Does Managed Care Widen Infant Health Disparities? Evidence from Texas Medicaid

Ilyana Kuziemko, Katherine Meckel and Maya Rossin-Slater

American Economic Journal: Economic Policy, 2018, vol. 10, issue 3, 255-83

Abstract: Medicaid programs increasingly finance competing, capitated managed care plans rather than administering fee-for-service (FFS) programs. We study how the transition from FFS to managed care affects high- and low-cost infants (blacks and Hispanics, respectively). We find that black-Hispanic disparities widen—e.g., black mortality and preterm birth rates increase by 15 percent and 7 percent, respectively, while Hispanic mortality and preterm birth rates decrease by 22 percent and 7 percent, respectively. Our results are consistent with a risk-selection model whereby capitation incentivizes competing plans to offer better (worse) care to low- (high-) cost clients to retain (avoid) them in the future.

JEL-codes: H75 I12 I18 I38 J13 J15 (search for similar items in EconPapers)
Date: 2018
Note: DOI: 10.1257/pol.20150262
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Citations: View citations in EconPapers (8)

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