Fund Management and Systemic Risk - Lessons from the Global Financial Crisis

Fund managers play an important role in increasing efficiency and stability in financial markets. But research also indicates that fund management in certain circumstances may contribute to the buildup of systemic risk and severity of financial crises. The global financial crisis provided a number of new experiences on the contribution of fund managers to systemic risk. In this article, we focus on these lessons from the crisis. We distinguish between three sources of systemic risk in the financial system that may arise from fund management: insufficient credit risk transfer to fund managers; runs on funds that cause sudden reductions in funding to banks and other financial entities; and contagion through business ties between fund managers and their sponsors. Our discussion relates to the current intense debate on the role the so-called shadow banking system played in the global financial crisis. Several regulatory initiatives have been launched or suggested to reduce the systemic risk arising from non-bank financial entities, and we briefly discuss the likely impact of these on the sources of systemic risk outlined in the article

The Sustainable Development Oxymoron: Quantifying and Modelling the Incompatibility of Sustainable Development Goals

In 2015, the UN adopted a new set of Sustainable Development Goals (SDGs) to eradicate poverty, establish socioeconomic inclusion and protect the environment. Critical voices such as the International Council for Science, however, have expressed concerns about the potential incompatibility of the SDGs, specifically the incompatibility of socio-economic development and environmental sustainability. In this paper we test, quantify and model the alleged inconsistency of SDGs. Our analyses show which SDGs are consistent and which are conflicting. We measure the extent of inconsistency and conclude that the SDG agenda will fail as a whole if we continue with business as usual. We further explore the nature of the inconsistencies using dynamical systems models, which reveal that the focus on economic growth and consumption as a means for development underlies the inconsistency. Our models also show that there are factors which can contribute to development (health programs, government investment in education) on the one hand and ecological sustainability (renewable energy) on the other, without triggering the conflict between incompatible SDGs

Catastrophic payments for health care in Asia

Out-of-pocket (OOP) payments are the principal means of financing health care throughout much of Asia. We estimate the magnitude and distribution of OOP payments for health care in fourteen countries and territories accounting for 81% of the Asian population. We focus on payments that are catastrophic, in the sense of severely disrupting household living standards, and approximate such payments by those absorbing a large fraction of household resources. Bangladesh, China, India, Nepal and Vietnam rely most heavily on OOP financing and have the highest incidence of catastrophic payments. Sri Lanka, Thailand and Malaysia stand out as low to middle income countries that have constrained both the OOP share of health financing and the catastrophic impact of direct payments. In most low/middle-income countries, the better-off are more likely to spend a large fraction of total household resources on health care. This may reflect the inability of the poorest of the poor to divert resources from other basic needs and possibly the protection of the poor from user charges offered in some countries. But in China, Kyrgyz and Vietnam, where there are no exemptions of the poor from charges, they are as, or even more, likely to incur catastrophic payments

Effect of having private health insurance on the use of health care services: the case of Spain

Background: Several stakeholders have undertaken initiatives to propose solutions towards a more sustainable health system and Spain, as an example of a European country affected by austerity measures, is looking for ways to cut healthcare budgets. Methods: The aim of this paper is to study the effect of private health insurance on health care utilization using the latest micro-data from the European Community Household Panel (ECHP), the Spanish National Health Survey (SNHS) and the European Union Statistics on Income and Living Conditions (EU-SILC). We use matching techniques based on propensity score methods: single match, four matches, bias-adjustment and allowing for heteroskedasticity. Results: The results demonstrate that people with a private health insurance, use the public health system less than individuals without double health insurance coverage. Conclusions: Our conclusions are useful when policy makers design public-private partnership policie

Pharmaceutical Cost-Sharing Systems and Savings for Health Care Systems from Parallel Trade

This paper analyzes the consequences of parallel trade on health care systems in a two-country model with a vertical distributor relationship. In particular, two cost-sharing systems - coinsurance and indemnity insurance - are compared with respect to changes in copayments and public health expenditure. Under both cost-sharing systems, parallel trade generates a price-decreasing competition effect in the destination country and a price-increasing double marginalization effect in the source country. In the destination country, copayments for patients decrease to a larger extent under indemnity insurance, whereas reductions of public health expenditure occur only under coinsurance. In the source country, copayments increase less under coinsurance, whereas health expenditure is reduced more under indemnity insurance. This illustrates that a harmonization of health care systems would not make sense

