American Economic Journal:
Economic Policy
ISSN 1945-7731 (Print) | ISSN 1945-774X (Online)
Does Managed Care Widen Infant Health Disparities? Evidence from Texas Medicaid
American Economic Journal: Economic Policy
vol. 10,
no. 3, August 2018
(pp. 255–83)
Abstract
Medicaid programs increasingly finance competing, capitated managed care plans rather than administering fee-for-service (FFS) programs. We study how the transition from FFS to managed care affects high- and low-cost infants (blacks and Hispanics, respectively). We find that black-Hispanic disparities widen—e.g., black mortality and preterm birth rates increase by 15 percent and 7 percent, respectively, while Hispanic mortality and preterm birth rates decrease by 22 percent and 7 percent, respectively. Our results are consistent with a risk-selection model whereby capitation incentivizes competing plans to offer better (worse) care to low- (high-) cost clients to retain (avoid) them in the future.Citation
Kuziemko, Ilyana, Katherine Meckel, and Maya Rossin-Slater. 2018. "Does Managed Care Widen Infant Health Disparities? Evidence from Texas Medicaid." American Economic Journal: Economic Policy, 10 (3): 255–83. DOI: 10.1257/pol.20150262Additional Materials
JEL Classification
- H75 State and Local Government: Health; Education; Welfare; Public Pensions
- I12 Health Behavior
- I18 Health: Government Policy; Regulation; Public Health
- I38 Welfare, Well-Being, and Poverty: Government Programs; Provision and Effects of Welfare Programs
- J13 Fertility; Family Planning; Child Care; Children; Youth
- J15 Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
An assessment of the evidence
Reply to Kaestner, Joyce, and Racine