Industry Input in Policymaking: Evidence from Medicare / David C. Chan, Jr, Michael J. Dickstein.

Format:

Book

Author/Creator:

Chan, David C, Jr.

Contributor:

National Bureau of Economic Research.

Dickstein, Michael J.

Series:

Working Paper Series (National Bureau of Economic Research) no. w24354.

NBER working paper series no. w24354

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Industry Input in Policymaking

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2018.

Summary:

In setting prices for physician services, Medicare solicits input from a committee that evaluates proposals from industry. We investigate whether this arrangement leads to prices biased toward the interests of committee members. We find that increasing a measure of affiliation between the committee and proposers by one standard deviation increases prices by 10%, demonstrating a pathway for regulatory capture. We then evaluate the effect of affiliation on the quality of information used in price-setting. More affiliated proposals produce less hard information, measured as lower quality survey data. However, affiliation results in prices that are more closely followed by private insurers, suggesting that affiliation may increase the total information used in price-setting.

Notes:

Print version record

February 2018.