The Essential Scan: Top Findings in Health Policy Research | Edition 76

What’s the latest in health policy research? The Essential Scan, produced by the Schaeffer Initiative for Health Policy, aims to help keep you informed on the latest research and what it means for policymakers. To sign up to receive the Essential Scan straight to your inbox, sign up here

Taxes on E-Cigarettes Increase Conventional Smoking Among Adults

Working paper by: Henry Saffer, Daniel L. Dench, Michael Grossman, and Dhaval M. Dave

E-cigarettes are generally considered to be less harmful than conventional cigarettes for adults because the vapor produced does not contain the toxins and nitrosamines that are found in tobacco smoke. While e-cigarettes may be effective in helping smokers quit, the literature is limited on how their use interacts with conventional cigarette use and cessation efforts. A new study looks at the impacts on use and smoking cessation when e-cigarettes are taxed at the rate of tobacco products. The researchers leverage a large e-cigarette tax hike in Minnesota, which extended the definition of tobacco products to include e-cigarettes, rather than categorizing them as nicotine replacement products, which are not taxed in the state. The researchers found that higher e-cigarette taxes led to an increase in adult smoking rates and a reduction in the number of people who quit smoking. The implication is that e-cigarettes are a substitute for conventional cigarettes among current smokers and furthermore, taxes on e-cigarettes deter adult smokers from quitting. Given the high response to the tax, the researchers predict that about 32,400 additional smokers would have quit smoking in Minnesota in the absence of the tax. However, the researchers also stress that the public health benefits of not taxing e-cigarettes must be weighed against efforts to reduce use in teens and young adults. Full study here.

Does Healthcare Hotspotting Work?

Study by: Amy Finkelstein, Anetta Zhou, Sarah Taubman, and Joseph Doyle

In the U.S. 5 percent of the population accounts for 50 percent of annual healthcare spending, and 1 percent accounts for nearly a quarter of annual spending. Some programs now target these “superutilizers” in an effort to reduce healthcare costs. One high profile program is the Camden Coalition of Healthcare Providers “Hot Spotters” program. It identifies “superutilizers” and uses a face-to-face care model to engage patients and connect them to appropriate care, government benefits, and community service. The Coalition partnered with investigators to conduct a prospective randomized control trial to gauge the program’s effectiveness in reducing unnecessary healthcare utilization and costs. “Superutilizer” participants were randomized into treatment and control groups. Investigators found that the intervention had no significant effect on participants’ 180-day hospital readmission rate. This contrasts with results from earlier randomized studies of similar efforts in the Medicare program, which found a significant reduction in readmissions. Authors attributed differences to the Camden study’s younger and more medically complex population. The contrast with results from observational studies was attributed to regression to the mean, which was clearly seen in the behavior of the Camden control group. This study highlights the challenges of reducing hospital readmission rates in medically and socially complex “superutilizer” populations. Full study here.

Medicaid Expansion and the Unemployed

Working paper by: Thomas C. Buchmueller, Helen G. Levy, and Robert G. Valletta

The ACA Medicaid expansion increased health insurance coverage for low-income people, which some claim has the potential to increase periods of unemployment by removing the incentive to work in order to receive employer-sponsored health insurance coverage. A recent paper looks into this theory by drawing comparisons between states that expanded Medicaid and those that did not. The authors find no evidence that increased access to subsidized health insurance led to delays in finding or starting a job. Overall, between 2013 and 2017, the reduction in the uninsured rate for unemployed individuals in states that expanded Medicaid was nearly twice as large as the reduction in states that did not expand the program. The study also looked at the effects Medicaid expansion had on access to care for the unemployed and showed that in expansion states, the unemployed had fewer care delays and fewer instances of individuals having no usual source of healthcare compared to non-expansion states. The authors conclude that Medicaid expansion was successful in increasing coverage without unintentionally affecting job search and labor force attachment. Full study here.

Medicare’s Bundled Payment for Joint Replacement Program Associated with Decrease in Spending for Some and No Change in Quality

Study by: Amol S. Navathe, Ezekiel J. Emanuel, Atheendar S. Venkataramani, Qian Huang, et al

Bundled payment for lower extremity joint replacement (LEJR) surgeries has been prioritized by CMS, first through a 2013 program and more recently in 2018 through the Bundled Payments for Care Improvement (BPCI) Advanced Model, both voluntary programs. A new study evaluates the impact of the model on outcomes and spending, paying particular attention to the effects of patient selection and participation. It found participation in the BPCI initiative was associated with a 1.6 percent decrease in average LEJR spending over three years, with no changes in quality outcomes. Reductions in spending were driven primarily by early program participants, indicating that program savings were not generalizable across participants. Authors found that unobserved patient selection accounted for 27 percent of episode savings, suggesting that participating programs may have avoided patients perceived to have poor social support or low treatment adherence, which were not accounted for in the analysis. The authors note that these results are important to consider as CMS continues to expand voluntary bundled payment through the BPCI Advanced Program. Full study here.

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The Essential Scan is produced by the USC-Brookings Schaeffer Initiative for Health Policy, a collaboration between the Brookings Institution and the USC Schaeffer Center for Health Policy & Economics.