Interstate occupational licensure compacts are an increasingly popular way of addressing provider shortages in mental healthcare markets. I study the effects of licensure compacts on the size and composition of the psychologist workforce. I develop an empirical model of entry for psychologists differentiated by whether they provide in-person or virtual care. Results show that the Psychologist Interjurisdictional Compact increased overall supply by 2.9 psychologists per market but decreased in-person supply by 0.59 psychologists. Fifty-three percent of this decline is attributable to increased competitive pressure from out-of-state therapists. While geographic license portability increases supply, it reduces access to in-person care.

Reject and Resubmit, Journal of Human Resources

Are state-imposed behavioral remedies effective substitutes for federal antitrust enforcement? We evaluate state regulation of hospital mergers under Certificates of Public Advantage (COPAs). Using hospital data from 1996-2022, we compare COPA-regulated mergers to unregulated mergers with similar anticompetitive potential. In highly concentrated markets, COPA mergers result in 11.1 p.p. lower price growth but 0.5 p.p. greater increases in 30-day mortality rates. We find a negative correlation between price and mortality effects for COPA mergers, consistent with theoretical predictions that binding price caps exacerbate quality deterioration. Our findings suggest that COPA contracts are poor substitutes for traditional antitrust enforcement.

NBER working paper #34373 

Revise and Resubmit, International Journal of Industrial Organization

We show that nonlinear pricing terms in vertical contracts significantly affect medical decisions. We compare fee-for-service (FFS) versus bundled payment (BP) contracts between insurers and healthcare practices focusing on medical decisions for childbirth. We find that covering c-sections under FFS increases c-section rates by 20% relative to baseline and the marginal woman undergoing a c-section is healthier. Conversely, covering vaginal deliveries under FFS reduces c-section rates by 35%. Effects are explained mainly by differences between the two contracts in prices for marginal ancillary services. Despite large shifts in procedure choices, maternal and infant outcomes are the same under both contracts.