Doctoral Dissertation Research in Economics: The Effect of Certified Nurse Midwife Scope-of-Practice Laws on Health Costs, Prices, and Outcomes

Project Outcomes Statement

The U.S. takes an intensive and physician centric approach to infant and maternal healthcare. The most common non-physician providers, Certified Nurse Midwives (CNMs), attended fewer than 10 percent of all U.S. births in 2018. This difference is driven at least in part by Scope-of-Practice (SOP) laws for CNMs. In some U.S. states, the SOP laws require births to be supervised or attended by a physician. For instance, in Missouri all births must be supervised by a physician, whereas in Nevada mothers can choose to use only a CNM. This project estimated the effects of allowing CNMs to practice independently in the U.S by relaxing the SOP laws that govern CNM practice.

This project significantly contributed to our knowledge of whether SOP laws, and other labor market restrictions, impact healthcare costs, affordability, and quality. First, it found that relaxing SOP laws for CNMs reduced the amount of resources used per birth, as measured by hospital facility costs per birth and the rate of intensive procedures, such as cesarean sections. This finding suggests that allowing different types of practitioners more autonomy can significantly alter the way that care is delivered and may make it more affordable. Relaxing SOP laws for CNMs also leads to a reduction in severe complications during birth, suggesting that they improve the quality of care as well.

Additionally, this project uncovered some of the mechanisms by which SOP laws affect hospital facility costs by using detailed data on hospital discharges and developing a new decomposition technique. This decomposition estimates how much of the causal effect of changing SOP laws was due to changes in obstetric unit practice, reallocation of patients to different obstetric units, and entry and exit of obstetric units in the local market. Cost savings are primarily driven by obstetric units adopting more efficient practices for low-risk patients and higher-risk patients selecting into higher-cost hospitals. However, entry of new, lower cost, obstetric units is an important mechanism in markets with relatively few obstetric providers.

The results of the project provide important information for the broader debate on the strictness SOP laws, including the costs and benefits of changing SOP laws. This research is particularly timely as many states have recently taken steps to relax their SOP laws and others are actively considering doing so.

This project substantially added to the collection of discharge data at the National Bureau of Economic Research (NBER). These data are now available for use by all NBER affiliated researchers. Expanding this archive will enable additional high-impact work in health economics. Moreover, by expanding the number of states in NBER’s repository, this proposal will lead to projects that study a more diverse set of populations and allow for more detailed analyses of the distributional consequences of health policies.

The project provided critical support for the Co-PI Chase Eck’s dissertation. In addition to acquiring necessary data, the project supported the development of his skills in economic modeling, econometric techniques, structural estimation, and data management. The paper developed during this project was used as Chase Eck’s primary dissertation chapter. In addition to the dissertation this project produced an academic paper which has been presented at conferences. These presentations disseminated the results to economic researchers, clinical practitioners, and policymakers.