Working Papers

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.

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

Abstract: We study the causes of “nutritional inequality”: why the wealthy eat more healthfully than the poor in the United States. Exploiting supermarket entry, household moves to healthier neighborhoods, and purchasing patterns among households with identical local supply, we reject that neighborhood environments contribute meaningfully to nutritional inequality. Using a structural demand model, we find that exposing low-income households to the same products and prices available to high-income households reduces nutritional inequality by only nine percent, while the remaining 91 percent is driven by differences in demand. These findings counter the common notion that policies to reduce supply inequities, such as “food deserts,” could play an important role in reducing nutritional inequality. By contrast, the structural results predict that means-tested subsidies for healthy food could eliminate nutritional inequality at a fiscal cost of about 15 percent of the annual budget for the U.S. Supplemental Nutrition Assistance Program.


Closing the Gap: The Impact of the Medicaid Primary Care Rate Increase on Access and Health 
(FRB of Chicago Working Paper No. WP-2017-10) with Diane Alexander

Abstract: The difficulties that Medicaid beneficiaries face accessing medical care are often attributed to the program's low reimbursement rates relative to other payers. There is little evidence, however, as to the actual effects of doctor payment rates from Medicaid on access and health outcomes for beneficiaries. In this paper, we exploit within-state variation in Medicaid reimbursement rates driven by the Medicaid fee bump—a provision of the Affordable Care Act mandating that states raise Medicaid payments to match Medicare rates for primary care visits for 2013 and 2014—to quantify the impact of changes in physician payment on access to treatment. As Medicaid rates are set at the state level and vary considerably in generosity, the policy had a large and heterogeneous impact across states. We find that increasing Medicaid payments to primary care doctors is associated with significant increases in office visits, improvements in access measures, and better self-reported health among Medicaid beneficiaries. Among children on Medicaid, fee increases are also associated with fewer days of missed school.


Check Up Before You Check Out: Retail Clinics and Emergency Room Use 
Revision requested at Journal of Public Economics

(NBER Working Paper No. 23585) with Diane Alexander and Janet Currie

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.

Just What the Nurse Practitioner Ordered: Independent Prescriptive Authority and Population Mental Health 
Revision requested at Journal of Health Economics

(FRB of Chicago Working Paper No. WP-2017-8) with Diane Alexander

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, including suicides. 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.
 

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.


Publications

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.


Practitioner Articles

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