Recent experimental studies analyze the behavior of physicians towards patients and find that physicians care for their own profit as well as patient benefit. In this paper, we extend the experimental analysis of the physician decision problem by adding a third party which represents the health insurance that finances medical service provision under a prospective payment scheme. Our results show that physicians take into account the payoffs of the third party, which can lead to underprovision of medical care. We conduct a laboratory experiment in neutral as well as in medical framing using students and medical doctors as subjects. Subjects in the medically framed experiments behave weakly and are more patient orientated in contrast to neutral framing. A sample of medical doctors exhibits comparable behavior to students with medical framing.

This paper contributes to the discussion of whether non-indicated ultrasound examinations of the thyroid gland contribute to overtreatment and excess health care expenditures. Using two sources of claims data from Germany, we analyzed data from patients who underwent a TSH blood test which is the initial diagnostic measure to check for possible presence of thyroid dysfunction. In a matching analysis, we compared health costs of two groups of patients. One consisted of patients who underwent an early thyroid ultrasound that according to medical guidelines—at this point—was probably not indicated. The other group consisted of patients, who underwent no ultrasound examination at all or later in the course of the disease, making probable a correct indication. Both groups were made comparable by the means of a matching procedure. Average thyroid-specific health costs were substantially higher for the first group in the quarter in which the ultrasound examination took place. Some deviation in these specific costs persisted over a substantial period of time, with drug expenditures exhibiting the biggest difference. If, however, total health costs were considered, difference in costs was only found in the initial quarter. We conclude that non-indicated ultrasound examination of the thyroid gland may have some moderate effects on thyroid-specific costs. Yet the data do not suggest that long-lasting overtreatment and excess health expenditures are initiated by non-indicated ultrasound in Germany.

We analyze whether the introduction of the general minimum wage in Germany in 2015 had an effect on workers’ self-rated health. To this end, we use survey data linked to administrative employment records and apply difference-in-differences regressions combined with propensity score matching. This approach enables us to control for a vast set of potential confounding variables. We find a health improving effect among the individuals who were most likely to be affected by the reform. Our results indicate that workers’ improved satisfaction with pay, their reduced working hours, and a reduction in time pressure at work may drive this result.

From an economic perspective, marriage and long-term partnership can be seen as a riskpooling device. This informal insurance contract is, however, not fully enforceable. Each partner is free to leave when his or her support is needed in case of an adverse life event. An adverse health shock is a prominent example for such events. Since relationship breakdown itself is an extremely stressful experience, partnership may backfire as informal insurance against health risks, if health shocks increase the likelihood of relationship breakdown. We address this question empirically, using survey data from Germany. Results from various matching estimators indicate that adverse shocks to mental health substantially increase the probability of a couple splitting up over the following two years. In contrast, there is little effect of a sharp decrease in physical health on relationship stability. If at all, physical health shocks that hit both partners simultaneously stabilize a relationship.

This paper analyzes whether moderate weight reduction improves subjective health perception in obese individuals. Besides simple regression models, in a simultaneous equation framework we use randomized monetary weight loss incentives as instrument for weight change, to address possible endogeneity bias. In contrast to related earlier work that also employed instrumental variables estimation, identification does not rely on long-term, between-individuals weight variation, but on short-term, within-individual weight variation. Yet, our result does not suggest that the simple regressions suffer from much endogeneity bias, since instrumental variables estimation yields similar—though far noisily estimated and statistically insignificant—estimates. In qualitative terms, our results do not contradict previous findings pointing to weight loss in obese individuals resulting in improved subjective health. Our results suggest that a reduction of body weight by one BMI unit is associated with an increase in the probability of reporting self-rated health to be ‘satisfactory’ or better by 3 to 4 percentage points. This finding may encourage obese individuals in their weight loss attempts, since they are likely to be immediately rewarded for their efforts by subjective health improvements.