Current Issues in Health Economics: Volume 290

In March 2010, President Obama signed into law the most broad and sweeping reform of health care in U.S. history. This was done at a time when aggregate medical expenses are significantly higher than they have ever been:

Questions have arisen as to whether the school environment is currently a contributing factor to the increase in childhood obesity, and whether changes in school policies could help curb the increase. In this chapter, we discuss key aspects of the literature on the role of the school food environment, and the role of the school activity environment in effecting the caloric intake and expenditure of children. We also simulate the effect of a range of reasonable changes in weekly minutes spent being active in school, and changes in weekly calories consumed in school.

The purpose of this chapter is to empirically estimate the propensity for alcohol-related policies to influence rates of child abuse. Child maltreatment is measured by the number of abused children and the number of child fatalities due to abuse. The alcohol regulations of interest include beer, wine, and liquor taxes and prices, drunk driving laws, and measures of alcohol availability. Results indicate that higher excise taxes on alcohol and reductions in availability may be effective in reducing the incidence of child maltreatment.

Over the past three decades, the U.S. economy experienced a sharp increase in the labor-force participation of women, causing a similar increase in the demand for non-parental child care. Concurrent with these developments has been a dramatic rise in the prevalence of childhood obesity, prompting the question as to what extent the increase in child-care utilization is responsible for the growth in obesity. This chapter examines the impact of various child-care arrangements on school-age children's weight outcomes using panel data from the Early Childhood Longitudinal Study, Kindergarten Cohort (ECLS-K). An advantage of the ECLS-K for our purposes is that it tracks children's child-care arrangements between Kindergarten and the 5th grade. Our fixed-effects' results suggest that non-parental child-care arrangements are not strongly associated with children's weight outcomes. Our findings are robust to numerous sensitivity and subgroup analyses.

One of the fundamental tasks in optimal insurance design is mitigating the moral hazard effects inherent in insurance mechanisms. Empirically, relatively little is known about how individual-level time preferences affect selection of insurance options. We use several waves of the Health and Retirement Survey to explore the relationship between revealed time preferences at the individual level and the selection of insurance options for both the under-age-65 population and the Medicare-eligible population. Our results suggest that time preferences are not likely to be fixed across the life cycle, and that they appear to be important predictors of health insurance decisions.

This chapter examines whether or not the introduction of a new $20 family premium in Kentucky's Children's Health Insurance Program (CHIP) program in late 2003 had a differential impact on the enrollment duration of children in different demographic groups, with a special focus on any potential differences by race or ethnicity. A competing risk hazard model is estimated in order to differentiate between children exiting CHIP via a transfer to Medicaid and children who exited public coverage completely. We find that non-white children are generally more likely to exit than white children. This general white/non-white difference increases immediately following the introduction of the $20 premium

In this chapter, we discuss whether early-childhood investments in low-income children could lead to a lasting impact on health outcomes. We note that such investments could improve adolescent and adult health by increasing child health, increasing educational attainment, or influencing parents' behaviors. Model preschool programs, such as the High/Scope Perry Preschool Program and the Carolina Abecedarian Program, have been successful in increasing the educational attainment and health behaviors of low-income children. The Head Start program, which is the largest public investment in low-income, preschool-aged children in the United States, has also improved child health and educational attainment.

Although there is extensive research on the impact of Head Start participation, there has been little research on the impact on risky behaviors in adolescence. Using data from the Panel Study of Income Dynamics (PSID) and its Child Development Supplements (CDS), we examine the impact of Head Start participation on smoking, alcohol use, and drug use throughout adolescence and the extent to which varying degrees of selection on unobservables influence this relationship.

Universal helmet laws (UHLs) are widely believed to be effective in reducing motorcycle fatalities. In this chapter, we further investigate the effectiveness of such policies by focusing on their long-term impact as well as their effect on motorcycle use. Using state-level longitudinal data from 1975 to 2005, we estimate how the adoption and repeal of UHLs influence motorcycle safety. Our results confirm earlier findings that adoption of UHLs prevents fatalities, whereas repeals lead to higher fatality rates. We provide evidence that UHLs operate as intended, decreasing fatalities mainly by improving safety rather than by reducing motorcycle riding. Finally, using dynamic specifications, we show that the long-term effects of both adoption and repeal persist in the years beyond the policy change.

Obesity in children in many developing countries has increased substantially over the last several decades. This change has implications for population health and human capital due to the strong persistence in weight through adulthood and the large social costs of a growing number of unhealthy individuals. As suggested by many educational interventions, targeting health status during early childhood may be more efficient and equitable due to accumulation of effects. Thus, examining the primary sources of obesity and obesity disparities is important, including focuses on school, family, and community factors, among others. Recent evidence has suggested that racial differences in obesity status occur before school age and are difficult to explain. However, this chapter shows that with nationally representative data, the differences can be explained and point to poverty, family structure, and home language rather than race as focal factors for future interventions. Suggestive evidence is also provided that parental investments in physical activities are associated with early-childhood weight status.

Understanding health determinants and exactly how they affect health is an important social policy question. Empirical tests in the health literature typically find that the number of years of formal schooling completed is the most important correlate of good health. However, there is less consensus as to whether this correlation reflects a causal relationship between more schooling and better health. This chapter capitalizes on a unique social experiment: the 1950 Swedish comprehensive school reform, which was implemented in stages and by municipal areas, through which people born between 1945 and 1955 went through two different school systems (one of which required at least one more year of schooling). It uses an instrumental variables technique to estimate formal schooling's causal effect on adult health in Sweden. The instrumental variable for degree of education (schooling) generated from compulsory school reform yields a consistent estimate of education's causal impact on health, as measured by an bad health index and of body mass index in the healthy range. The additional schooling generated by Sweden's compulsory school reform produces improved adult health (controlling for cohort and county effects, family background characteristics, and individual income).

With expenditures totaling $227 billion in 2007, prescription drug purchases are a growing portion of the total medical expenditure, and as this industry continues to grow, prescription drugs will continue to be a critical part of the larger health care industry. This chapter presents a survey on the economics of the US pharmaceutical industry, with a focus on the role of R&D and marketing, the determinants (and complications) of prescription drug pricing, and various aspects of consumer behavior specific to this industry, such as prescription drug regulation, the patient's interaction with the physician, and insurance coverage. This chapter also provides background in areas not often considered in the economics literature, such as the role of pharmacy benefit managers in prescription drug prices and the differentiation between alternative measures of prescription drug prices.

Recent changes in smoking laws have influenced gambling behaviour at electronic gaming machine (EGM) venues. In this chapter, we review the literature that examines the interrelationship between gambling, problem gambling, and smoking in order to gauge the indirect effects of smoking bans in gaming venues. We then perform an analysis on the consequences of a smoking ban in Victoria, Australia, that was instituted on 1st September 2002. This analysis investigates the nature of the pattern of drops in local EGM revenue and the impact on the state tax revenue.