Joan Costa-Font

Competition in off-patent drug markets: Issues, regulation and evidence

In recent years health insurers have placed a great deal of emphasis on the ability of generic medicines to deliver significant savings to overstretched health care budgets due to their lower cost and potential for a more efficient resource allocation. In this paper we study market developments after patent expiry, whether health insurance captures the financial benefits from cheaper generics, and whether regulation and product differentiation, among others, have any power in explaining originator and generic price movements, generic entry and diffusion. We find that health insurance does not capitalize fully or fast enough on the cost advantage of generic medicines, either because generic policies do not encourage their fast uptake, or because generic drug prices are high and frequently tied, directly or indirectly, to originator drug prices. We also find that reference pricing, a particular form of reimbursement regulation, encourages generic entry and reduces generic prices but only marginally. Finally, in generic markets characterized by homogeneous products, we find evidence of product differentiation which is impacting prices upwards rather than downwards. If health insurance is to benefit fully from generic medicines, it ought to encourage faster uptake and price competition, and discourage price-fixing regulation that ties generic prices to those of originator brands.

Compulsory language educational policies and identity formation

Education can be at the root of the process of identity formation. Using survey data from Catalonia and the Basque Country, where in 1983 the education system became bilingual, we study how parental choices and schooling interact with each other and contribute to the development of individual identity. The difference between the reforms implemented in the two Spanish regions is that whereas in Catalonia the reform was compulsory, in the Basque Country parents could choose the language used to educate their children. Results show a significant effect of the compulsory language policy implemented in Catalonia on identity, whereas the non-compulsory language policy implemented in the Basque Country does not have any effect.

Social interactions and the contemporaneous determinants of individuals’ weight

Obesity and overweight are central issues in the public health debate in most developed countries. In this debate, some of the socio-economic determinants of obesity and overweight are still relatively unexplored. This paper presents an empirical examination of the possible influence of social interactions on contemporaneous obesity and (over)underweight. A joint estimation model for obesity and self-image is applied to a sample for Spain taken from the European Union household panel for 1998. The results suggest that obesity might be in part a social phenomenon connected to individuals’ social life.

Modelling an entitlement to long-term care services for older people in Europe: projections for long-term care expenditure to 2050

As the numbers of older people rise in Europe, the importance of long-term care services in terms of numbers of users and expenditures can be expected to grow. This article examines the implications for expenditure in four countries of a national entitlement to long-tem care services for all older people, based on assessed dependency. It is based on a European Commission-funded cross-national study, which makes projections to 2050 of long-term care expenditure in Germany, Italy, Spain and the UK. The policy option investigated is based on the German long-term care insurance scheme, which embodies the principle of an entitlement on uniform national criteria to long-term care benefits. The research models this key principle of the German system in the other three participating countries, with respect to home care services. The study finds that, if all moderately/severely dependent older people receive an entitlement to formal (in-kind) home care, the impact on expenditure could be considerable, but would vary greatly between countries. The impact on long-term care expenditure is found to be the least in Germany, where there is already an entitlement to benefits; and the greatest in Spain, where reliance on informal care is widespread. This article discusses the policy implications of these results.

Power rather than path dependency? The dynamics of institutional change under health care federalism.

Proposals for government decentralization rank high on the political reform agenda of health systems worldwide. Their impact on welfare state performance and change, however, is still under theoretical scrutiny. This article examines the impact of devolution on the construction of the Spanish National Health Service (NHS) in an attempt to shed some light on this debate. Against widespread claims of path dependency, we argue that the specific nature of the devolution model developed in Spain, given the more egalitarian sociopolitical structure that resulted from democratization, fostered policy innovation and institutional change. Consolidation of an NHS system was compatible with some regional diversity and apparently prevented the rise of significant territorial inequalities. The Spanish case also suggests that policy change depends more on the distribution of social power than on institutions. It underlines the key role of financial and knowledge transfers vis-à-vis institutional reforms in effecting social change as well as the potential for state intervention in supporting the development of collective action resources by social groups.

