lottery, lead to mental health improvements, the mental health effects of losing money were not known. Given the frequency of significant income losses within families resulting from divorce, death of one’s spouse, and costly medical treatment, for example, the immediate mental health consequences of wealth losses are important to understand. This is particularly true as many states and the federal government increase funding to improve access and the quality of mental health services.
McInerney, Mellor, and Nicholas looked at large wealth losses resulting from the 2008 stock market crash, and compared mental health changes over a period of two years using participants in the Health and Retirement Study, or HRS. They also compared participants whose second interview took place just before the crash to another group of participants whose second interview took place after the crash. They report that respondents who were exposed to the crash experienced increased feelings of depression and use of antidepressant drugs following the crash. These effects were the greatest for respondents who experienced the highest stock market exposure. Individuals with the largest losses, for example, report about a 50% increase in feelings of depression following the 2008 stock market crash. However, while the study authors found that the stock market crash affected self-reported feelings of depression, it did not result in increases in clinical depression.
Mellor is a faculty member in the Department of Economics at William & Mary and Director of the Schroeder Center for Health Policy; McInerney is an economics faculty member at Tufts University; and Nicholas is an economist at Johns Hopkins Bloomberg School of Public Health. Their study was funded by the Russell Sage Foundation’s 2011 Special Initiative on the Social and Economic Effects of the Great Recession, the National Institute on Aging, and William & Mary’s Schroeder Center for Health Policy.
"Do Changes in Hospital Outpatient Payments Affect the Setting of Care?" by Daifeng He and Jennifer M. Mellor. Health Services Research, 48(5): 1593-1616, 2013.
In a study published in the October 2013 issue of Health Services Research, Schroeder Center for Health Policy faculty affiliates Daifeng He and Jennifer M. Mellor examined whether changes in Medicare reimbursement for outpatient services under the Outpatient Prospective Payment System (OPPS) have the unintended consequence of moving outpatient care to the inpatient setting. Effective in August 2000, the OPPS reduced hospital reimbursements for many outpatient services provided to Medicare beneficiaries, in part to contain rising healthcare costs. If, as He and Mellor questioned, outpatient reimbursement rate cuts shift care toward the much more expensive inpatient setting, then the cost-saving potential of OPPS could be greatly limited.
In the first study to address the question, He and Mellor used inpatient and outpatient discharge files from 200 Florida hospitals over a period of 12 years before and after OPPS. They focused their analysis on inguinal hernia repair surgery, one of the most common surgeries in the U.S. The study authors found that while the volume of outpatient hernia surgeries fell as a result of OPPS rate cuts, surgeries did not shift to the inpatient setting. He and Mellor conclude that “the substitution of inpatient care for outpatient care does not pose a serious threat to efforts to contain costs through OPPS.”
This study was funded by the Robert Wood Johnson Foundation’s Changes in Healthcare Financing and Organization (HCFO) initiative and William & Mary’s Schroeder Center for Health Policy. Mellor presented the study at AcademyHealth’s 2013 Annual Research Meeting, the premier forum for health services research.
"Racial and Ethnic Disparities in the Surgical Treatment of Acute Myocardial Infarction: The Role of Hospital and Physician Effects" by Daifeng He, Jennifer Mellor, and Eytan Jankowitz. Medical Care Research & Review, 70(3): 287-309, 2013.
Many studies document disparities between blacks and whites in the treatment of acute myocardial infarction (AMI). Other studies provide evidence of disparities between Hispanics and whites in cardiac care. Such disparities may be explained by differences in the hospitals where minority and non-minority patients obtain treatment and by differences in the traits of physicians who treat minority and non-minority patients. He, Mellor, and Jankowitz used Florida hospital inpatient discharge data to estimate models of cardiac catheterization, percutaneous transluminal coronary angioplasty (PTCA), and coronary artery bypass grafting (CABG) in Medicare fee-for-service patients age 65 and up. They find that controlling for hospital fixed effects does not explain black-white disparities in cardiac treatment, but largely explains Hispanic-white disparities.
"State Unemployment In Recessions During 1991–2009 Was Linked To Faster Growth In Medicare Spending" by Melissa McInerney and Jennifer M. Mellor. Health Affairs, 31(11): 2464-2473, 2012.
During the U.S. recession of 2007–09, overall health care spending growth fell, but Medicare spending growth increased. Using state-level data from the period 1991-2009, we show that these divergent trends were also observed within states. Furthermore, increases in state unemployment rates were associated with higher Medicare spending per capita and increased hospital use by Medicare beneficiaries. For example, a one-percentage-point point rise in the unemployment rate was associated with a $40 (0.7 percent) increase in Medicare spending per capita. Our results suggest that economic downturns contribute to Medicare spending and use. There are a number of possible explanations, but one may be that health care providers have greater capacity, inclination and financial incentive to treat Medicare patients during recessions due to slackening demand from the non-Medicare population.
"Recessions and Seniors’ Health; Health Behaviors; and Healthcare Use: Analysis of the Medicare Current Beneficiary Survey," by Melissa McInerney and Jennifer M. Mellor. Journal of Health Economics, 31(5): 744-751, 2012.
