Medicaid Policy, Physician Behavior, and Health Care for the Low-Income Population


Concerns about the health of poor children and mothers produced major changes in the Medicaid public insurance program during the last decade, including expansions in program eligibility and increases in fees paid to physicians who care for covered patients. We examine physician responses to Medicaid policy changes aimed at improving care for pregnant women in order to understand the effects of Medicaid policy on physician behavior as well as to study the effectiveness of the expansions in improving access to care. We find that expanded eligibility for Medicaid did increase access to physician services. However, contrary to the findings of some previous studies, increases in access are only apparent for the physicians in “public” institutions such as public clinics and hospital clinics; we find no evidence that increases in eligibility increase access to the physicians in our sample who are based in private offices. Our evidence also suggests that the impact of fees on physician behavior may be smaller than previous estimates would imply. We find that increases in fees are associated with increases in service to poor populations by these young private physicians, but some of this increase simply reflects shifting of patients from “public” sites to private physician offices. JEL Classification Codes: I1, I3, H51 We thank Jonathon Gruber, Janet Currie, Joel Cohen, and John Holahan for graciously providing data on Medicaid eligibility and fees, Sharmila Shankarkumar for her able research assistance, and Jere Behrman, Randy Ellis, Jonathan Gruber, Sean Nicholson, Brigitte Madrian, John Pencavel, Julie Schaffner, and seminar participants at the 1997 Health Economics Conference at the University of Minnesota, the 1997 Society of Labor Economists meetings, the 1997 AEA meetings, the 1996 NBER Summer Institute, the Public Policy Institute of California's labor economics meeting, and Tulane University for their helpful comments on earlier drafts of this paper.

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@inproceedings{Baker1996MedicaidPP, title={Medicaid Policy, Physician Behavior, and Health Care for the Low-Income Population}, author={Laurence C. Baker and Anne Beeson Royalty and Jonathon Gruber and Janet M. Currie and Joel Cohen and John Holahan and Sharmila Shankarkumar and Jere R Behrman and Randy E. Ellis and Jonathan H. Gruber and Sean Nicholson and Brigitte C. Madrian and John Pencavel and Julie W Schaffner}, year={1996} }