Less Social Health Insurance – More Private Supplementary Insurance? – Empirical Evidence from Germany

This paper uses individual level data to analyze the effect of changes in the compulsory benefit package of the German statutory health insurance scheme on the demand for private supplementary insurance. In particular, we aim at measuring the effect of excluding dentures from the benefit package in 1997 as well as the effect of re-including them in 1999.Adifference-in-differences estimator is used. Individuals born prior to 1979 serve as control group because only the young were affected by the reform.Our results do not exhibit any significant effects on the demand for supplementary health insurance. Thus, the hypothesis that clients do make informed choices about their health insurances’ coverage is not supported.Supplementary private health insurance, dentures, difference- indifferences

The Eff ect of Self-assessed Job Security on the Demand for Medical Rehab

The interdependence of labor market conditions and the demand for health care has been addressed by several theoretical and empirical analyses. We contribute to the debate by empirically examining the eff ect of a decrease in self-perceived job security on health care utilization. That is, employees at risk of losing their job might postpone or even try not to use non-acute rehab measures in order to reduce their individual risk of being laid off by avoiding absenteeism and signaling good health. We use individual-level data from the German Socioeconomic Panel for the years 2003, 2004, and 2006. The identifi cation strategy rests on an instrumental variable approach where the county unemployment rate and its relative change compared to the previous year serve as instruments for the employees’ self-assessed risk of losing their jobs. Contrary to the hypothesis, we have evidence for job insecurity increasing the demand for medical rehab. This finding is robust to various model variants.Rehab; unemployment; health care utilization; job worries; absenteeism; sick leave

Does the Quality of Hospital Treatment Vary by Days of the Week?

This paper investigates the relationship between health outcomes and variations in staffing levels as approximated by admissions on weekdays versus admissions on weekends. Because days of admission are potentially endogenous, we instrument on emergency admissions only, which are reasonably exogenous to the time of admission. Further,we introduce a direct measure for within- diagnosis variation in severity across days of admission to control for the unobservable selection of patients.We find that after controlling for patient heterogeneity and endogeneity of the day of admission there is still a significant variation in mortality rates between weekend and weekday admissions. Patients admitted during the weekend exhibit higher in-hospital mortality rates. We also find signs of premature discharge, as patients with short lengths of stay tend to exhibit higher probability to be readmitted as emergency cases.Hospital quality, weekend effect, inpatient outcomes

Copayments in the German Health System – Do They Work?

This paper examines the effect of copayments on doctor visits using the German health care reform of 2004 as a natural experiment. In January 2004, copayments of 10 euros for the first doctor visit in each quarter have been introduced for all adults in the statutory health insurance. Individuals covered by private health insurance as well as youths have been exempted from these copayments. We use them as control groups in a difference-in-differences approach to identify the causal impact of these copayments on doctor visits. In contrast to expectations and public opinion our results indicate that there are no statistically significant effects of the copayments on the decision of visiting a doctor.Copayment, doctor visits, difference-in-differences, fixed-effect logit

Does Higher Cost Inefficiency Imply Higher Profit Inefficiency? - Evidence on Inefficiency and Ownership of German Hospitals

This paper investigates cost and profit efficiency of German hospitals. More specifically, it deals with the question how hospital efficiency varies with ownership, patient structure and other exogenous factors, which are neither inputs nor outputs of the production process. We conduct a Stochastic Frontier Analysis (SFA) on a multifaceted administrative German dataset combined with the balance sheets of 374 hospitals for the years 2002 to 2005.The results indicate that private (for-profit) and (private) non-profit hospitals are on average less cost efficient but more profit efficient than publicly owned hospitals.Hospital efficiency, ownership, stochastic frontier analysis, profit function

Explaining Differences in Remuneration Rates of Nursing Homes in Germany

Remuneration rates of German nursing homes are prospectively negotiated between long-term care insurance (LTCI) and social assistance on the one side and nursing homes on the other. They diff er considerably across regions while there is no evidence for substantial differences in care provision. This paper explains the differences in the remuneration rates by observable characteristics of the nursing home, its residents and its region with a special focus on the largest federal state North-Rhine-Westphalia, in which the most expensive nursing homes are located. We use data from the German Federal Statistical Office for 2005 on all nursing homes that off er full-time residential care for the elderly. We find that differences in remuneration rates can partly be explained by exogenous factors. Controls for residents, nursing homes, and district characteristics explain roughly 30% of the price difference; 40% can be ascribed to a regionally different kind of negotiation between nursing homes and LTCI. 30% of the raw price difference remains unexplained by observable characteristics.Nursing homes; determinants of remuneration rates; regional price differences