A number of studies report that U.S. state mortality rates, particularly for the elderly, decline during economic downturns. Further, several prior studies use microdata to show that as state unemployment rates rise, physical health improves, unhealthy behaviors decrease, and medical care use declines. We use data on elderly mortality rates and data from the Medicare Current Beneficiary Survey from a time period that encompasses the start of the Great Recession. We find that elderly mortality is countercyclical during most of the 1994 to 2008 period. Further, as unemployment rates rise, seniors report worse mental health and are no more likely to engage in healthier behaviors. We find suggestive evidence that inpatient utilization increases perhaps because of an increased physician willingness to accept Medicare patients. Our findings suggest that either elderly individuals respond differently to recessions than do working age adults, or that the relationship between unemployment and health has changed.
"Hospital Volume Responses to Medicare's Outpatient Prospective Payment System: Evidence from Florida," by Daifeng He and Jennifer M. Mellor. Journal of Health Economics, 31(5): 730-743, 2012.
Effective in 2000, Medicare's Outpatient Prospective Payment System (OPPS) sets pre-determined reimbursement rates for hospital outpatient services, replacing the prior cost-based methods of reimbursement. Using Florida outpatient discharge data, we study the effect of OPPS on hospital outpatient volume. We find that on average Medicare rate cuts either decreased or had no significant effect on Medicare volume, but increased private fee-for-service (FFS) volume. We also find that responses vary with the hospital's “exposure” to Medicare payment changes, where exposure is measured as the baseline Medicare patient share. Compared to less exposed hospitals, highly exposed hospitals responded with larger increases in private FFS volume and with smaller decreases (in some cases, even increases) in Medicare volume when payment rates fell. Our results are consistent with provider demand inducement.
“Identifying Barriers to Care for Older Adults with Substance Use Disorders and Cognitive Impairments” by Christine J. Jensen, Herman R. Lukow, and Andrew L. Heck. Alcoholism Treatment Quarterly, 30: 211-223, 2012.
Some substance use disorders in older adults may be better conceptualized as hazardous use that is sometimes unintentional and affected by other mental health conditions, including dementia. This study identified (1) the types of substances older adults are abusing, (2) how the disorders are linked to dementia and other mental health issues, and (3) barriers to screening and treatment.
"Child Body Mass Index, Obesity, and Proximity to Fast Food Restaurants," by Jennifer M. Mellor, Carrie B. Dolan, and Ronald Rapoport. International Journal of Pediatric Obesity, 6(1): 60-68, February 2011.
Using a sample of elementary and middle school students, the authors examined the associations between body mass index (BMI), obesity, and measures of the proximity of fast food and full service restaurants to students ' residences. Socioeconomic status was controlled for using a novel proxy measure based on housing values. The authors found that students residing in homes with higher assessment values were significantly less likely to be obese and had significantly lower BMIs. Upon controlling for socioeconomic status and other characteristics, the associations of BMI and obesity with proximity to food service establishments were reduced. Nonetheless, students who resided within one-tenth or one-quarter of a mile from a fast food restaurant had significantly higher values of BMI. The proximity of full service restaurants to residences did not have a significant positive association with either BMI or overweight. Therefore, public health efforts to limit access to fast food among nearby residents could have beneficial effects on child obesity. Public data on property value assessments may serve as useful approximations for socioeconomic status when address data are available.
"Do Cigarette Taxes Affect Children's Body Mass Index? The Effect of Household Environment on Health," by Jennifer M. Mellor. Health Economics, 20(4): 417-431, April 2011.
Several recent studies demonstrate a positive effect of cigarette prices and taxes on obesity among adults, especially those who smoke. If higher cigarette costs affect smokers' weights by increasing calories consumed or increasing food expenditures, then cigarette taxes and prices may also affect obesity in children of smokers. This study examines the link between child body mass index (BMI) and obesity status and cigarette costs using data from the National Longitudinal Survey of Youth-79 (NLSY79). Controlling for various child, mother, and household characteristics as well as child-fixed effects, the authors find that cigarette taxes and prices increase BMI in the children of smoking mothers. Interestingly, and unlike previous research findings for adults, higher cigarette taxes do not increase the likelihood of obesity in children. These findings are consistent with a causal mechanism in which higher cigarette costs reduce smoking and increase food expenditures and consumption in the household.
"Is there Dynamic Adverse Selection in the Life Insurance Market?" by Daifeng He. Economics Letters, 112: 113-115, 2011.
This paper finds evidence of dynamic adverse selection in the life insurance market. Lower-risk individuals are more likely to cancel a policy, and to cancel one of greater face value conditional on cancellation, than are individuals with higher mortality risk.
“The Effect of State Workers' Compensation Program Changes on the Use of Federal Social Security Disability Insurance” by Melissa P. McInerney and Kosali I. Simon. NBER Working Paper No. 15895, April 2010.
