Essays in Health Economics
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caputi-tcaputi-phd-econ-2026-thesis.pdf
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Author(s)
Caputi, Theodore L.
Advisor(s)
Gruber, Jonathan
Finkelstein, Amy
Doyle Jr., Joseph J.
Date Issued
May 2026
Publisher
Massachusetts Institute of Technology
Abstract
This thesis studies patients' health behaviors and access to medical care.
The first chapter studies the effect of retail pharmacy closures on patient health and healthcare utilization. Retail pharmacies are the most frequently visited healthcare provider in the United States. They dispense over 150 billion daily doses of prescription medication to Americans each year and offer an array of basic health services to the public. However, the number of retail pharmacies has declined significantly in recent years, with even more pharmacies scheduled to close in the near future. The surge of recent pharmacy closures has raised significant concern about pharmacy access, though there is little evidence on the effects of pharmacy access. Using a stacked difference-in-difference approach, I find that patients decrease their prescription drug use following their primary pharmacy's closure, but only by 1.5 percent. Instead, patients strongly and rapidly adapt by using mail-order pharmacies and switching from 1-month prescriptions to 3-month prescriptions. There is little evidence that primary pharmacy closure significantly impacts downstream healthcare utilization.
The second chapter, joint with Jonathan Gruber, David H. Howard, and Jetson Leder-Luis, studies the effect of for-profit hospice use on Medicare spending and patient outcomes. The Medicare hospice program is intended to provide palliative care to terminal patients, but patients with long stays in hospice are highly profitable, motivating concerns about overuse among the Alzheimer's and Dementia (ADRD) population in the rapidly growing for-profit sector. We provide the first causal estimates of the effect of for-profit hospice on patient spending using the entry of for-profit hospices over 20 years. We find hospice has saved money for Medicare by offsetting other expensive care among ADRD patients. As a result, policies limiting hospice use including revenue caps and antifraud lawsuits are distortionary and deter potentially cost-saving admissions.
The third chapter investigates the effect of recreational marijuana dispensaries on fatal car crashes. Car crashes are a leading cause of death among younger Americans and have become a central concern in the US marijuana policy debate. I construct a novel dataset of marijuana dispensary openings, which I use to present new evidence on the effect of marijuana on traffic fatalities. My intra-state differences-in-differences approach both increases power relative to past analyses and eliminates the potential of time-varying state-level confounding. I find that marijuana dispensary openings increase the rate of fatal car crashes by approximately 6.3%. I use a series of tests to discern between two plausible mechanisms -- increased traffic and increased impairment -- and ultimately find that the effect is primarily driven by impairment.
JEL Codes: I1 (Health)
MIT Department
Massachusetts Institute of Technology. Department of Economics
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