Finance

Massachusetts Links Pay for Performance to the Reduction of Racial and Ethnic Disparities

Massachusetts Links Pay for Performance to the Reduction of Racial and Ethnic Disparities
Health Affairs. 30(6):1165-1175.

Blustein, Jan, Joel Weissman, Andrew M Ryan, Tim Doran and Romana Hasnain-Wynia.
04/01/2011

The Institute of Medicaid has identified equity as a key dimension of quality. Recently, Massachusetts’ Medicaid program (MassHealth) took the unusual step of linking pay-for-performance (P4P) to the reduction of racial/ethnic disparities for hospital care.  We report on early experience with the program, describing the challenges of implementing an ambitious program in a short time frame, with limited resources.  Our findings raise questions about whether P4P as currently constituted is a suitable tool for addressing disparities in hospital care.

The Effect of the MassHealth Hospital Pay-for-Performance Program on Quality

The Effect of the MassHealth Hospital Pay-for-Performance Program on Quality
Health Services Research. 2011:46(3);712-728

Ryan, Andrew M and Jan Blustein.
01/06/2011

Objective. To test the effect of Massachusetts Medicaid's (MassHealth) hospital-based pay-for-performance (P4P) program, implemented in 2008, on quality of care for pneumonia and surgical infection prevention (SIP). Data. Hospital Compare process of care quality data from 2004 to 2009 for acute care hospitals in Massachusetts (N=62) and other states (N=3,676) and American Hospital Association data on hospital characteristics from 2005. Study Design. Panel data models with hospital fixed effects and hospital-specific trends are estimated to test the effect of P4P on composite quality for pneumonia and SIP. This base model is extended to control for the completeness of measure reporting. Further sensitivity checks include estimation with propensity-score matched control hospitals, excluding hospitals in other P4P programs, varying the time period during which the program was assumed to have an effect, and testing the program effect across hospital characteristics. Principal Findings. Estimates from our preferred specification, including hospital fixed effects, trends, and the control for measure completeness, indicate small and nonsignificant program effects for pneumonia (-0.67 percentage points, p>.10) and SIP (-0.12 percentage points, p>.10). Sensitivity checks indicate a similar pattern of findings across specifications. Conclusions. Despite offering substantial financial incentives, the MassHealth P4P program did not improve quality in the first years of implementation.

Assessing the cost of transfer inconvenience in public transport systems: A case study of the London Underground

Assessing the cost of transfer inconvenience in public transport systems: A case study of the London Underground
Transportation Research Part A: Policy and Practice, Vol. 45, 2, 91-104

Guo, Zhan and Nigel H.M. Wilson
01/03/2011

Few studies have adequately assessed the cost of transfers in public transport systems, or provided useful guidance on transfer improvements, such as where to invest (which facility), how to invest (which aspect), and how much to invest (quantitative justification of the investment). This paper proposes a new method based on path choice,3 taking into account both the operator's service supply and the customers' subjective perceptions to assess transfer cost and to identify ways to reduce it. This method evaluates different transfer components (e.g., transfer walking, waiting, and penalty) with distinct policy solutions and differentiates between transfer stations and movements.

The method is applied to one of the largest and most complex public transport systems in the world, the London Underground (LUL), with a focus on 17 major transfer stations and 303 transfer movements. This study confirms that transfers pose a significant cost to LUL, and that cost is distributed unevenly across stations and across platforms at a station.

Transfer stations are perceived very differently by passengers in terms of their overall cost and composition. The case study suggests that a better understanding of transfer behavior and improvements to the transfer experience could significantly benefit public transport systems.

 

Credit is Not a Right

Credit is Not a Right

Gershman, John and Jonathan Morduch.
01/01/2011

Is credit a human right? Muhammad Yunus, the most visible leader of a global movement to provide microcredit to world’s poor, says it should be. NYU’s John Gershman and FAI’s Jonathan Morduch disagree. In their new paper, Credit is Not a Right, they ask whether a rights-based approach to microcredit will in fact be effective in making quality, affordable credit more available to poor families – and, more importantly, whether it is a constructive step in terms of the broader goal of global poverty reduction. Jonathan Morduch argues his case in this video.

Testing Competing Capital Structure Theories of Nonprofit Organizations

Testing Competing Capital Structure Theories of Nonprofit Organizations
Public Budgeting and Finance 31(3): 119-143

Calabrese, Thad,
01/01/2011

The static trade-off and pecking order capital structure theories are analyzed and applied to nonprofit organizations. In addition, this paper also considers how nonprofits adjust their leverage over time. The analyses consider the unique role of donor-restricted endowments in the decision to borrow, as well as different types of borrowing by nonprofits. The results indicate that nonprofit capital structure choices are best explained using the pecking order theory, in which internal funds are preferred over external borrowing. Further, nonprofit endowment is not found to increase leverage. Despite the unambiguous findings across varying definitions of leverage, the results also suggest that a “modified pecking order” is a more apt descriptor of nonprofit behavior.

The Great Recession's Impact on New York City's Budget.

The Great Recession's Impact on New York City's Budget.
Municipal Finance Journal 32(1): 89-113.

Miller, Lawrence J. and Daniel L. Smith.
01/01/2011

Strong property tax growth and proactive policies - including beginning the recession with a substantial surplus of $5.3 billion (9 percent of revenues) - offset a severe contraction in income tax receipts, protecting the City's budget such that it never contracted in absolute terms during or immediately following the Great Recession. Policymakers increased property and sales tax rates, utilized fund balances, cut agency budgets repeatedly, and re-appropriated retiree health benefits in response to the fiscal challenges brought about by the Great Recession. Whether one attributes it to compliance with a strong, state-mandated, balanced budget rule or adept leadership, New York City certainly appears to be dealing effectively with the Great Recession's impact on its budget. However, City leaders have asked lower income residents to bear a substantial portion of the burden by favoring more regressive tax policies and by cutting the social service agency's budget substantially. With forecast budget gaps of $3 billion and $4 billion in FY 2012 and FY 2013, the long-term impact of the Great Recession on New York City's budget remains an open question.

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