Demand, Selection and Patient Outcomes in German Acute Care Hospitals

In times of peak demand hospitals may fail to deliver the high standard of treatment quality that they are able to offer their patients at regular times. To assess the magnitude of these effects, this study analyzes the effects of low staff-to-patients ratios on patient outcomes empirically.We use the variation of patient admissions over time as a proxy for varying staff level. Further, we control for within diagnosis unobservable variation in severity across days with as opposed to days without excess demand.We find that when this variation is ignored in the regression framework, the effect of demand on outcomes is biased upwards. The reason is that when demand is high more patients with a higher unobservable frailty are admitted to the hospitals. After having controlled for this selection of patients, excess demand does not negatively affect patient outcomes.Hospital staffing, inpatient outcomes

The Effects of Reference Pricing on Ex-factory Prices of Rx Drugs in Germany – A Panel Data Approach

This paper examines effects of reference pricing for prescription drugs in German social health insurance based on econometric panel data methods. We analyze the effect on ex-factory prices. Moreover, we investigate whether manufacturers adapt prices of their products not subject to reference pricing as a consequence of changes in reference prices of their products subject to reference pricing.We use a large panel data set of nearly all German prescription drugs on a monthly basis between October 1994 and July 2005. Altogether, the data comprise almost 4 million observations. They provide information on ex-factory prices, reference prices, manufacturers, type of prescription drug, and market entries and exits. Our results show that there is no full price adjustment:A 1%-change in reference prices leads to a 0.3%-change in market prices. Price adjustment, however, is fast, it mostly happens in the first month. Furthermore, the first introduction of a reference price reduces market prices of the affected products by approximately 14%. Finally, we observe a significant time effect which is positive in the market without reference prices and negative in that with reference price.Price elasticity, temporal development, fixed effects model

Evaluation Strategies in Labor Economics -- An Application to Post-Secondary Education

Die Evaluierung der Investitionen in Ausbildung und ihrer Wirkungen auf den Arbeitsmarkt ist in modernen Gesellschaften von zentralem Interesse. Gewöhnlich ist die Meinung gegenüber der ökonomischen und gesellschaftlichen Rendite der Ausbildung positiv: ein Mehr an Ausbildung zieht eine höhere gesellschaftliche und individuelle Wohlfahrt nach sich. Eine empirische Untersuchung dieses Zusammenhangs gestaltet sich jedoch äußerst schwierig. Der Grund ist darin zu suchen, daß ein gemessener positiver Zusammenhang nicht notwendigerweise auch auf einen positiven kausalen Zusammenhang schließen läßt. Es wird oft argumentiert, daß gewisse inhärente Fähigkeiten zur Einkommenserzielung die eigentliche Ursache für sowohl Ausbildung als auch Einkommen sein könnten. Das bedeutet, daß die Schätzung der ökonomischen Rendite der Ausbildung die Konstruktion einer adäquaten Vergleichsgruppe für die ausgebildeten Individuen voraussetzt. Eine solche Vergleichsgruppe sollte mit der zu untersuchenden im Hinblick auf alle Eigenschaften identisch sein mit der Ausnahme, eine gewisse Menge an Ausbildung nicht erhalten zu haben. Diese Dissertation stellt mehrere ökonometrische Evaluierungsstrategien einander gegenüber. Unter anderem erweitert sie den Anwendungsbereich des sogenannten 'matching' auf Ausbildungsfragen und schätzt den Effekt einer College Ausbildung auf Stundenlöhne. Sie stützt sich dabei auf Daten des National Longitudinal Survey of Youth 1979, eines amerikanischen Panel Datensatzes. Sie kommt zu dem Ergebnis, daß Ausbildung in der Tat eine lohnenswerte Investition darstellt, obgleich gewisse Fähigkeitsmaße eine große Erklärungskraft aufzuweisen scheinen. Schließlich untersucht sie zahlreiche methodologische und praktische Aspekte, die bei Anwendung dieses neuen nicht-parametrischen Schätzverfahrens auftreten, das noch weit davon entfernt ist völlig verstanden zu werden

Ownership and Financial Performance in the German Hospital Sector

This paper considers the role of ownership form for the financial performance of German acute care hospitals and its development over time.We measure financial performance by a hospital-specific yearly probability of default (PD). Using a panel of hospital data, our models allow for state dependence in the PD as well as unobserved individual heterogeneity. We find that private ownership is more likely to be associated with sound levels in financial performance than public ownership. Moreover, state dependence in the PD is substantial, albeit not ownership-specific.Finally, our evidence suggests that overall efficiency may be enhanced most by closing down some loss-making public hospitals rather than by their restructuring, especially because the German hospital market has substantial excess capacities.Hospitals ownership, financial performance, state dependence