In addition to traditional forms of private and public medical insurance, two other large programs help pay for costs associated with ill health – Workers Compensation (WC) insurance and Social Security Disability Insurance (DI). During the 1990s, real DI outlays increased nearly 70 percent, whereas real WC cash benefit spending fell by 12 percent. There has been concern that part of this relationship between two of the nation’s largest social insurance programs may be due to individuals substituting towards DI as state WC policies tightened. McInerney and Simon test this hypothesis using a number of different WC and DI program parameters and find no compelling evidence of WC tightening causing DI rolls to increase, and conclude it is unlikely that state WC changes were a meaningful factor in explaining the rise in DI.
"Religious Participation and Risky Behaviors among Adolescents," by Jennifer M. Mellor and Beth A. Freeborn. Health Economics, 20(10): 1226-1240, October 2010.
Previous studies have shown that adolescent religious participation is negatively associated with risky health behaviors like cigarette smoking, alcohol consumption, and illicit drug use. But does religion directly reduce risky behaviors, or are both religious participation and risky health behaviors driven by some common unobserved individual trait? This study uses data from the National Longitudinal Study of Adolescent Health and implements an instrumental variables approach to identify the effect of religious participation on smoking, binge drinking and marijuana use.
"The Life Insurance Market: Asymmetric Information Revisited," by Daifeng He. Journal of Public Economics, 93: 1090-1097, 2009. (Earlier versions distributed under the title "The Life Insurance Market: Adverse Selection Revisited.")
This paper finds evidence for the presence of asymmetric information in the life insurance market, a conclusion contrasting with the existing literature. In particular, He finds a significant and positive correlation between the decision to purchase life insurance and subsequent mortality, conditional on risk classification. Individuals who died within a 12-year time window were 19 percent more likely to have taken up life insurance than were those who survived the time window. Moreover, as might be expected when individuals have residual private information, He finds that the earlier an individual died, the more likely she was to have initially bought insurance.
"Tax Incentives and the Decision to Purchase Long-term Care Insurance" by Charles Courtemanche and Daifeng He. Journal of Public Economics, 93: 296-310, 2009.
This paper studies the impact of the tax incentive prescribed in the Health Insurance Portability and Accountability Act of 1996 (HIPAA) on individuals’ long-term care (LTC) insurance purchasing behavior. Using data from the Health and Retirement Study, Courtemanche and He find that the tax incentive in HIPAA increased the take-up rate of private LTC insurance by 3.3 percentage points, or 25%, for those eligible. Despite this seemingly strong response, their results imply that even an above-the-line tax deduction would not increase the coverage rate of seniors beyond 13%, indicating that tax incentives alone are unlikely to expand the market substantially. Finally, they evaluate the net fiscal impact of the tax incentive and find that the tax deductibility of LTC insurance premiums leads to a net revenue loss for the government, as the reduced tax revenue from granting the tax incentive exceeds the savings in Medicaid’s LTC expenditures.
"Predicting Health Behaviors with an Experimental Measure of Risk Preference," by Lisa R. Anderson and Jennifer M. Mellor. Journal of Health Economics, 27(5): 1260-1274, September 2008.
Despite the importance of individual-specific risk preference in decision-making, there is no consensus on how best to measure it in order to control for its contribution to economic and health behaviors. This study reports on a large-scale economics experiment paired with a survey. The authors examine the association between an experimental measure of individual risk preference and health-related behaviors among adults aged 18 to 87 years. Controlling for subject demographic and economic characteristics, the experimental measure of risk aversion is negatively and significantly associated with cigarette smoking, heavy drinking, being overweight or obese, and seat belt non-use.
Magnetic Appeal: MRI and the Myth of Transparency, by Kelly A. Joyce, Cornell University Press, 2008.
This book investigates popular perceptions of MRI and the technology's use in clinical medicine. Building on a co-production framework, Joyce shows how ideas about mechanically-produced pictures, fee-for-service insurance reimbursements, definitions of evidence, advertising, concerns about litigation, and decreasing clinical exam times all help make MRI the right tool for diagnostic work.
Joyce was a faculty member in Sociology at William & Mary when she published this book. Joyce is now the Director for the Master's Program in Science, Technology & Society at Drexel University.
"The Role of Medicaid" by Alan R. Weil and Louis F. Rossiter, in Restoring Fiscal Sanity 2007: The Health Spending Challenge. Alice M. Rivlin and Joseph R. Antos, eds., The Brookings Institution Press, 2007.
Any serious efforts to control the federal budget must include Medicaid. While much Medicaid spending is driven by the same factors that are increasing overall healthcare spending, namely advances in medical technology and increasing needs of the population, some cost pressures are unique. This study examines these unique forces that contribute to Medicaid's spending growth, and what might be done about them.
“Community Assessment of Senior Health Using a Telephone Survey and Supplementary Methods” by Christine J. Jensen., David H. Finifter, Carol E. Wilson, and Bryan L. Koenig. Journal of Applied Gerontology, 26: 17-33, 2007.
Because of the dramatic growth in the senior population, a community's assessment of the health needs of its older adults has become increasingly important. Telephone surveys have been routinely used to assess a variety of senior issues. This article supports the assertion made by the authors that supplementary evaluation of especially informative subgroups is valuable for a comprehensive characterization of the health of community-residing seniors.