Three Essays in Applied Health Economics

Abstract

The US healthcare system faces numerous challenges. In this dissertation I study issues of access to care, healthcare costs, and responses to the opioid epidemic. I take an applied economic approach, using causal inference methods to examine the effects of recent policies and changes to landscape of healthcare providers.

In the first chapter, I study urgent care centers (UCCs), which provide timely care for nonchronic, low-severity health conditions. Over the past decade, UCCs have disrupted the market for outpatient healthcare. The entry of these new providers may reduce healthcare spending by diverting care from higher cost emergency departments. Alternatively, if UCC entry increases healthcare utilization, total spending may increase. I use administrative insurance claims data from Massachusetts to estimate the effect of UCC entry on healthcare utilization and spending. The data span 2012 to 2015, during which the number of UCCs increased by 88 percent. In the months immediately following UCC entry, patients substitute away from other outpatient providers. Patients substantially reduce visits to physician offices and outpatient clinics, and slightly reduce visits to emergency departments. Overall, UCC entry increases the efficiency of the healthcare system. Aggregate spending appears to modestly decline, while in areas with few primary care providers, UCC entry increases the total number of healthcare visits.

The second chapter examines the effect of insurance coverage on utilization of prescription drugs that treat ADHD. It uses a regression discontinuity design that exploits the change in eligibility for dependent insurance coverage at age 26. From 2014-2017, the probability of insurance coverage decreased by 5 percentage points at this threshold. I examine the effect on central nervous system stimulant expenditures using an administrative database that captures all prescriptions filled at Kentucky pharmacies. At the eligibility threshold, the probability of purchasing a prescription drops by 5-7 percentage points and expenditures fall by 18-27 percent. Only 30 percent of the decrease in prescriptions purchased with insurance is offset by an increase in prescriptions purchased out-of-pocket. People also decrease expenditures by switching from branded medications to a category of similar generics that costs $104 (43 percent) less per prescription. The probability of filling a prescription recovers as people regain insurance, but decreases in expenditures persist longer-term.

The third chapter studies opioid control policies that target the prescribing behavior of health care providers. In this chapter, (co-authored by Thomas Buchmueller and Colleen Carey), we study the first comprehensive state-level policy requiring providers to access patients' opioid history before making prescribing decisions. We compare prescribers in Kentucky, which implemented this policy in 2012, to those in a control state, Indiana. Our main difference-in-differences analysis uses the universe of prescriptions filled in the two states to assess how the information provided affected prescribing behavior. We find that a significant share of low-volume providers stopped prescribing opioids altogether after the policy was implemented, though this change accounted for a small share of the reduction in total volume. The most important margin of response was to prescribe opioids to fewer patients. While providers disproportionately discontinued treating patients whose opioid histories showed the use of multiple providers, there were also economically-meaningful reductions for patients without multiple providers and single-use acute patients.