How Do Hospitals Respond to Medicaid Managed Care? Evidence from Low Birth Weight Infants in New York

Ajin Lee
Despite widespread adoption across the United States, there is little empirical evidence on whether Medicaid managed care (MMC) reduces costs without compromising health outcomes. This paper exploits an arbitrary component of MMC enrollment in New York to examine the causal effects of MMC on hospital responses and newborn health. During the study period, infants with birth weight below 1,200 grams were excluded from MMC and were instead served through the traditional fee-for-service (FFS) system. Using...
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