Category: Health Economics

Doctors who care for the poor: Paying the hidden cost of Medicaid

A groundbreaking study has finally put a dollar figure on a previously unanswered question: how much do physicians’ practices, due to government regulation, pay to ensure their poorest patients get the right prescription drugs? Turns out the answer is $8.02 per prescription, on average, or $1,110 annually for high blood pressure and high cholesterol medications alone, according to research from Jonathan D. Ketcham, an assistant professor at the W. P. Carey School of Business, and Andrew J. Epstein, an assistant professor at the Yale School of Medicine.

VEBAs: Autoworkers’ union shares the risk of rising health care costs

The tentative contract agreement that assigned a role to the United Auto Workers in managing the healthcare costs of its General Motors members was a turning point in the relationship between business and labor — and a sign of things to come in a global economy. In fact, Chrysler was seeking similar healthcare concessions in contract talks with the union. It’s all about risk-sharing. VEBAs — Voluntary Employee Beneficiary Associations — will most likely make declining U.S. manufacturing industries more competitive; however, they may do little to reverse sagging U.S. union participation, according to experts at the W. P. Carey School of Business.

Biologic drugs a good buy in U.S.

The soaring cost of prescription drugs is a major concern in the United States, but drugs in one important category — biopharmaceuticals, or drugs produced through biotechnology — actually do not cost more in the United States. Michael F. Furukawa, assistant professor in the School of Health Management and Policy at the W. P. Carey School of Business, and his co-author found that while the United States is by far the biggest user of biopharmaceuticals, the prices for these drugs in the United States are comparable to those in a broad range of countries.

Podcast: Managing the business of health care

Peter Drucker, sometimes called the father of modern management, once commented that health care organizations are the most difficult to manage of all organizations. For example, American health care is defined by legislative mandate yet implemented in the private sector. Further complicating the system is the fact that the majority of physicians who deliver hospital care are independent contractors and not employees of the hospitals. Indeed, clinicians at all levels need management skills, not only to navigate Medicaid and Medicare regulations, but also to build and operate new programs. The W. P. Carey School’s David Patton, professor of practice in the School of Health Management and Policy, is teaching a series of courses designed to introduce these skills to physicians, nursing executives and others who run this complex system.

Economists are from Mars, policymakers are from Venus: Translating the language of science

While many scientists applaud former Vice President Al Gore and his documentary, "An Inconvenient Truth," some scientists have said that the film exaggerates the nature of environmental problems and/or makes conclusions that the science doesn’t uphold. Part of the problem may be that scientists and policymakers don’t speak the same language. The controversy highlights an enduring problem: how to translate the highly specialized language of science. The 18th Annual Health Economics Conference hosted by the School of Health Management and Policy at the W. P. Carey School of Business recently tackled this problem in the context of health policy.

Consumer preferences and the relationship between health and consumption

In an ideal world, consumers’ choices in relation to the incremental costs of producing goods and services would dictate what gets produced, and at what price. Choices should tell us about preferences. But it’s not an ideal world and it is harder for analysts to uncover preferences when there are arbitrary, institutionally-imposed, incentives or distorted messages. In his keynote presentation at the 18th Annual Health Economics Conference, W. P. Carey Economics Professor Kerry Smith addressed the issue of how to determine whether consumers’ health spending choices were the result of institutionally-imposed incentives, misleading messages, or rational behavior.