Public Payment Mandates and Provider Supply

Lauren Hoehn-Velasco (), Yu-Ting Huang () and Olanrewaju Yusuff
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Lauren Hoehn-Velasco: Georgia State University
Yu-Ting Huang: Georgia State University
Olanrewaju Yusuff: Georgia State University

No 18149, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Public insurance reimbursement policies shape the structure and reach of healthcare markets. In this study, we examine the 1980 federal Medicaid mandate requiring states to reimburse Certified Nurse-Midwives, one of the first reforms targeting non-physician providers. We find the mandate increased midwife-attended deliveries by 1.1 percentage points, an 80% rise, adding about 1,100 midwife births annually per state by 1985. We also document a geographic expansion of midwife services into unserved areas and increased hospital employment, consistent with supply-side labor market responses. Our findings demonstrate that reimbursement mandates directly alter healthcare delivery by expanding provider use and reshaping the workforce.

Keywords: non-physician provider; public insurance; certified nurse-midwife; maternal health; Medicaid reimbursements; health insurance. (search for similar items in EconPapers)
JEL-codes: H51 H75 I11 I13 I18 (search for similar items in EconPapers)
Date: 2025-09
New Economics Papers: this item is included in nep-lma and nep-pbe
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