Episode 47: Bonus Episode, Conversation with Craig Garthwaite, Associate Professor of Strategy at the Kellogg School of Management
by Chuck Feerick07-04-2018
In this week’s special bonus episode, we had the honor of speaking with Professor Craig Garthwaite, Associate Professor of Strategy and the Director of Healthcare at Kellogg. Professor Garthwaite is an applied microeconomist whose research examines the effects of government policies and social phenomena with a focus on the health and biopharmaceutical sectors. His recent work has focused on the private sector effects of the Affordable Care Act, including the labor supply effects of large insurance expansions, the changes in uncompensated hospital care resulting from public insurance expansions, and the responses of non-profit hospitals to financial shocks. In prior work, he has examined the impact of government cash assistance programs on health and the effect of changes in expected mortality from the emergence of crack-cocaine markets on educational attainment. Professor Garthwaite has testified before the United States House of Representatives and several state legislatures on matters related to the minimum wage and health care reforms.
Professor Garthwaite also studies questions of pricing and innovation in the biopharmaceutical sector. In this area, he has examined the effect of expanded patent protection on pricing in the Indian pharmaceutical market, the innovation response of United States pharmaceutical firms to increases in demand, and the relationship between health insurance expansions and high drug prices.
His research has appeared in journals such as the Quarterly Journal of Economics, the American Economic Review, the Review of Economics and Statistics and Health Affairs, and you have likely seen his work and interviews in the Wall Street Journal, the Washington Post, and Vox. He has also appeared as a guest on various television and radio shows such as Nightly Business Report and NPR Marketplace. In 2015, Professor Garthwaite was named one of Poet and Quants 40 Best under 40 Business School Professors.
A few of the topics that Chuck and Professor Garthwaite cover in the episode include:
- Professor Garthwaite’s background and how he arrived at his position at Kellogg
- The causes behind why we are seeing a recent trend in vertical integration among players in the healthcare space
- The incentive alignments between mergers such as CVS and Aetna and what the lay consumer might not understand about the benefits of such a merger
- Professor Garthwaite’s thoughts around what can be done about the high drug prices in the US
- Professor Garthwaite’s perspective on the Amazon- Berkshire-JPMorgan health venture and ideas around what these 3 companies aiming to achieve together
- Many point to misaligned physician incentives or the increase in diabetes or people not leading healthy lifestyles, that lead to the high healthcare costs in the US but Professor Garthwaite shares other factors to consider in this debate as well
- The tradeoff between innovation and access to care and how Professor Garthwaite defines innovation
- The type of “disruption in healthcare” Professor Garthwaite thinks truly has merit and will have impact
- Professor Garthwaite’s current research on Hospitals as Insurers of Last Resort and how hospitals may not be passing along all uncompensated-care costs to other parties such as hospital employees or privately insured patients
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