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Biomedical subjects

H E Frech

Publications and source records attributed to H E Frech.

15 recordsLinked to original sources

Is the United States an outlier in health care and health outcomes? A preliminary analysis.

U.S. health care is often seen as an outlier, with high costs and only middling outcomes. This view implies a household production function for health, with both health care and lifestyle serving as inputs. Building on earlier work by Miller and Frech (2004), we make this argument explicit by estimating a production function from augmented OECD data. This allows us to determine whether the U.S. is literally an outlier; which turns on whether the United States is very far off the production surface. We find that the Unites States is somewhat less productive than the average OECD country, but that a substantial part of the observed difference results from poor lifestyle choices, particularly obesity.

Adult↗

The effects of pharmaceutical consumption and obesity on the quality of life in the organization of economic cooperation and development (OECD) countries.

OBJECTIVE: The objective of this study is to validate our earlier work on life expectancy with more recent data and, more importantly, to extend it to examine quality of life, not only the length of life. DESIGN AND SETTING: The analysis focuses on the production of health, disaggregating healthcare into pharmaceutical consumption and other healthcare. Going beyond our earlier work, measures of health include life expectancy and disability-adjusted life expectancy (DALE). Also, we consider the impact of obesity. The sample was 18 Organization of Economic Cooperation and Development (OECD) countries. The measure of pharmaceutical consumption is the best that is available for these countries. MAIN OUTCOME MEASURES AND RESULTS: Confirming our earlier work, pharmaceutical consumption has a positive and statistically significant effect on life expectancy at 40 and 60 years (significant at the 0.05 level, based on a two-tailed test). The effects are slightly larger than in the earlier work. Turning to DALE, pharmaceutical consumption has a positive and statistically significant effect at birth and at 60 years (significant at the 0.05 and 0.01 levels, respectively), based on a two-tailed test. The effects on DALE are larger than the effects on life expectancy. CONCLUSIONS: Increased pharmaceutical consumption helps improve quality of life, as well as life expectancy.

Developed Countries↗

Is there a link between pharmaceutical consumption and improved health in OECD countries?

OBJECTIVE: The objective of this study was to determine whether there is a measurable health return associated with high pharmaceutical consumption in a sample of developed countries. DESIGN AND SETTING: The study focused on the production of health, disaggregating healthcare into pharmaceuticals and other healthcare. We controlled for wealth and lifestyle factors. The sample consisted of 21 Organization for Economic Cooperation and Development (OECD) countries and the measure of pharmaceutical consumption used was the best available for a large number of OECD countries. We proxied health with life expectancies at birth, at age 40, and age 60. MAIN OUTCOME MEASURES AND RESULTS: Pharmaceutical consumption had a positive and statistically significant effect on remaining life expectancy at age 40 and 60 years (significant at the 0.10 and 0.05 level, respectively, based on a 2-tailed test), although the effect on life expectancy at birth was small and not significant. Sensitivity analysis showed that these results were generally robust. A significant effect of pharmaceutical consumption on infant mortality was not demonstrated and results of the infant mortality model were very sensitive to small changes. CONCLUSIONS: Increased pharmaceutical consumption helps improve mortality outcomes, especially for those at middle age and older.

Adult↗

Managed care, distance traveled, and hospital market definition.

Does managed care insurance require patients to travel farther to receive hospital care? This question has major implications for antitrust policy and access to care. In spite of a general presumption that the answer is "yes," the question cannot be settled by a priori reasoning. Managed care has two effects on distance: 1) the direct effect of steering managed care consumers to particular hospitals, and 2) the indirect effect of higher managed care market share changing the market environment for consumers in general. The net effect of managed care on distance traveled could go either way. This paper measures both direct and indirect effects in a unique application of a spatial interaction model. We use individual discharge data, including payer information, from hospitals in 14 California counties over the period 1984-1993. We find that the direct effect leads to longer distances, but the indirect effect leads to shorter distances. Neither effect is large. Surprisingly, the net effect is slightly negative.

California↗

Exclusive contracts between hospitals and physicians: the antitrust issues.

Exclusive contracts between hospitals and physicians are common. In most instances they raise no anticompetitive concerns. However, especially in rural markets, exclusive contracts may be used to foreclose actual and potential competitors and thereby decrease competition. The courts should weigh the benefits and costs of exclusive contracts in these areas.

Antitrust Laws↗

Consumer information, price, and nonprice competition among hospitals.

The results of the empirical analysis in this paper indicate that broadly defined hospital quality declines in more concentrated markets. The direction of the effect of concentration on hospital charges is smaller and the direction is less clear. Prices are little, if any, lower in more concentrated markets. Hospital price-cost margins are higher in more concentrated markets. Higher concentration discourages price competition. The data do not support the increasing monopoly theory. Further, since hospital price-cost margins do not appear to remain constant, we must reject the redundant resources theory as well, though its stress on nonprice competition rings true. The empirical results are consistent with the traditional antitrust theory. In addition, consumer information plays a surprisingly important role. Consumer information is important in explaining hospital prices, and less important in hospital quality. Consumers are not passive; they do play a role in hospital choice. It is likely that more recent innovations in health insurance will increase consumer awareness. With an increase in consumer copayments, and more active insurer contracting, it is likely that future hospital competition is more likely to stress price, and future antitrust activity could lead to price reductions in addition to declining hospital price-cost margins.

Antitrust Laws↗

Competition among health insurers, revisited.

This paper updates our 1977 study of health insurance competition. We find that insurers are now far more willing to compete by controlling costs. Large consumer copayments and insurer utilization controls, once deemed politically infeasible, have become commonplace. HMOs and especially PPOs are booming. Blue Shield and Blue Cross market share and market power are declining. We discuss why the insurance market has changed and conclude with thoughts on the future.

Attitude↗