Physician Behavior in the Presence of a Secondary Market: The Case of Prescription Opioids

Abstract: This paper examines how patient and physician behavior across legal and illegal markets have contributed to the US opioid epidemic. To do so, I design and estimate a model of physician behavior in the presence of an endogenous secondary market with patient search. To access prescription opioids for medical purposes or misuse, patients search over physicians on the legal, primary market or turn to an illegal, secondary market. Physicians, who care about their revenue and their impact on population health, take into account the existence of this secondary market when prescribing. Estimates demonstrate that the presence of a secondary market induces physicians to be more careful in their prescribing—thereby bringing prescriptions closer to their optimal level—but results in significant harm on net due to the reallocation of prescriptions for abuse.

Just What the Nurse Practitioner Ordered: Independent Prescriptive Authority and Population Mental Health 
(FRB of Chicago Working Paper No. WP-2017-8) with Diane Alexander
Accepted, Journal of Health Economics

Abstract: We examine whether relaxing occupational licensing to allow nurse practitioners (NPs)—registered nurses with advanced degrees—to prescribe medication without physician oversight is associated with improved population mental health. Exploiting time-series variation in independent prescriptive authority for NPs from 1990–2014, we find that broadening prescriptive authority is associated with improvements in self-reported mental health and decreases in mental-health-related mortality. These improvements are concentrated in areas underserved by psychiatrists and among populations traditionally underserved by mental health providers. Our results demonstrate that extending prescriptive authority to NPs can help mitigate physician shortages and extend care to disadvantaged populations.

Check Up Before You Check Out: Retail Clinics and Emergency Room Use 
(NBER Working Paper No. 23585) with Diane Alexander and Janet Currie
Revision requested, Journal of Public Economics

Abstract: We use the universe of emergency room (ER) visits in New Jersey from 2006-2014 to examine the impact of retail clinics on ER usage in a difference-in-difference framework. We find significant effects of retail clinics on ER visits for both minor and preventable conditions, with residents who live close to an open clinic being 4.1-12.3 percent less likely to use an ER for these conditions. Our estimates suggest annual cost savings from reduced ER usage of over 70 million if retail clinics were to be readily available across all of New Jersey.

Physician Payments and Access to Care: Evidence from Medicaid
(FRB of Chicago Working Paper No. WP-2017-10) with Diane Alexander

Abstract: We examine how the amount a physician is paid influences who they are willing to see. To do so, we exploit large, exogenous changes in Medicaid reimbursement rates—driven primarily by a federal mandate requiring that states raise Medicaid payments to match Medicare rates for primary care visits—to quantify the impact of physician payments on access to care. We find that increasing Medicaid payments to primary care doctors leads to improvements in access, increased office visits, and better self-reported health among beneficiaries. We find no evidence of negative spillovers to the privately insured. Our results underscore the importance of financial incentives in driving physician behavior.

U.S. Employment and Opioids: Is There a Connection?
(NBER Working Paper No. 24440) with Janet Currie and Jonas Jin

Abstract: This paper uses quarterly county-level data to examine the relationship between opioid prescription rates and employment-to-population ratios from 2006–2014. We first estimate models of the effect of opioid prescription rates on employment-to-population ratios, instrumenting opioid prescriptions for younger ages using opioid prescriptions to the elderly. We then estimate models of the effect of employment-to-population ratios on opioid prescription rates using a shift-share instrument. We find that the estimated effect of opioids on employment-to-population ratios is positive but small for women, but there is no relationship for men. These findings suggest that although they are addictive and dangerous, opioids may allow some women to work who would otherwise leave the labor force. When we examine the effect of employment-to-population ratios on opioid prescriptions, our results are more ambiguous. Overall, our findings suggest that there is no simple causal relationship between economic conditions and the abuse of opioids. Therefore, while improving economic conditions in depressed areas is desirable for many reasons, it is unlikely to curb the opioid epidemic.


Food Deserts and the Causes of Nutritional Inequality
with Hunt Allcott, Rebecca Diamond, Jean-Pierre Dubé, Jessie Handbury, and Ilya Rahkovsky
Quarterly Journal of Economics, forthcoming

Abstract: We study the causes of “nutritional inequality”: why the wealthy eat more healthfully than the poor in the United States. Exploiting supermarket entry and household moves to healthier neighborhoods, we reject that neighborhood environments contribute meaningfully to nutritional inequality. We then estimate a structural model of grocery demand, using a new instrument exploiting the combination of grocery retail chains’ differing presence across geographic markets with their differing comparative advantages across product groups. Counterfactual simulations show that exposing low-income households to the same products and prices available to high-income households reduces nutritional inequality by only about 10 percent, while the remaining 90 percent is driven by differences in demand. These findings counter the argument that policies to increase the supply of healthy groceries could play an important role in reducing nutritional inequality.

Addressing the Opioid Epidemic: Is There a Role for Physician Education? (online appendix)
with Janet Currie
American Journal of Health Economics, 2018, 4(3): 383-410 

Abstract: Using data on all opioid prescriptions written by physicians from 2006-2014, we uncover a striking relationship between opioid prescribing and medical school rank. Even within the same specialty and county of practice, physicians who completed their initial training at top medical schools write significantly fewer opioid prescriptions than physicians from lower ranked schools. Additional evidence suggests that some of this gradient represents a causal effect of education rather than patient selection across physicians or physician selection across medical schools. Altering physician education may therefore be a useful policy tool in fighting the current epidemic.


The Opioid Crisis: Tragedy, Treatments, and Trade-offs
SIEPR Policy Brief, February 2019

Research Roundup: What Does the Evidence Say About How to Fight the Opioid Epidemic?
with Jennifer Doleac and Anita Mukherjee
Brookings Institute, December 2018

A Closer Look at How the Opioid Epidemic Affects Employment
with Janet Currie
Harvard Business Review, August 2018

Evaluating the Economic Response to Japan's Earthquake
with David Weinstein
RIETI Policy Discussion Paper Series, February 2012