David L. Weimer

Information and effort in contingent valuation surveys: application to global climate change using national internet samples ☆

This contingent valuation study investigates the issues of information access and respondent effort, and is based on a series of national Internet samples. The focus is on a split-sample treatment, Basic Information (BI) versus Enhanced Information (EI). In the latter, significantly expanded information is provided about global climate change and the Kyoto Protocol. Using a referendum format, we compare the treatment effect (BI versus EI) on willingness to pay (WTP). We develop measures of respondent effort in accessing optional information, through the technology of Web-based surveys, and jointly model effort and WTP using a simultaneous estimation approach. Results support the use of the joint modeling approach for objective measures of respondent effort and WTP. Respondent effort is shown to be positively and significantly related to WTP. However, use of the optional menu is rather modest (counts of pages and time spent), and is highly variable (both across pages and respondents).

Early identification and treatment of Alzheimer's disease: Social and fiscal outcomes

Alzheimers disease (AD) is a progressive neurodegenerative disease that places substantial burdens on those who provide support for family members with declining cognitive and functional abilities. Many AD patients eventually require formal long‐term care services because of the absence, exhaustion, or inability of family members to provide care. The costs of long‐term care, and especially nursing home care, often deplete private financial resources, placing a substantial burden on state Medicaid programs. Current evidence suggests that pharmacological treatments and caregiver interventions can delay entry into nursing homes and potentially reduce Medicaid costs. However, these cost savings are not being realized because many patients with AD are either not diagnosed or diagnosed at late stages of the disease, and have no access to Medicare‐funded caregiver support programs.

Quality Report Cards, Selection of Cardiac Surgeons, and Racial Disparities: A Study of the Publication of the New York State Cardiac Surgery Reports

Quality report cards have become common in many health care markets. This study evaluates their effectiveness by examining the impact of the New York State (NYS) Cardiac Surgery Reports on selection of cardiac surgeons. The analyses compares selection of surgeons in 1991 (pre-report publication) and 1992 (post-report publication). We find that the information about a surgeons quality published in the reports influences selection directly and diminishes the importance of surgeon experience and price as signals for quality. Furthermore, selection of surgeons for black patients is as sensitive to the published information as is the selection for white patients.

Government Supply and Government Production Failure: A Framework Based on Contestability

A complete conceptual framework for policy analysis requires a theory of government supply and government production failure to complement the well-developed theory of market failure provided by welfare economics. Charles Wolf has made an important start by attempting to draw parallels between market failures and the manifestations of government supply failures. This article provides a more useful analytical framework for government supply failure in two important ways. First, it draws on several perspectives from the economics of organization to sketch both normative and positive theories of government supply. Second, it uses the positive theory of government supply behavior to make direct comparisons with the traditional market failures. It concludes with some implications of the framework for assessing the potential gains from privatization.

Does risk adjustment of the CMS quality measures for nursing homes matter

Background:The Centers for Medicare and Medicaid Services (CMS) publish a report card for nursing homes with 19 clinical quality measures (QMs). These measures include minimal risk adjustment. Objectives:To develop QMs with more extensive risk adjustment and to investigate the impact on quality rankings. Research Design:Retrospective analysis of individual level data reported in the Minimum Data Set (MDS). Random effect logistic models were used to estimate risk adjustment models for 5 outcomes: pressure ulcers for high and low risk patients, physical restraints, and pain for long- and short-stay patients. These models were used to create 5 QMs with extended risk adjustment, enhanced QMs (EQMs). The EQMs were compared with the corresponding QMs. Subjects:All (17,469) nursing homes that reported MDS data in the period 2001–2005, and their 9.6 million residents. Measures:QMs were compared with EQMs for all nursing homes in terms of agreement on outlier identification: Kappa, false positive and false negative error rates. Results:Kappa values ranged from 0.63 to 0.90. False positive and negative error rates ranged from 8% to 37%. Agreement between QMs and EQMs was better on high quality rather than on low quality. Conclusions:More extensive risk adjustment changes quality ranking of nursing homes and should be considered as potential improvement to the current QMs. Other methodological issues related to construction of the QMs should also be investigated to determine if they are important in the context of nursing home care.

An Assessment of Important Issues Concerning the Application of Benefit-Cost Analysis to Social Policy

Benefit-cost analysis (BCA) provides a framework for systematically assessing the efficiency of public policies. Increasingly, BCA is being applied to social policies, ranging from preschool interventions to prison reentry programs. These applications offer great potential for helping to identify policies that offer the best returns on public investments aimed at helping the disadvantaged or otherwise improving social life. However, applying BCA to social policies pose a number of challenges. The need for a comprehensive approach to assessing social policies generally requires making predictions based on data from multiple sources and using available shadow prices. As these predictions and shadow prices are inherently uncertain, special effort must be made to explicitly address the resulting uncertainty of predictions of net benefits. Prediction and valuation are complicated by behaviors, such as addiction, that do not clearly satisfy the assumptions of neoclassical welfare economics. As distributional goals are often an explicit motivation for social policies, BCA may be an incomplete framework for public policy purposes unless analysts can find ways to incorporate peoples willingness to pay for changes in the distribution of consumption across society. If BCA is to reach its potential for contributing to good social policy, analysts must be aware of these challenges and researchers must help address them.

