Columbia University | Economics

Job Market Paper

    How Do Hospitals Respond to Managed Care? Evidence from At-Risk Newborns

    Abstract: Medicaid, the largest public health insurance program in the US, has transitioned from a fee-for-service system (FFS) primarily administered by the government to a managed care system (MMC) administered by private insurers over the last few decades. I examine how hospitals' responses to financial incentives under these two systems affect hospital costs and newborn health outcomes. I analyze the universe of inpatient discharge records across New York State from 1995-2013, totaling 4.5 million births. First, I exploit an arbitrary determinant of MMC enrollment: infants weighing less than 1,200 grams were excluded from MMC and were instead served through FFS. Using a regression discontinuity design, I find that newborns enrolled in MMC stayed fewer days in hospitals and thus had less expensive visits relative to newborns enrolled in FFS. The cost difference is driven by birth hospitals retaining more newborns enrolled in FFS while transferring away those enrolled in MMC. I find that MMC had limited impacts on newborn health, measured by in-hospital mortality and hospital readmission. Hospitals tended to transfer out MMC newborns only when a high-quality hospital was nearby, which resulted in these infants receiving uncompromised care. Second, I exploit county-level rollout of the MMC mandate to examine impacts on the full population of infants using a difference-in-difference design. I find that hospitals achieved a similar rate of cost savings as for infants over the 1,200-gram threshold, while length of stay, the probability of transfer, and mortality did not change following the mandate. This finding suggests that there are alternative, successful methods by which hospitals reduce costs under MMC, including for high-risk deliveries.

Working Papers

Published Research

    Impacts of Classifying New York City Students as Overweight

    (with Douglas Almond and Amy Ellen Schwartz), Proceedings of the National Academy of Sciences (Mar 2016)

    Press: Study questions impact of NYC students' weight report cards (The Associated Press, Mar 2016)
               Do schools' BMI screenings of students even work? (CNN, Mar 2016)
               A new study suggests that "fitness report cards" telling students they're fat could backfire (Slate, Mar 2016)

    Abstract: US schools increasingly report body mass index (BMI) to students and their parents in annual fitness “report cards.” We obtained 3,592,026 BMI reports for New York City public school students for 2007–2012. We focus on female students whose BMI puts them close to their age-specific cutoff for categorization as overweight. Overweight students are notified that their BMI “falls outside a healthy weight” and they should review their BMI with a health care provider. Using a regression discontinuity design, we compare those classified as overweight but near to the overweight cutoff to those whose BMI narrowly earned them a “healthy” BMI grouping. We find that overweight categorization generates small impacts on girls’ subsequent BMI and weight. Whereas presumably an intent of BMI report cards was to slow BMI growth among heavier students, BMIs and weights did not decline relative to healthy peers when assessed the following academic year. Our results speak to the discrete categorization as overweight for girls with BMIs near the overweight cutoff, not to the overall effect of BMI reporting in New York City.

    Late-Career Job Loss and Retirement Behavior of Couples

    forthcoming, Social Insurance and Lifecycle Events among Older Americans Special Issue, Research on Aging, edited by Kenneth A. Couch, Mary C. Daly, and Julie M. Zissimopoulos
    Vickrey Prize for Best 3rd Year Paper (Runner Up), Columbia University

    Abstract: This paper argues that wealth uncertainty influences when couples choose to retire. Using data from the Health and Retirement Study, I show that wives delay retirement when their husbands retire following a job loss. This effect is stronger when husbands are the primary earners, and couples are relatively poorer. This provides evidence of intra-household insurance that mitigates the impact of an unexpected earnings shock. I find that wives tend to delay retirement only until they become eligible for Social Security. This suggests that Social Security benefits can relax households’ budget constraints and allow wives to join their husbands in retirement.

Work in Progress

    Severity-Adjusted Payments and Hospital Practice
    Liquidity Constraints and Health Care Utilization: Evidence from the Earned Income Tax Credit

Ajin Lee

Department of Economics
Columbia University
420 West 118th Street
New York, NY 10027

Phone: (646) 842-1986