All About Health Care

Hello everyone! My name is Eytan, and I’m a rising senior majoring in Economics at William and Mary. This Summer, I will be working on two projects related to health care. First, I will be working with my advisor, Professor He, on examining changes in Medicare legislation. Medicare is a government sponsored form of health care primarily for individuals over the age of 65 (younger individuals with  specific types of disabilities are also eligible).  In 2000, Medicare changed the way in which outpatient hospital expenses were reimbursed. Previously, outpatient hospital visits were reimbursed based on the exact cost of the treatments. Under the new legislation, the Outpatient Prospective Payment System, expenses are classified into different categories , depending on the type of treatment. Thus, the exact cost of the expenses is not reimbursed, but rather a set amount is paid based on the classification of the treatment. This change in policy could affect how much medication patients receive , and how likely they are to receive outpatient surgery.

In order to assess these changes,  I will be assisting Professor He in analyzing a database (Medical Expenditure Panel Survey) that provides information on how outpatient hospital expenses have been reimbursed through time.  We will use econometric analysis to examine the relationship between the new legislation and changes in the way patients are treated. To do this, I will make use of a statistical program called STATA which is found on computers across campus.

The other part of my research will be an independent side project, in which I examine the relationship between obesity and medical spending. Obesity is a health concern that has received increased attention in recent years.  I will be trying to identify if there is a cause and effect relationship between obesity and increased medical spending, or if they are merely correlated. I will do this by gathering data from the Medical Expenditure Panel Survey, and running regressions to pinpoint the relationship. One of the main concerns is controlling for other variables. For example, obesity is likely correlated with increased medical spending, but the real cause for this could be heart problems.  The ability to understand if obesity in of itself results in higher medical spending could prove useful in determining future healthy policy.

I look forward to sharing more information about both of these projects  once I arrive on campus over the Summer.