How Would Medicare for All Affect Health System Capacity? Evidence from Medicare for Some

68 Pages Posted: 9 Nov 2020

See all articles by Jeffrey P. Clemens

Jeffrey P. Clemens

University of California, San Diego (UCSD) - Department of Economics; NBER

Joshua D. Gottlieb

National Bureau of Economic Research (NBER); University of Chicago

Jeffrey Hicks

University of Toronto

Multiple version iconThere are 2 versions of this paper

Date Written: November 9, 2020

Abstract

Proposals to create a national health care plan such as “Medicare for All” rely heavily on reducing the prices that insurers pay for health care. These changes affect physicians’ short-run incentives for care provision and may also change health care providers’ incentives to invest in capacity, thereby influencing the availability of care in the long term. We provide evidence on these responses using a major Medicare payment change combined with survey data on physicians’ time use. We find evidence that physicians increase their time spent on capacity building when remuneration increases, and that they are subsequently more willing to accept new patients – especially those who may be the residual claimants on marginal capacity. These forces imply that short-run supply curves likely differ from long-run supply curves. Policymakers need to account for how major changes to payment incentives would influence the investments that determine health system capacity.

JEL Classification: H51,I11,I13

Suggested Citation

Clemens, Jeffrey P. and Gottlieb, Joshua D. and Gottlieb, Joshua D. and Hicks, Jeffrey, How Would Medicare for All Affect Health System Capacity? Evidence from Medicare for Some (November 9, 2020). University of Chicago, Becker Friedman Institute for Economics Working Paper No. 2020-159, Available at SSRN: https://ssrn.com/abstract=3727520 or http://dx.doi.org/10.2139/ssrn.3727520

Jeffrey P. Clemens

University of California, San Diego (UCSD) - Department of Economics ( email )

9500 Gilman Drive
La Jolla, CA 92093-0508
United States

HOME PAGE: http://econweb.ucsd.edu/~j1clemens/

NBER ( email )

1050 Massachusetts Avenue
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Joshua D. Gottlieb (Contact Author)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

HOME PAGE: http://papers.nber.org/authors/joshua_gottlieb

University of Chicago ( email )

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Chicago, IL 60637
United States

HOME PAGE: http://www.gottlieb.ca/

Jeffrey Hicks

University of Toronto ( email )

Toronto, Ontario M5S 3G7
Canada

HOME PAGE: http://https://jeffrey-hicks.com/

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