The authors estimate the effects of market structure on hospital costs using a translog multiproduct cost function. Recognizing the multiplicity of services provided by hospitals, the results show that costs are substantially determined by service configuration, and that there are distinct economies of size and sco pe. The model also distinguishes market concentration measures by servic e type, including obstetrics, radiation therapy, diagnostic imaging, a nd surgery. Estimates show that, after controlling for the other determinants of cost, the degree of competition has only modest cost-increasing effects. Copyright 1992 by MIT Press.

Enrollment in health maintenance organizations (HMO's) has grown rapidly in recent years as both employers and policymakers attempt to constrain health-care spending. Despite the potential cost savings linked to managed-care insurance, critics contend that the financial incentives of such plans will elicit undertreatment and possibly constrain treatment options for persons with costly medical conditions. For example, one study found that heart-attack patients enrolled in HMO's were less likely to undergo either arteriography or coronary bypass surgery than were persons with indemnity insurance (Gary Young and Bruce Cohen, 1991). However, no prior study has investigated whether enrollment in a managed-care plan influences the choice of a particular hospital for inpatient procedures. Given the growth of HMO' s, it is important to assess whether this form of insurance affects treatment and hospital choices. We analyze whether type of insurance (HMO, other private, Medicaid, or no insurance) affects treatment and hospital choices for nonelderly women with breast cancer. We estimate a model of the choice between breastconserving surgery (BCS) and modified radical mastectomy (MRM), and the decision to seek care at the nearest hospital with a program approved by the American College of Surgeons (hereafter called cancer hospital) versus a more distant hospital. Our analysis treats these choices as jointly determined and examines the influence of type of insurance on both decisions. We study breast for two reasons. First, this disease is the most prevalent form of among women and ranks as the second major cause of death in the female population. Second, in 1990 the National Institutes of Health issued guidelines stating that BCS accompanied by lymph-node dissection and radiation therapy is the recommended treatment protocol for women with early-stage breast (NIH Consensus Conference, 1991). Yet, despite the change in guidelines, the use of BCS remains relatively low.

Measurement error may be an important source of bias in studies using self-reported health indicators to explain work behavior. As a test of measurement error, the tetrachoric correlation coefficient is used to examine the relationship between two alternative measures of arthritis, a standard self-reported measure and a simulated clinical measure. While the two measures are highly correlated, measurement error is found. Regression analysis demonstrates that it varies systematically across different socioeconomic groups. In particular, individuals who are not working tend to report their health incorrectly, perhaps owing to social pressure to justify not having a job. Coauthors are Richard V. Burkhauser, Jean M. Mitchell, and Theodore P. Pincus. Copyright 1987 by MIT Press.

We examine the effect of undiagnosed memory disorders on credit outcomes using individually-matched nationally representative credit reporting and Medicare data. We find effects of early stage disease, years before diagnosis, on a wide range of financial outcomes, including credit card account payment delinquency and amount of delinquent balance, credit utilization among credit card account holders, mortgage delinquency and delinquent balance amount, and credit scores. Effects are pervasive, affecting seniors in single and coupled households, racial/ethnic minorities and non-minorities, and older adults living in areas with higher and lower education levels. Early stage effects are greater among singles and Black individuals.