The Economic and Political Liberalization of Socialism: The Fundamental Problem of Property Rights

All our previous political experience, and especially, of course, the experience of Eastern Europe and Central Asia, offers little hope that democracy can coexist with the centralized allocation of economic resources. Indeed, simple observation suggests that a market economy with private property rights is a necessary, although not sufficient, condition for the existence of a democratic political regime. And this accords fully with the political theory of liberalism, which emphasizes that private rights, both civil and economic, be protected and secure. At the same time, our previous experience also indicates that market economies are more successful than centrally planned economies not only in producing, but also in distributing, both private and collective goods. This economic experienee is supported by neoclassical economic theory, which treats clearly defined and secure rights to private property as essential to a market economy.

Cost–benefit analysis involving addictive goods: contingent valuation to estimate willingness‐to‐pay for smoking cessation

The valuation of changes in consumption of addictive goods resulting from policy interventions presents a challenge for cost-benefit analysts. Consumer surplus losses from reduced consumption of addictive goods that are measured relative to market demand schedules overestimate the social cost of cessation interventions. This article seeks to show that consumer surplus losses measured using a non-addicted demand schedule provide a better assessment of social cost. Specifically, (1) it develops an addiction model that permits an estimate of the smokers compensating variation for the elimination of addiction; (2) it employs a contingent valuation survey of current smokers to estimate their willingness-to-pay (WTP) for a treatment that would eliminate addiction; (3) it uses the estimate of WTP from the survey to calculate the fraction of consumer surplus that should be viewed as consumer value; and (4) it provides an estimate of this fraction. The exercise suggests that, as a tentative first and rough rule-of-thumb, only about 75% of the loss of the conventionally measured consumer surplus should be counted as social cost for policies that reduce the consumption of cigarettes. Additional research to estimate this important rule-of-thumb is desirable to address the various caveats relevant to this study.

Strategic Orientation and Nursing Home Response to Public Reporting of Quality Measures: An Application of the Miles and Snow Typology

OBJECTIVE To assess whether differences in strategic orientation of nursing homes as identified by the Miles and Snow typology are associated with differences in their response to the publication of quality measures on the Nursing Home Compare website. DATA SOURCES Administrator survey of a national 10 percent random sample (1,502 nursing homes) of all facilities included in the first publication of the Nursing Home Compare report conducted in May-June 2004; 724 responded, yielding a response rate of 48.2 percent. STUDY DESIGN The dependent variables are dichotomous, indicating whether or not action was taken and the type of action taken. Four indicator variables were created for each of the four strategic types: Defender, Analyzer, Prospector, and Reactor. Other variables were included in the seven logistic regression models to control for factors other than strategic type that could influence nursing home response to public disclosure of their quality of care. DATA COLLECTION/EXTRACTION METHODS Survey data were merged with data on quality measures and organizational characteristics from the first report (November 2002). PRINCIPAL FINDINGS About 43 percent of surveyed administrators self-typed as Defenders, followed by Analyzers (33 percent), and Prospectors (19 percent). The least self-selected strategic type was the Reactor (6.6 percent). In general, results of the regression models indicate differences in response to quality measure publication by strategic type, with Prospectors and Analyzers more likely, and Reactors less likely, to respond than Defenders. CONCLUSIONS While almost a third of administrators took no action at all, our results indicate that whether, when, and how nursing homes reacted to publication of federally reported quality measures is associated with strategic orientation.

Is There Evidence of Cream Skimming among Nursing Homes following the Publication of the Nursing Home Compare Report Card

PURPOSE A national quality report card for nursing homes, Nursing Home Compare, has been published since 2002. It has been shown to have some, albeit limited, positive impact on quality of care. The objective of this study was to test empirically the hypothesis that nursing homes have responded to the publication of the report by adopting cream skimming admission policies. DESIGN AND METHODS The study included all non-Medicare newly admitted patients to all Medicare- and Medicaid-certified nursing homes nationally during the 2001-2005 period. Using the Minimum Data Set data, we calculated for each quarter several admission cohort characteristics: average number of activity of daily living limitations and percent of residents admitted with pain, with pressure ulcers, with urinary incontinence, with diabetes, and with memory limitations. We tested whether residents admitted in the postpublication period were less frail and sick compared with residents admitted in the prepublication period by estimating fixed facility effects longitudinal regression models. Analyses were stratified by nursing home ownership, occupancy, reported quality ranking, chain affiliation, and region. RESULTS Evidence for cream skimming was found with respect to pain and, to a lesser degree, with respect to memory limitation but not with respect to the 4 other admission cohort characteristics. IMPLICATIONS Despite the theoretical expectation, empirical evidence suggests only a limited degree of cream skimming. Further studies are required to investigate this phenomenon with respect to other admission cohort characteristics and with respect to post-acute patients.