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Does managed care widen infant health disparities? Evidence from Texas medicaid

Author(s): Kuziemko, Ilyana; Meckel, K; Rossin-Slater, M

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Abstract: © 2018 American Economic Association. 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.
Publication Date: Aug-2018
Citation: Kuziemko, I, Meckel, K, Rossin-Slater, M. (2018). Does managed care widen infant health disparities? Evidence from Texas medicaid. American Economic Journal: Economic Policy, 10 (3), 255 - 283. doi:10.1257/pol.20150262
DOI: doi:10.1257/pol.20150262
ISSN: 1945-7731
EISSN: 1945-774X
Pages: 255 - 283
Type of Material: Journal Article
Journal/Proceeding Title: American Economic Journal: Economic Policy
Version: Final published version. Article is made available in OAR by the publisher's permission or policy.

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