What does a pack of cigarettes cost a smoker, the smoker's family, and society? This longitudinal study on the private and social costs of smoking calculates that the cost of smoking to a 24-year-old woman smoker is $86,000 over a lifetime; for a 24-year-old male smoker the cost is $183,000. The total social cost of smoking over a lifetime—including both private costs to the smoker and costs imposed on others (including second-hand smoke and costs of Medicare, Medicaid, and Social Security)—comes to $106,000 for a woman and $220,000 for a man. The cost per pack over a lifetime of smoking: almost $40.00. The first study to quantify the cost of smoking in this way, or in such depth, this accessible book not only adds a weapon to the arsenal of antismoking messages but also provides a framework for assessment that can be applied to other health behaviors. The findings on the effects of smoking on Medicare and Medicaid will be surprising and perhaps controversial, for the authors estimate the costs to be much lower than the damage awards being paid to 46 states as a result of the 1998 Master Settlement Agreement.
This study assesses the impact of certificate-of-need (CON) regulation for hospitals on various measures of health spending per capita, hospital supply, diffusion of technology, and hospital industry organization. Using a time series cross-sectional methodology, we estimate the net impact of CON policies on costs, supply, technology diffusion, and industry organization, controlling for area characteristics, the presence of other forms of regulation, such as hospital rate-setting, and competition. Mature CON programs are associated with a modest (5 percent) long-term reduction in acute care spending per capita, but not with a significant reduction in total per capita spending. There is no evidence of a surge in acquisition of facilities or in costs following removal of CON regulations. Mature CON programs also result in a slight (2 percent) reduction in bed supply but higher costs per day and per admission, along with higher hospital profits. CON regulations generally have no detectable effect on diffusion of various hospital-based technologies. It is doubtful that CON regulations have had much effect on quality of care, positive or negative. Such regulations may have improved access, but there is little empirical evidence to document this.
This study assesses the determinants of conversions in hospital ownership from 1986 through 1996. To place such changes in context, we also analyze causes of hospital mergers and closures, which are often alternatives to hospital ownership conversion. A consistent result from our analysis is that an important antecedent of ownership conversions is a low profit margin. Conversions from private nonprofit or government ownership to for-profit status are preceded by chronically low margins and high debt-to-asset ratios. By contrast, conversions from for-profit ownership occur quickly following declines in margins. Many mergers seem motivated by a desire to increase market power—a consideration not evident for conversions.
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