What Does a Provider Network Do? Evidence from Random Assignment in Medicaid Managed Care

89 Pages Posted: 24 Mar 2020

See all articles by Jacob Wallace

Jacob Wallace

Yale University - School of Public Health

Date Written: May 7, 2019

Abstract

A distinguishing feature of health insurance plans in the United States is the breadth of their provider networks. To study how provider networks impact consumers, I leverage a natural experiment in New York where 50,000 Medicaid recipients were randomly assigned to plans with different provider networks. Assignment to a narrower network reduced healthcare spending and consumer satisfaction, but not quality. I then examine the mechanisms by which narrower networks affect consumers and propose an alternative assignment policy that reduces spending without harming satisfaction. This is achieved by matching recipients with narrower networks that nevertheless include their usual source of care.

Keywords: health economics, health care, Medicaid

JEL Classification: H75, I11, I18

Suggested Citation

Wallace, Jacob, What Does a Provider Network Do? Evidence from Random Assignment in Medicaid Managed Care (May 7, 2019). Available at SSRN: https://ssrn.com/abstract=3544928 or http://dx.doi.org/10.2139/ssrn.3544928

Jacob Wallace (Contact Author)

Yale University - School of Public Health ( email )

PO Box 208034
60 College Street
New Haven, CT 06520-8034
United States

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
17
Abstract Views
135
PlumX Metrics