Veronica Grembi

Does Experience Rating Improve Obstetric Practices? Evidence from Geographical Discontinuities in Italy

Using data from 2002 to 2009 inpatient discharge records on deliveries in the Italian region of Piedmont, we assess the impact of an increase in malpractice pressure on obstetric practices, as identified by the introduction of experience-rated malpractice liability insurance. Our identification strategy exploits the exogenous location of public hospitals in court districts with and without schedules for noneconomic damages. We perform difference-in-differences and difference-in-discontinuities analyses. We find that the increase in medical malpractice pressure is associated with a decrease in the probability of performing a C-section from 2.3 to 3.7 percentage points (7% to 11.6% at the mean value of C-section) with no consequences for a broadly defined measure of complications or neonatal outcomes. We show that these results are robust to the different methodologies and can be explained by a reduction in the discretion of obstetric decision making rather than by patient cream skimming.

Curb your premium: The impact of monitoring malpractice claims

We study a policy aimed at increasing the level of information on medical malpractice costs and the risk exposure of local public healthcare providers. The policy is based on enhanced monitoring of medical malpractice claims by the level of government that rules providers in a multilevel institutional setting. In particular, we implement a difference-in-differences strategy using Italian data at the provider level from 2001 to 2008 to evaluate the impact of monitoring claims on medical liability expenditures, measured as insurance premiums and legal expenditures, which was adopted by only some Regions. Our results show that this information-enhancing policy reduces paid premiums by around 15%. This reduced-form effect might arise by higher bargaining power on the demand side or increased competition on the supply side of the insurance market. Validity tests show that our findings are not driven by differential pre-policy trends between treated and control providers. Moreover, this policy could be cheaply implemented also in other institutional contexts with positive effects.

Delays in Medical Malpractice Litigation in Civil Law Jurisdictions: Some Evidence from the Italian Court of Cassation

Medical malpractice law and tort reform are contentious issues. In this paper, we focus on Italy as an example of a civil law jurisdiction. Italian medical malpractice law is essentially judge-made law. However, its effectiveness is likely to be curtailed by excessive delays in litigation. Several reforms have been enacted since the late 1980s to correct this situation. By making use of the decisions of the Italian Court of Cassation (which have shaped medical malpractice law) from 1970 to 2009, we show that these reforms had no general statistically significant impact on delays. Recent reduction of delays does not seem to be related to legal reforms but rather explained by other factors.

Would You Trust an Italian Politician? Evidence from Italian Regional Politics

This chapter evaluates the erosion of electoral accountability of the “Governors” of the Italian Regions in three subsequent political moments: (1) the elections, (2) the inaugural speeches of the Governor, (3) their first important policy decision, the long-term regional budget (DPEFR). We use content analysis (Laver et al. 2003) to assess the position of each Governor on a left to right distribution at the moment of the inaugural speeches and of the DPEFR. We then analyze the correlation between the distributions of (1) the electoral results and the inaugural speeches and (2) the inaugural speeches and the DPEFR, under the hypothesis that greater similarity can be interpreted as greater accountability. The analysis detects some erosion of accountability from the elections to the inaugural speeches, and a more serious one from the inaugural speeches to the DPEFR. A series of ANOVA tests suggest that the Region’s relative economic position/dependency on transfers from the central governments partly explains such loss of accountability.

Does Experience Rating Improve Obstetric Practices? Evidence from Italy

Using inpatient discharge records from the Italian region of Piedmont, we estimate the impact of an increase in malpractice pressure brought about by experience-rated liability insurance on obstetric practices. Our identification strategy exploits the exogenous location of public hospitals in court districts with and without schedules for noneconomic damages. We perform difference-in-differences analysis on the entire sample and on a subsample which only considers the nearest hospitals in the neighborhood of court district boundaries. We find that the increase in medical malpractice pressure is associated with a decrease in the probability of performing a C-section from 2.3 to 3.7 percentage points (7-11.6%) with no consequences for medical complications or neonatal outcomes. The impact can be explained by a reduction in the discretion of obstetric decision-making rather than by patient cream skimming.

