Ashley Swanson

Papers

"Physician Ownership and Incentives: Evidence from Cardiac Care" (Job Market Paper)
Physician ownership of hospitals is highly controversial. Proponents argue that physician ownership leads to higher-quality care, while opponents claim that physician-investors “cherry- pick” profitable patients. This paper uses a new data source on physician-owned hospitals to evaluate the extent of physician-owner cherry-picking and to estimate the mortality effect of treatment at a physician-owned hospital after controlling for patient selection. The data contain information on the distribution of physician ownership variables across hospitals and I develop a probabilistic discrete choice framework to examine the selection behavior of physician-investors relative to non-owners. A structural approach with instrumental variables is used to provide estimates of hospital quality both on average and varying with patient characteristics. The model is estimated on a dataset of non-emergency cardiac patients obtained from the Center for Medicare and Medicaid Services. Sample patients were treated at 287 hospitals in 29 markets containing either a physician-owned hospital or a cardiac specialty hospital. I find that unobservable patient selection across hospitals does not substantially bias estimates of quality in reduced form estimation; both reduced form and instrumental variables estimates show evidence of a significant mortality improvement at physician-owned hospitals. This improvement primarily holds for moderate-severity patients. Further, there is no strong evidence of physician-owner cherry-picking of healthier patients. The distribution of patients across hospitals is primarily driven by physicians’ average preferences over hospitals.

“Heterogeneity in High Math Achievement Across Schools: Evidence from the American Mathematics Competitions” (with Glenn Ellison)
This paper explores differences in the frequency with which students from different schools reach high levels of math achievement. Data from the American Mathematics Competitions is used to produce counts of high-scoring students from more than two thousand public, non-magnet U.S. high schools. High-achieving students are found to be far from evenly distributed. There are strong demographic predictors of high achievement, and large differences among seemingly similar schools. The unobserved heterogeneity across schools includes a thick tail of schools that produce many more high-achieving students than the average school. Gender-related differences and other breakdowns are also discussed.

"The Gender Gap in Secondary School Mathematics at High Achievement Levels: Evidence from the American Mathematics Competitions" (with Glenn Ellison)
This paper uses a new data source, American Mathematics Competitions, to examine the gender gap among high school students at very high achievement levels. The data bring out several new facts. There is a large gender gap that widens dramatically at percentiles above those that can be examined using standard data sources. An analysis of unobserved heterogeneity indicates that there is only moderate variation in the gender gap across schools. The highest achieving girls in the U.S. are concentrated in a very small set of elite schools, suggesting that almost all girls with the ability to reach high math achievement levels are not doing so.

Research in Progress

“A Dynamic Model of Prescription Drug Utilization” (with Jonathan Gruber and Jason Abaluck)
Medicare Part D creates a non-linear pricing schedule for prescription drugs in which current prices depend on total expenditures to date. Relative price changes across coverage ranges generally differ between generic and branded drugs. We estimate a dynamic model of drug consumption as a function of the full price schedule. We examine how consumption varies as individuals pass between coverage ranges, and we estimate own- and cross-price elasticities at different points in time and at different locations on the pricing schedule. Our theoretical model predicts that consumption should be insensitive to price changes occurring at inframarginal coverage ranges unless individuals are myopic or “schmedule” by overresponding to average or current prices (Liebman and Zeckhauser 2004). The empirical analysis uses a dataset provided by the Center for Medicare and Medicaid Services, which provides all prescription drug claims for a random sample of Part D enrollees.

“Estimating Reclassification Risk: A Dynamic Selection Model” (with Nathan Hendren)
Health expenditure risk evolves over time, yet health insurance contracts cover limited time horizons and thus may leave enrollees exposed to “re-classification risk,” whereby future insurance prices respond to changes in risk. This paper seeks to characterize the dynamic distribution of health expenditure risk and to estimate the extent of re-classification risk in markets with and without pricing regulations. Our results to date indicate substantial correlation in health expenditure across time, particularly after the incurrence of chronic health conditions. Despite this, individual insurance contracts do not respond significantly to enrollees' changing risk, suggesting insurers may commit to dynamic contracts. However, health shocks have a substantial impact on the uninsured. In markets without price regulation, uninsured individuals are significantly more likely to enroll in public programs such as Medicaid after experiencing adverse health shocks, but are still very likely to remain uninsured. In contrast, in states with price regulations, adverse health shocks are more likely to lead the uninsured to acquire private insurance. In ongoing work, we are developing a dynamic discrete choice model to estimate the extent of insurance obtained in the presence of evolving health risk and a patchwork of insurance schemes with different dynamic properties.

“The Effects of Price Transparency Efforts on Health Care Prices: Evidence from Hospital Charges”
In recent decades, more than thirty states have enacted regulations requiring hospitals to publish some or all of their prices, citing the potential for consumer search to lead to greater competition and lower costs in health care markets. This paper uses longitudinal state inpatient data to evaluate the effect of two types of price-posting regulations, Web-based posting requirements and on-site posting requirements, on the distribution of hospital prices. I find that transparency regulation is associated with significant price decreases, but these results pertain only for admissions that are primarily elective in nature and in more concentrated markets. I also find evidence of lower price dispersion for elective admissions and in specialized hospitals after the institution of transparency regulations.