The impact of decentralization and inter-territorial interactions on Spanish health expenditure

This paper examines the determinants of regional public health expenditure in a decentralised health system. Unlike previous studies we take into account possible policy and political interactions among authorities, as well as unobserved heterogeneity. Our emprirical contribution lies in running a spatial panel specification using a dataset of all Spanish region states on aggregated and disaggregated health expenditures (pharmaceuticals, inpatient and primary care). Results are consistent with some degree of interdependence between neighboring regions in spending decisions. Empirical evidence of long term efficiency effects of health care decentralisation, suggests that a specific spatial-institutional design might improve the health system efficiency as well as regional cohesion. Political and scale effects are consistent with theoretical predictions.

Measuring inequalities in health: What do we know? What do we need to know?

We argue that policy analysis aiming at curving inequalities in health calls for a better understanding of what we know about its measurement pathways. Assuming that health is a good that individuals trade off against other goods, unavoidable health inequalities result when after controlling for unavoidable factors (e.g., age and gender), differences in socioeconomic status of an individual systemically engender differences in health outcomes. However, the measurement of such inequality and underpinning reasons behind are not suggestive of a clear picture. In reviewing the literature, we conclude that it is unclear what the evidence suggests about the reasons for health inequalities as well as the best possible instruments to measure both inequality and socioeconomic health gradients. We provide an evaluation of the different sources of health inequity and we draw upon measurement issues and their policy significance.

Optimism and the perceptions of new risks.

While many risks, especially new ones, are not objectively quantifiable, individuals still form perceptions of risks using incomplete or unclear evidence about the true nature of those risks. In the case of well known risks, such as smoking, individuals perceive risks to be smaller for themselves than others, exhibiting ‘optimism bias’. Although existing evidence supports optimism bias occurring in the case of risks about which individuals are familiar, evidence does not yet exist to suggest that optimism bias applies for new risks. This paper addresses this question by examining the gap in perceptions of risks individuals have for themselves versus society and the environment, conceptualised as social and/or environmental optimism biases. We draw upon the 2002 UEA‐MORI Risk Survey to examine the existence of optimism bias and its effects on risk perceptions and acceptance regarding five science and technology‐related topics: climate change, mobile phones, radioactive waste, GM food and genetic testing. Our findings provide evidence of social and environmental optimism bias following similar patterns and optimism bias appearing greater for those risks bringing sizeable benefit to individuals (e.g. mobile phone radiation) rather than those more acutely affecting society or the environment (e.g. GM food or climate change). Social optimism bias is found to reduce risk perceptions for risks that have received large amounts of media attention, namely, climate change and GM food. On the other hand, optimism bias appears to increase risk perceptions about genetic testing.

Attitudes as an Expression of Knowledge and “Political Anchoring”: The Case of Nuclear Power in the United Kingdom

Attitudes toward the use of nuclear energy pose fundamental issues in the political debate about how to meet future energy needs. Development of new nuclear power facilities faces significant opposition both from knowledgeable individuals who display an understanding of the risks attached to various forms of power generation and those who follow strict politically based ideological dogmas. This article employs data from a 2005 Eurobarometer survey of UK citizens to examine the influence of both political preferences and knowledge in explaining support of nuclear power. Findings reveal that attitudes about nuclear power are highly politically motivated while the influence of knowledge about radioactive waste is dependent upon beliefs about the consequences of nuclear energy use. Perceptions of being informed about radioactive waste and trust in sources providing information about radioactive waste management also predict attitudes toward nuclear power generation.

Diversity and Regional Inequalities: Assessing the Outcomes of the Spanish 'System of Health Care Services'

The consolidation of a universal health system coupled with a process of regional devolution characterise the institutional reforms of the National Health System (NHS) in Spain in the last two decades. However, scarce empirical evidence has been reported on the effects of both changes in health inputs, outputs and outcomes, both at the country and at the regional level. This paper examines the empirical evidence on regional diversity, efficiency and inequality of these changes in the Spanish NHS using cross-correlation, panel data and expenditure decomposition analysis. Results suggest that besides significant heterogeneity, once we take into account region-specific needs there is evidence of efficiency improvements whilst inequalities in inputs and outcomes, although more ‘visible’, do not appear to have increased in the last decade. Therefore, the devolution process in the Spanish Health System offers an interesting case for the experimentation of health reforms related to regional diversity but compatible with the nature of a public NHS, with no sizeable regional inequalitiest.