Analyzing Regional Variation in Health Care Utilization Using (Rich) Household Microdata

This paper exploits rich SOEP microdata to analyze state-level variation in health care utilization in Germany. Unlike most studies in the field of the Small Area Variation (SAV) literature, our approach allows us to net out a large array of individual-level and state-level factors that may contribute to the geographic variation in health care utilization. The raw data suggest that state-level hospitalization rates vary from 65 percent to 165 percent of the national mean. Ambulatory doctor visits range from 90 percent to 120 percent of the national mean. Interestingly, in the former GDR states doctor visit rates are significantly below the national mean, while hospitalization rates lie above the national mean. The significant state-level differences vanish once we control for individual-level socio-economic characteristics, the respondents' health status, their health behavior as well as supply-side state-level factors

Psychiatric inpatient expenditures and public health insurance programmes: analysis of a national database covering the entire South Korean population

<p>Abstract</p> <p>Background</p> <p>Medical spending on psychiatric hospitalization has been reported to impose a tremendous socio-economic burden on many developed countries with public health insurance programmes. However, there has been no in-depth study of the factors affecting psychiatric inpatient medical expenditures and differentiated these factors across different types of public health insurance programmes. In view of this, this study attempted to explore factors affecting medical expenditures for psychiatric inpatients between two public health insurance programmes covering the entire South Korean population: National Health Insurance (NHI) and National Medical Care Aid (AID).</p> <p>Methods</p> <p>This retrospective, cross-sectional study used a nationwide, population-based reimbursement claims dataset consisting of 1,131,346 claims of all 160,465 citizens institutionalized due to psychiatric diagnosis between January 2005 and June 2006 in South Korea. To adjust for possible correlation of patients characteristics within the same medical institution and a non-linearity structure, a Box-Cox transformed, multilevel regression analysis was performed.</p> <p>Results</p> <p>Compared with inpatients 19 years old or younger, the medical expenditures of inpatients between 50 and 64 years old were 10% higher among NHI beneficiaries but 40% higher among AID beneficiaries. Males showed higher medical expenditures than did females. Expenditures on inpatients with schizophrenia as compared to expenditures on those with neurotic disorders were 120% higher among NHI beneficiaries but 83% higher among AID beneficiaries. Expenditures on inpatients of psychiatric hospitals were greater on average than expenditures on inpatients of general hospitals. Among AID beneficiaries, institutions owned by private groups treated inpatients with 32% higher costs than did government institutions. Among NHI beneficiaries, inpatients medical expenditures were positively associated with the proportion of patients diagnosed into dementia or schizophrenia categories. However, for AID beneficiaries, inpatient medical expenditures were positively associated with the proportion of all patients with a psychiatric diagnosis that were AID beneficiaries in a medical institution.</p> <p>Conclusions</p> <p>This study provides evidence that patient and institutional factors are associated with psychiatric inpatient medical expenditures, and that they may have different effects for beneficiaries of different public health insurance programmes. Policy efforts to reduce psychiatric inpatient medical expenditures should be made differently across the different types of public health insurance programmes.</p

Comparing policies to tackle ethnic inequalities in health: Belgium 1 Scotland 4

Ethnic-minority health is a public health priority in Europe. This study compares strategies for tackling ethnic inequalities in health from two countries, Scotland and Belgium. Methods: We compared the countries using the Whitehead framework. Official policy documents were retrieved and reviewed and two databases related to immigrant health policies were also used. Ethnic inequalities in health were compared using the UK and Belgian Censuses of 2001. We analysed the recognition of the problem, the policies and the services and described ethnic health inequalities. Results: Scotland has recognized the problem of ethnic inequalities in health, thanks to better data and the Scottish Government has come up with a bold strategy. Belgium is a later starter, unable to properly monitor ethnic inequalities. In addition, there is no clear government commitment to tackling either health inequalities or ethnic inequalities in health. Both countries provide health-care services to ethnic minority groups through the mainstream services, although ethnic minority groups have more choice in Belgium than in Scotland. Overall, ethnic heath inequalities are lower in Scotland than in Belgium. Conclusion: Scotland has provided a more advanced and comprehensive response to tackling ethnic inequalities in health than Belgium. It has acknowledged that discrimination exists and that ethnic minority groups may have different needs. Belgium still assumes non-discrimination in health care and effectively denies the need for policy to tailor services to meet these needs. In Scotland, public organizations have been made accountable for promoting equality in health. This is an important contribution to European health policy