Affordable care encourages healthy living: Theory and evidence from China's new cooperative medical scheme.

In developing a theory of medical insurance and health behavior with bequest motive, we discover that whether ex ante moral hazard or the opposite occurs hinges upon the differential effects of health behavior on morbidity and mortality. Providing insurance can encourage healthy living by making longevity more affordable. We test the theory utilizing a unique experiment of China introducing the new cooperative medical scheme, unique in its long-term credibility necessary for our proposed channel. This scheme reduced cigarette use by around 9%. Further empirical analysis failed to falsify our theory or the alternative mechanism of health insurance reducing stress and thus the demand for cigarettes and hard liquor. Both newly proposed mechanisms alleviate concerns over ex ante moral hazard caused by providing affordable care for the poor.

The Association Between Local Economic Conditions and Opioid Prescriptions Among Disabled Medicare Beneficiaries.

BACKGROUND: This paper concerns public health crises today-the problem of opioid prescription access and related abuse. Inspired by Case and Deaton's seminal work on increasing mortality among white Americans with lower education, this paper explores the relationship between opioid prescribing and local economic factors. OBJECTIVE: We examined the association between county-level socioeconomic factors (median household income, unemployment rate, Gini index) and opioid prescribing. SUBJECTS: We used the complete 2014 Medicare enrollment and part D drug prescription data from the Center for Medicare and Medicaid Services to study opioid prescriptions of disabled Medicare beneficiaries without record of cancer treatment, palliative care, or end-of-life care. MEASURES AND RESEARCH DESIGN: We summarized the demographic and geographic variation, and investigated how the local economic environment, measured by county median household income, unemployment rate, Gini index, and urban-rural classification correlated with various measures of individual opioid prescriptions. Measures included number of filled opioid prescriptions, total days' supply, average morphine milligram equivalent (MME)/day, and annual total MME dosage. To assess the robustness of the results, we controlled for individual and other county characteristics, used multiple estimation methods including linear least squares, logistic regression, and Tobit regression. RESULTS AND CONCLUSIONS: Lower county median household income, higher unemployment rates, and less income inequality were consistently associated with more and higher MME opioid prescriptions among disabled Medicare beneficiaries. Geographically, we found that the urban-rural divide was not gradual and that beneficiaries in large central metro counties were less likely to have an opioid prescription than those living in other areas.