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I am a Ph.D. candidate in the Department of Economics at UC Berkeley. My fields of interest are industrial organization, health economics, and public economics. I study the interaction between principal-agent relationships and classic IO questions of market structure and productivity, primarily in the health care industry.

During the 2019-2020 academic year, I will be a postdoctoral associate at the Tobin Center for Economic Policy at Yale. From 2020 onwards, I will be an assistant professor at the Harris School of Public Policy at the University of Chicago.

Contact:
zarek{at}berkeley.edu


Job Market Paper:
"Intermediation and Vertical Integration in the Market for Surgeons" (with Mathijs de Vaan) [revised draft coming soon! email me for the old one.]
Health care markets are increasingly dominated by large, highly-integrated systems. Understanding the impact of this integration on market outcomes is central to designing good antitrust and regulatory policy. Integration presents a central efficiency trade-off: It may improve the productive efficiency of care through coordination between primary care providers (PCPs) and specialists, but it may also reduce allocative efficiency by allowing systems to distort PCPs’ care recommendations through encouragement to steer patient referrals towards affiliated specialists. We study how these forces shape referrals to orthopedic joint surgeons in Massachusetts. We find that both are present, but that internal referrals are primarily driven by anticompetitive steering rather than efficiencies, and removing steering incentives would reduce internal referrals by over half. Counterintuitively, dis-integrating health systems would increase expected costs by 5%. We find that this is explained by the absence of referral cost-sensitivity. In the status quo, the only forces that improve allocative efficiency are the steering efforts of low-cost systems. We study insurers' attempts to enhance competition through the use of "global budget" capitation contracts, which force PCPs to bear a share of the cost of their referrals. We find that the introduction of capitation contracts do introduce cost-sensitivity and shift referrals towards orthopedists who are 3-6% less expensive. Nonetheless, these incentives would need to have 42% stronger effects to offset the efficiency losses of dis-integration.

Publications:
Quarterly Journal of Economics, 2017, 132(3): 1261-1318
[Online Appendix]
Measuring consumer responsiveness to medical care prices is a central issue in health economics and a key ingredient in the optimal design and regulation of health insurance markets. We study consumer responsiveness to medical care prices, leveraging a natural experiment that occurred at a large self-insured firm which forced all of its employees to switch from an insurance plan that provided free health care to a non-linear, high deductible plan. The switch caused a spending reduction between 11.79%-13.80% of total firm-wide health spending. We decompose this spending reduction into the components of (i) consumer price shopping (ii) quantity reductions (iii) quantity substitutions, finding that spending reductions are entirely due to outright reductions in quantity. We find no evidence of consumers learning to price shop after two years in high-deductible coverage. Consumers reduce quantities across the spectrum of health care services, including potentially valuable care (e.g. preventive services) and potentially wasteful care (e.g. imaging services). We then leverage the unique data environment to study how consumers respond to the complex structure of the high-deductible contract. We find that consumers respond heavily to spot prices at the time of care, and reduce their spending by 42% when under the deductible, conditional on their true expected end-of-year shadow price and their prior year end-of-year marginal price. In the first-year post plan change, 90% of all spending reductions occur in months that consumers began under the deductible, with 49% of all reductions coming for the ex ante sickest half of consumers under the deductible, despite the fact that these consumers have quite low shadow prices. There is no evidence of learning to respond to the true shadow price in the second year post-switch.
Media Coverage: New York Times [Economic View]New York Times [The Upshot]Washington Post [Wonkblog]Washington Post [Health & Science]Vox [1]Vox [2]CBS MoneywatchMarketplaceThe Conversation
This paper won the 24th Annual NIHCM Foundation Research Award in 2018.

Work in progress:
"Understanding Active Choice in Subsidized Medicare Part D" (with Tim Layton, Boris Vabson, and Adelina Yanyue Wang)

"The Incidence of Paperwork in Medicine: Authorization Restrictions in Medicaid" (with Boris Vabson)

"Productivity Spillovers and the Underprovision of Hospital Performance Incentives"