Seminar in Applied Economics: Mark Duggan

OCT 26, 2021 | 12:15 PM TO 1:45 PM

Professor Mark Duggan

Details

WHERE:

Online Event

WHEN:

October 26, 2021: 12:15 PM-1:45 PM

ADMISSION:

Free

SPONSOR:

Ph.D. in Economics

Description

Fall 2021 Seminar in Applied Economics will feature Mark Duggan. Professor Duggan will be presenting on "Getting the Price Right? The Impact of Competitive Bidding in the Medicare Program”

This is an online event. Please register here to participate via Zoom.
Please note that this seminar will not be recorded.

Abstract:
We study Medicare’s competitive bidding program (CBP) for durable medical equipment (DME). We exploit Medicare claims data to examine both prices and utilization, focusing on continuous positive airway pressure (CPAP) devices to treat sleep apnea. We find that spending falls by 47.2% percent after a highly imperfect bidding mechanism is introduced. The effect is almost entirely driven by a 44.8% price reduction, though quantities also fall by 4.3%. To disentangle supply and demand, we leverage differential cost sharing across Medicare recipients. We measure a demand elasticity of -0.272 and find that quantity reductions are concentrated among less clinically appropriate groups.