Natalia Serna (Stanford University)

Biography: Natalia Serna, PhD, is an Assistant Professor of Health Policy at Stanford University. Her research studies how insurer and provider competition shapes health plan design and patient health outcomes, using tools from industrial organization and causal inference. One strand of her work examines provider network design, insurer-provider contracting, and the government regulation of insurers; a second explores how competition affects patient outcomes like mortality, fertility, and breast cancer screening.

Segmentation in Pharmaceutical Markets: Evidence from Contraceptives

Abstract: Pharmaceutical markets are often divided between over-the-counter (OTC) and health insurance segments. This paper shows that segmentation of this kind dampens pharmaceutical demand by softening product competition and raising prices relative to a pooled market, an effect amplified by information frictions about drug quality. Our setting is the hormonal contraceptive market in Colombia, where a price ceiling policy generates variation that allows us to separately identify price sensitivity, preferences for quality, and information frictions. Using a structural model, we find that when product variety is held fixed, moving to an OTC-only market would raise contraceptive demand by 8% and reduce fertility by 0.7 births per woman. However, when manufacturers eliminate redundant products, moving to an OTC-only market would reduce demand by 2% and raise fertility by 0.2 births per woman.  Effects are qualitatively similar when moving to an insurance-only market.