Health Care Management Papers
Document Type
Journal Article
Date of this Version
1-2011
Publication Source
The B.E. Journal of Economic Analysis & Policy
Volume
11
Issue
2
Start Page
1
Last Page
30
DOI
10.2202/1935-1682.2719
Abstract
We evaluate the impact of the Medicare HMO program and prescription drug coverage on elderly mortality using data from 1993 to 2000. We specify a model of plan entry and benefit choice and Medicare enrollee plan choice and health outcomes. We derive an estimator that is consistent with endogenous plan selection by using the quasi-experimental variation caused by peculiarities of the Medicare reimbursement system for HMOs. We find that, relative to traditional Medicare, enrollment in an HMO without drug coverage increases mortality while enrollment in an HMO with drug coverage has no significant impact. The economic value of the reduction in mortality from drug coverage far outweighs the costs. HMOs, those without drug coverage in particular, attract healthier enrollees than average.
Keywords
healthcare, HMO, drug coverage
Recommended Citation
Gowrisankaran, G., Town, R., & Barrette, E. (2011). Managed Care, Drug Benefits and Mortality: An Analysis of the Elderly. The B.E. Journal of Economic Analysis & Policy, 11 (2), 1-30. http://dx.doi.org/10.2202/1935-1682.2719
Included in
Community Health Commons, Health Services Research Commons, Medical Education Commons, Other Public Health Commons
Date Posted: 27 November 2017
Comments
At the time of publication, author Robert J. Town was affiliated with the University of Minnesota. Currently, (s)he is a faculty member at the Wharton School at the University of Pennsylvania