Doctoral Dissertation Research in Economics: The Effect of Certified Nurse Midwife Scope-of-Practice Laws on Health Costs, Prices, and Outcomes
Healthcare in the U.S. often involves costly, capital-intensive interventions. These types of interventions are particularly prevalent in maternal and infant health. However, non-physician providers, such as Certified Nurse Midwives (CNMs), typically have a less resource-intensive practice style and are likely to reduce the costs of giving birth. CNMs are registered nurses with advanced training and are licensed to perform non-surgical obstetric and maternal care. However, their ability to lower costs may be limited by Scope-of-Practice (SOP) laws which require a physician to supervise every case. This project studies whether relaxing SOP laws to give more independence to CNMs can lower the costs and resources associated with giving birth. It will also examine the mechanisms by which more independence for CNMs may generate cost savings. First, more independence may allow CNMs to treat more cases and do so in a less resource intensive way. Second, relaxing SOP laws may lead physicians to adopt a practice style similar to that of CNMs either through learning or changes to hospital policy. Finally, increasing CNM independence may allow physicians to focus on, and more efficiently treat, high-risk patients. Additionally, the project will estimate whether patients benefit from increasing CNM independence. Cost-savings may be passed on to patients via price reductions or improvements in birth outcomes. However, the degree to which cost-savings are passed on to patients may depend on the level of competition in the hospital market. To estimate the effect of relaxing SOP laws this project will leverage quasi-random variation in the strictness of SOP laws across states and time. Using generalized difference-in-differences and event-study methods the study will (1) identify the causal impact of SOP laws on costs; (2) estimate whether these savings are passed on to consumers via reductions in price or increases in quality; (3) examine how market structure mediates these effects; and (4) identify causal mechanisms for the effects of SOP laws. This approach will be able to estimate the causal effect of relaxing SOP laws because it adjusts for fixed differences across states that change their laws and those that do not. The effect is unlikely to be confounded by differential trends in the outcome of interest because political processes drive the timing of SOP law changes and these changes are unrelated to trends in the outcomes of interest. Finally, states adopt new SOP laws at different times, making it unlikely that there are other simultaneous shocks that would confound the effect of the policy. The project’s detailed discharge-level data will enable it to calculate more precise measures of cost and resource use. It will also enable a deeper analysis of the effects of the laws on important sub-groups, such as mothers and infants who are high-risk, members of underserved groups, or living in underserved areas. Finally, the detailed data can help estimate the relative importance of different causal mechanisms.
This project is supported by National Science Foundation under grant number 2018061.
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- Author: Shane Greenstein