The More Public the More Private? The Case of the Italian Childcare

Childcare availability is regarded as an important factor in the evaluation of public policies for both sustaining fertility and increasing women participation to the labour market. However, the recent empirical literature shows that the extension of the public supply of childcare mainly crowds out private providers. Italy is a case of special interest for testing the relationship between the pub- lic and private supply of childcare given that: 1) an increase in public childcare provision can be achieved through broadly conceived forms of out-sourcing; 2) public childcare for children less than 3 years old can be considered as a ser- vice with high redistributive goals, which determines a sorting mechanism of the demand between public and private providers. We use Italian data at the munic- ipality level for the period 2000-2006 to explain the number of registered private providers of childcare as a function of 1) the public coverage of the 0-2 years old population, and 2) the main characteristics of the public service. We show that the public coverage positively a¤ects the number of private providers. When the characteristics of public supply are considered, the e¤ect of a sorting mechanism is con?rmed.

The political economy of diagnosis-related groups☆

A well-established political economic literature has shown as multi-level governance affects the inefficiency of public expenditures. Yet, this expectation has not been empirically tested on health expenditures. We provide a political economy interpretation of the variation in the prices of 6 obstetric DRGs using Italy as a case study. Italy offers a unique institutional setting since its 21 regional governments can decide whether to adopt the national DRG system or to adjust/waive it. We investigate whether the composition and characteristics of regional governments do matter for the average DRG level and, if so, why. To address both questions, we first use a panel fixed effects model exploiting the results of 66 elections between 2000 and 2013 (i.e., 294 obs) to estimate the link between DRGs and the composition and characteristics of regional governments. Second, we investigate these results exploiting the implementation of a budget constraint policy through a difference-in-differences framework. The incidence of physicians in the regional government explains the variation of DRGs with low technological intensity, such as normal newborn, but not of those with high technological intensity, as severely premature newborn. We also observe a decrease in the average levels of DRGs after the budget constraint implementation, but the magnitude of this decrease depends primarily on the presence of physicians among politicians and the political alignment between the regional and the national government. To understand which kind of role the relevance of the political components plays (i.e., waste vs. better defined DRGs), we check whether any of the considered political economy variables have a positive impact on the quality of regional obstetric systems finding no effect. These results are a first evidence that a system of standardized prices, such as the DRGs, is not immune to political pressures.

Evaluating the Efficiency of the Italian Penitentiary System

In the aftermath of an official general pardon in 2006 Italian penitentiaries are struggling with overcrowding and budgeting problems. In order to identify the main causes of such difficulties we analyze an unbalanced panel of 142 Italian penitentiaries for the time period 2003-2005. A primary source of inefficiency is identified in unexploited economies of scale. In addition, estimation of a stochastic cost frontier highlights significant technical inefficiency, mainly attributable to overstaffing. Average prison size and technical efficiency are both smaller in the South than in the rest of the country.

The Imperialistic Aim of Economics: At the Origin of the Economic Analysis of Law

During the last decades there has been an impressive debate on what should be considered the future of the application of economic tools to the study of the legal system. Such debate is particularly compelling while many countries, which do not belong to the common law area – original backstage for the modern Law and Economics –, have been showing sympathetic reception trends of that application. The paper addresses these ‘future concerns’ moving from the origins of the Economic Analysis of Law. The relationship between Economic Imperialism, a phenomenon arising in the late fifties/early sixties in Economics, and the Economic Analysis of Law is analyzed, while sketching the different approaches of Gary Becker and Ronald Coase. Moving to legal scholars’ works, the methodological premises of Richard Posner and Guido Calabresi’s works are mentioned as well. The main conclusion is that the real peculiarity of the studies in Law and Economics after 1960 consists in advances beyond the limited Pigovian definition of externality. Hence, the future of the discipline does not stem from the colonization of new legal systems, but from the acknowledgement of the potentialities of a ‘market failure approach’.

Courts, Scheduled Damages, and Medical Malpractice Insurance

Medical malpractice insurance is considered a unprofitable market in many countries, and this is why many policies have been implemented to increase its attractiveness for private insurers. We test the effects of limits to noneconomic compensations- scheduled damages- using Italian data. We estimate the average treated effect of schedules and whether it depends on the judicial efficiency, measured as court backlog. Our identification rests on the partial overlap between healthcare authorities districts and judicial districts, thus the caseload of a court and malpractice events at the healthcare provider level are not perfectly correlated. On average, the adoption of schedules does not produce any significant effect on insurers and paid premiums. However, it has a robust and significant effect on the number of insurers only in inefficient courts. We further investigate these findings using data for 17,578 malpractice insurance claims. We find evidence of a composition effect among claims which is triggered by higher levels of judicial inefficiency: the more inefficient a court, the lower the probability to have a case not decided on the merits, and the higher the level of reserve and recovery per claim. These results shed light on previous conflicting evidence in the literature.