Colleen Marie Carey

Assistant Professor of Policy Analysis and Management, Cornell University

An economist by training, my research focuses on the industrial organization of health care, with special attention to federal regulation of health insurance markets. I am a Faculty Research Fellow at the National Bureau of Economic Research. Previously, I was a Robert Wood Johnson Scholar in Health Policy Research at the University of Michigan and a Staff Economist at the Council of Economic Advisers.

My research informs the design of publicly-subsidized health insurance markets such as the Affordable Care Act marketplaces. I am particularly interested in the success of federal regulations, such as reinsurance and risk adjustment, in neutralizing adverse selection in these markets. In other research, I have studied how the financial relationships between physicians and drug firms affect prescribing behavior, and the success of state policies that aim to interdict prescription opioid abuse.

Curriculum Vitae

Working Papers

Drug Firms' Payments and Physicians' Prescribing Behavior in Medicare Part D, with Ethan Lieber and Sarah Miller (revision requested)

In a pervasive but controversial practice, drug firms frequently make monetary or in-kind payments to health care providers. Critics are concerned that drug firms are distorting prescribing behavior away from the best interests of patients, while defenders of the practice claim that payments arise from the need to educate providers about changing drug technologies. Using two different identification strategies, we investigate the effect of payments from drug firms on patient-level prescribing behavior in Medicare Part D. We find that patients whose prescribers receive payments from a drug firm tend to increase expenditure on that firm's drugs. Our methods account for the selection of prescribers into payments (which may result if, e.g., pharmaceutical firms target payments to high volume prescribers) and our finding holds even when we look over time within patients who move residences and change to a new prescriber. However, using hand-collected efficacy data on four major therapeutic classes, we also find that those receiving payments prescribe higher-quality drugs on average. In addition, we examine four case studies of major drugs going off patent. Prescribers receiving payments from the firms experiencing the patent expiry transition their patients just as quickly to generics as prescribers who do not receive such payments. Our results have implications for the regulation of interactions between drug firms and physicians such as the Physician Payments Sunshine Act.

Sharing the Burden of Subsidization: Evidence on Pass-Through from a Payment Revision in Medicare Part D (under review)

In many federally-subsidized insurance markets, insurers are subsidized on the basis of enrollee diagnoses; in principle, diagnosis-specific subsidies make insurers indifferent between individuals with different diagnoses. Between 2010 and 2011, the diagnosis-specific subsidies in Medicare Part D were revised, sharply changing the subsidy for each diagnosis. This paper uses the response of insurers to the subsidy update to estimate pass-through of government subsidies to consumer benefits. We compute that an extra dollar in diagnosis-specific subsidies reduced out-of-pocket costs for the typical enrollee by about $0.40. We document heterogeneity in the pass-through rate across insurer market share, insurer market concentration, and the market power of upstream drug firms. We also show insurers' response to the revision's improved alignment between subsidies and expenditures. Finally, we leverage the subsidy revision to obtain a new estimate of prescription drug demand elasticity.

The Impact of Insurance Expansions on the Already Insured: The Affordable Care Act and Medicare, with Sarah Miller and Laura Wherry (under review)

Some states that have not adopted the Affordable Care Act (ACA) Medicaid expansions have stated concerns that the expansions may impair access to care and utilization for those who are already insured. We investigate such negative spillovers using a large panel of Medicare beneficiaries. Across many subgroups and outcomes, we find no evidence that the expansions reduced utilization among Medicare beneficiaries, and can rule out all but very small changes in utilization or spending. These results suggest that the expansions in Medicaid did not impair access to care or utilization for the Medicare population.

How Well Do Doctors Know Their Patients? Evidence from a Mandatory Access Prescription Drug Monitoring Program, with Thomas Buchmueller and Giacomo Meille (under review)

Many opioid control policies target the prescribing behavior of health care providers. In this paper, we study the first comprehensive state-level policy requiring providers to access patients' opioid history before making prescribing decisions. We compare prescribers in Kentucky, which implemented this policy in 2012, to those in a control state, Indiana. Our difference-in-differences analysis uses the universe of prescriptions filled in the two states to assess the how the information provided affected prescribing behavior. As many as forty percent of low-volume opioid prescribers stopped prescribing opioids altogether after the policy was implemented. Among other providers, the primary margin of response was to prescribe opioids to approximately sixteen percent fewer patients. While providers disproportionately discontinued treating patients whose opioid histories suggested the use of multiple providers, there were also economically-meaningful reductions for patients without multiple providers and single-use acute patients.

Why Does Disability Increase During Recessions? Evidence from Medicare, with Nolan Miller and David Molitor (drafted)



Health Policy