Publications by authors named "Michael Geruso"

6 Publications

  • Page 1 of 1

Upcoding: Evidence from Medicare on Squishy Risk Adjustment.

J Polit Econ 2020 Mar 29;12(3):984-1026. Epub 2020 Jan 29.

Harvard Medical School.

In most US health insurance markets, plans face strong incentives to "upcode" the patient diagnoses they report to the regulator, as these affect the risk-adjusted payments plans receive. We show that enrollees in private Medicare plans generate 6% to 16% higher diagnosis-based risk scores than they would under fee-for-service Medicare, where diagnoses do not affect most provider payments. Our estimates imply that upcoding generates billions in excess public spending and significant distortions to firm and consumer behavior. We show that coding intensity increases with vertical integration, suggesting a principal-agent problem faced by insurers, who desire more intense coding from the providers with whom they contract.
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http://dx.doi.org/10.1086/704756DOI Listing
http://www.ncbi.nlm.nih.gov/pmc/articles/PMC7384673PMC
March 2020

Do Larger Health Insurance Subsidies Benefit Patients or Producers? Evidence from Medicare Advantage.

Am Econ Rev 2018 Aug;108(8):2048-87

University of Chicago Booth School of Business, 5807 South Woodlawn Avenue, Chicago, IL 60637

A central question in the debate over privatized Medicare is whether increased government payments to private Medicare Advantage (MA) plans generate lower premiums for consumers or higher profits for producers. Using difference‑in‑differences variation brought about by a sharp legislative change, we find that MA insurers pass through 45 percent of increased payments in lower premiums and an additional 9 percent in more generous benefits. We show that advantageous selection into MA cannot explain this incomplete pass‑through. Instead, our evidence suggests that market power is important, with premium pass‑through rates of 13 percent in the least competitive markets and 74 percent in the most competitive.
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August 2018

Sanitation, Disease Externalities and Anaemia: Evidence From Nepal.

Econ J (London) 2018 Jun 7;128(611):1395-1432. Epub 2017 Aug 7.

University of Texas at Austin, Indian Statistical Institute.

Anaemia impairs physical and cognitive development in children and reduces human capital accumulation. The prior economics literature has focused on the role of inadequate nutrition in causing anaemia. This article is the first to show that sanitation, a public good, significantly contributes to preventing anaemia. We identify effects by exploiting rapid and differential improvement in sanitation across regions of Nepal between 2006 and 2011. Within regions over time, cohorts of children exposed to better community sanitation developed higher haemoglobin levels. Our results highlight a previously undocumented externality of open defaecation, which is today practiced by over a billion people worldwide.
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http://dx.doi.org/10.1111/ecoj.12491DOI Listing
http://www.ncbi.nlm.nih.gov/pmc/articles/PMC6001781PMC
June 2018

Selection in Health Insurance Markets and Its Policy Remedies.

J Econ Perspect 2017;31(4):23-50

Harvard Medical School, Boston, Massachusetts.

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http://dx.doi.org/10.1257/jep.31.4.23DOI Listing
April 2018

Tradeoffs in the design of health plan payment systems: Fit, power and balance.

J Health Econ 2016 May 10;47:1-19. Epub 2016 Feb 10.

National Bureau of Economic Research (NBER), United States; Department of Health Care Policy, Harvard Medical School, United States.

In many markets, including the new U.S. Marketplaces, health insurance plans are paid by risk-adjusted capitation, sometimes combined with reinsurance and other payment mechanisms. This paper proposes a framework for evaluating the de facto insurer incentives embedded in these complex payment systems. We discuss fit, power and balance, each of which addresses a distinct market failure in health insurance. We implement empirical metrics of fit, power, and balance in a study of Marketplace payment systems. Using data similar to that used to develop the Marketplace risk adjustment scheme, we quantify tradeoffs among the three classes of incentives. We show that an essential tradeoff arises between the goals of limiting costs and limiting cream skimming because risk adjustment, which is aimed at discouraging cream-skimming, weakens cost control incentives in practice. A simple reinsurance system scores better on our measures of fit, power and balance than the risk adjustment scheme in use in the Marketplaces.
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http://dx.doi.org/10.1016/j.jhealeco.2016.01.007DOI Listing
http://www.ncbi.nlm.nih.gov/pmc/articles/PMC4836985PMC
May 2016

Black-white disparities in life expectancy: how much can the standard SES variables explain?

Authors:
Michael Geruso

Demography 2012 May;49(2):553-74

Department of Economics, Princeton University, Princeton, NJ 08544, USA.

This article quantifies the extent to which socioeconomic and demographic characteristics can account for black-white disparities in life expectancy in the United States. Although many studies have investigated the linkages between race, socioeconomic status, and mortality, this article is the first to measure how much of the life expectancy gap remains after differences in mortality are purged of the compositional differences in socioeconomic characteristics between blacks and whites. The decomposition is facilitated by a reweighting technique that creates counterfactual estimation samples in which the distribution of income, education, employment and occupation, marital status, and other theoretically relevant variables among blacks is made to match the distribution of these variables among whites. For males, 80% of the black-white gap in life expectancy at age 1 can be accounted for by differences in socioeconomic and demographic characteristics. For females, 70% percent of the gap is accounted for. Labor force participation, occupation, and (among women only) marital status have almost no additional power to explain the black-white disparity in life expectancy after precise measures for income and education are controlled for.
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http://dx.doi.org/10.1007/s13524-011-0089-1DOI Listing
May 2012