Christopher Ody

More Insurers Lower Premiums: Evidence from Initial Pricing in the Health Insurance Marketplaces

First-year insurer participation in the Health Insurance Marketplaces (HIMs) established by the Affordable Care Act is limited in many areas of the country. There are 3.9 participants, on (population-weighted) average, in the 395 ratings areas spanning the 34 states with federally facilitated marketplaces (FFMs). Using data on the plans offered in the FFMs, together with predicted market shares for HIM participants (estimated using 2011 insurer-state market shares in the individual insurance market), we study the impact of competition on premiums. We exploit variation in ratings-area-level competition induced by UnitedHealthcares decision not to participate in any of the FFMs. We estimate that the second-lowest-price silver premium (which is directly linked to federal subsidies) would have decreased by 5.4 percent, on average, had UnitedHealthcare participated. If all insurers active in each states individual insurance market in 2011 had participated in all ratings areas in that states HIM, we estimate this key premium would be 11.1% lower and 2014 federal subsidies would be reduced by

Evolving Measures of Provider Market Power

1.7 billion.

The Effect of Hospital Acquisitions of Physician Practices on Prices and Spending

Many researchers assess the impact of provider market structure and market power on outcomes such as price. These studies use a variety of measures of structure and power, ranging from ad hoc measures often based on census boundaries to structural measures derived from economic models of provider-payer bargaining. We explain the shortcomings of ad hoc measures, and, through a series of “horse races” show that one leading structural measure, the “willingness to pay,” is a consistently better predictor of prices.

How do nonprofits respond to negative wealth shocks? The impact of the 2008 stock market collapse on hospitals

During the past decade, U.S. hospitals have acquired a large number of physician practices. For example, from 2007 to 2013, hospitals acquired nearly 10% of the practices in our sample. We find that the prices for the services provided by acquired physicians increase by an average of 14.1% post-acquisition. Nearly half of this increase is attributable to the exploitation of payment rules. Price increases are larger when the acquiring hospital has a larger share of its inpatient market. We find that integration of primary care physicians increases enrollee spending by 4.9%.

Another Look at Credit Card Pricing and its Disclosure: Is the Semi-Annual Pricing Data Reported by Credit Card Issuers to the Fed Helpful to Consumers or Researchers?

The theory of cost shifting posits that nonprofit firms “share the pain” of negative financial shocks with their stakeholders, for example, by raising prices. We examine how nonprofit hospitals responded to the sharp reductions in their assets caused by the 2008 stock market collapse. The average hospital did not raise prices, but hospitals with substantial market power did cost shift in this way. We find no evidence that hospitals reduced treatment costs. Hospitals eliminated but left unchanged their offerings of profitable services. Taken together, our results provide mixed evidence on whether nonprofits behave differently from for-profits.

Uncompensated Care Decreased At Hospitals In Medicaid Expansion States But Not At Hospitals In Nonexpansion States

Credit Card Pricing Developments and Their Disclosure,” a January 2003 Payment Cards Center Discussion Paper, examined the history and dynamics of credit card pricing and how such pricing is described to consumers in Truth in Lending solicitation disclosures. In this paper, we examine credit card pricing as revealed to consumers in a different context: that of a semiannual shopping guide that the Board of Governors publishes pursuant to the Truth in Lending Act. Specifically, we ask two questions: Are the data on credit card pricing in the guide useful to consumers? Are the data collected for the guide (commonly known as Terms of Credit Card Plan [TCCP] data) of value to researchers? With respect to both of these questions, we find that the data are becoming less useful.