Designing Competition in Health Care Markets

In this paper we propose a simple, market based mechanism to set prices in health care markets, namely a system where the patients are auctioned out to the hospitals. Our aim is to characterize principles as to how such an auction should be designed. In the case of elective treatment, health authorities thus organize a competition between hospitals. The hospital with the lowest price signs a contracts with authority (or the insurer) that commits him to treat a given number of patients within a predetermined period. However, this is not a simple mechanism that identi…es the hospital with the lowest treatment cost. Due to potentially rapid and unpredictable shifts in demand, treatment capacity may be hard to know in advance. There is always a risk that treatment must be canceled due to arrival of patients that require acute treatment. This calls for a market design that accounts for the risk of default. Our main result is that the expected cost for the government is reduced if the government chooses to ”subsidize” default. This could be thought of as a system in which the government buys treatment in the spot market in the case of default, and let the hospital pay a default fee that is lower than the spot price. The reason why this reduces expected costs for the government is that the e¤ect on the bids is asymmetric: The second lowest bid is on average reduced more than the winning bid. Hence, the winner’s profit tends to shrink. This is due to what we characterize an endogenous correlation. Since the cost of treatment increases in the default risk (as the hospital must pay a penalty if it defaults), high cost hospitals typically have larger default risks than low costs hospitals.Health care markets; health care; hospitals; competition

Politicians and soft budget constraints

We study soft budget constraints from the perspective of political economics. A partly partisan government confronts a budget crisis in a politically important sector, e.g. like the health care sector. To what extent the government wants to make additional grants to the sector depends on economic conditions and on the preferences of the government, both unknown to the electorate. Thus, the government’s budget response gives a signal of its preferences, and may thereby influence the probability that the government is re-elected. As a result, the handeling of a budget crisis becomes inefficient even from an ex post point of view, in the sense that it does not react adequately to changing economic conditions.Political economics; budget constraints; budget crisis

Automatic Emphysema Detection using Weakly Labeled HRCT Lung Images

A method for automatically quantifying emphysema regions using High-Resolution Computed Tomography (HRCT) scans of patients with chronic obstructive pulmonary disease (COPD) that does not require manually annotated scans for training is presented. HRCT scans of controls and of COPD patients with diverse disease severity are acquired at two different centers. Textural features from co-occurrence matrices and Gaussian filter banks are used to characterize the lung parenchyma in the scans. Two robust versions of multiple instance learning (MIL) classifiers, miSVM and MILES, are investigated. The classifiers are trained with the weak labels extracted from the forced expiratory volume in one minute (FEV$_1$) and diffusing capacity of the lungs for carbon monoxide (DLCO). At test time, the classifiers output a patient label indicating overall COPD diagnosis and local labels indicating the presence of emphysema. The classifier performance is compared with manual annotations by two radiologists, a classical density based method, and pulmonary function tests (PFTs). The miSVM classifier performed better than MILES on both patient and emphysema classification. The classifier has a stronger correlation with PFT than the density based method, the percentage of emphysema in the intersection of annotations from both radiologists, and the percentage of emphysema annotated by one of the radiologists. The correlation between the classifier and the PFT is only outperformed by the second radiologist. The method is therefore promising for facilitating assessment of emphysema and reducing inter-observer variability.Comment: Accepted at PLoS ON

Anomalous Non-Hydrogenic Exciton Series in 2D Materials on High-κ\kappa Dielectric Substrates

Engineering of the dielectric environment represents a powerful strategy to control the electronic and optical properties of two-dimensional (2D) materials without compromising their structural integrity. Here we show that the recent development of high-$\kappa$ 2D materials present new opportunities for dielectric engineering. By solving a 2D Mott-Wannier exciton model for WSe$_2$ on different substrates using a screened electron-hole interaction obtained from first principles, we demonstrate that the exciton Rydberg series changes qualitatively when the dielectric screening within the 2D semiconductor becomes dominated by the substrate. In this regime, the distance dependence of the screening is reversed and the effective screening increases with exciton radius, which is opposite to the conventional 2D screening regime. Consequently, higher excitonic states become underbound rather than overbound as compared to the Hydrogenic Rydberg series. Finally, we derive a general analytical expression for the exciton binding energy of the entire 2D Rydberg serie

Atopic dermatitis and risk of atrial fibrillation or flutter: A 35-year follow-up study.

BACKGROUND: Atopic dermatitis is characterized by chronic inflammation, which is a risk factor for atrial fibrillation. OBJECTIVE: To examine the association between hospital-diagnosed atopic dermatitis and atrial fibrillation. METHODS: Using linked population-based Danish registries, we identified persons with an inpatient or outpatient hospital diagnosis of atopic dermatitis during 1977-2013 and a comparison cohort individually matched to the atopic dermatitis cohort. We followed cohorts until death, emigration, atrial fibrillation diagnosis, or end of study (January 1, 2013). We compared 35-year risk of atrial fibrillation and estimated hazard ratios with 95% confidence intervals using Cox regression, adjusting for birth year and sex. We validated 100 atopic dermatitis diagnoses from a dermatologic department through medical record review. RESULTS: We included 13,126 persons with atopic dermatitis and 124,211 comparators and followed them for a median of 19.3 years. The 35-year risk of atrial fibrillation was 0.81% and 0.67%, respectively. The positive predictive value of atopic dermatitis diagnoses was 99%. The hazard ratio was 1.2 (95% confidence interval 1.0-1.6) and remained increased after adjusting for various atrial fibrillation risk factors. LIMITATIONS: Analyses were limited to persons with moderate-to-severe atopic dermatitis, and we had no lifestyle data. CONCLUSION: Patients with hospital-diagnosed atopic dermatitis have a 20% increased long-term risk of atrial fibrillation, but the absolute risk remains low