Intertemporal Substitution in Health Care Demand PDF Download

Author: Haizhen Lin
Publisher:
ISBN:
Category : Health insurance
Languages : en
Pages : 44

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Book Description
Abstract: Nonlinear cost-sharing in health insurance encourages intertemporal substitution be- cause patients can reduce their out-of-pocket costs by concentrating spending in years when they hit the deductible. We test for such intertemporal substitution using data from the RAND Health Insurance Experiment, where people were randomly assigned either to a free care plan or to a cost-sharing plan which had coinsurance up to a maximum dollar expenditure (MDE). Hitting the MDE--leading to an effective price of zero--has a bigger effect on monthly health care spending and utilization than does being in free care, because people who hit the MDE face high future and past prices. As a result, we estimate that sensitivity to short-lasting price changes is about twice as large as sensitivity to long-lasting changes. These findings help reconcile conflicting estimates of the price elasticity of demand for health care, and suggest that high deductible health plans may be less effective than hoped in controlling health care spending

Author: Nicolai Kristensen
Publisher:
ISBN:
Category :
Languages : en
Pages : 38

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Book Description
We investigate how, in temporary economic hardship, agents change their consumption of health services, and how this depends on whether the service is universally free-of-charge visits to GP's or privately co-financed dental care. We find that own expenditures for dental care decrease. The decrease is mainly seen in preventive treatment, a durable good, but for the lowest income quartile there is also a substantial decrease in expenditures for curative dental care, although this is a consumption good with very low intertemporal substitution. The expenditures for GPs are unaltered. The findings indicate that consumption of health services critically depends on the existence of user charges versus universal coverage. The welfare loss associated with postponement of preventive care is considerably lower than the welfare loss related to a decrease in the use of curative dental care induced by economic hardship. The policy implication could be public support for means-tested curative dental services.

Author: Amy Finkelstein
Publisher: Columbia University Press
ISBN: 0231538685
Category : Medical
Languages : en
Pages : 161

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Book Description
Addressing the challenge of covering heath care expenses—while minimizing economic risks. Moral hazard—the tendency to change behavior when the cost of that behavior will be borne by others—is a particularly tricky question when considering health care. Kenneth J. Arrow’s seminal 1963 paper on this topic (included in this volume) was one of the first to explore the implication of moral hazard for health care, and Amy Finkelstein—recognized as one of the world’s foremost experts on the topic—here examines this issue in the context of contemporary American health care policy. Drawing on research from both the original RAND Health Insurance Experiment and her own research, including a 2008 Health Insurance Experiment in Oregon, Finkelstein presents compelling evidence that health insurance does indeed affect medical spending and encourages policy solutions that acknowledge and account for this. The volume also features commentaries and insights from other renowned economists, including an introduction by Joseph P. Newhouse that provides context for the discussion, a commentary from Jonathan Gruber that considers provider-side moral hazard, and reflections from Joseph E. Stiglitz and Kenneth J. Arrow. “Reads like a fireside chat among a group of distinguished, articulate health economists.” —Choice

Author: Gilbert R. Ghez
Publisher: Columbia University Press
ISBN:
Category : Business & Economics
Languages : en
Pages : 180

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There is a belief now that family behavior over the life cycle can be analyzed by economic methods. This study deals with allocation of resources by families over time.

Author: Joseph P. Newhouse
Publisher: Harvard University Press
ISBN: 9780674318465
Category : Business & Economics
Languages : en
Pages : 516

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Book Description
In the most important health insurance study ever conducted researchers at the RAND Corporation devised all experiment to address two key questions in health care financing: how much more medical care will people use if it is provided free of charge, and what are the consequences for their health? For three- or five-year periods the experiment measured both use and health outcomes in populations carefully selected to be representative of both urban and rural regions throughout the United States. Participants were enrolled in a range of insurance plans requiring different levels of copayment for medical care, from zero to 95 percent. The researchers found that in plans that reimbursed a higher proportion of the bill, patients used substantially more services - indeed, those who paid nothing used 40 percent more services than those required to pay a high deductible - but the effect on the health of the average person was negligible. In addition, participants who were assigned at random to a well-established health maintenance organization used hospitals substantially less than those in the fee-for-service system, again with no measurable effect on the health of the average person. This book collects in one place for the first time results previously dispersed through many journals over many years. Drawing comprehensive, coherent conclusions from an immense amount of data, it is destined to be a classic work serving as an invaluable reference for all those concerned with health care policy - health service researchers, policymakers in both the public and the private sectors, and students.

Author: National Research Council
Publisher: National Academies Press
ISBN: 0309184975
Category : Medical
Languages : en
Pages : 129

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Book Description
Developing credible short-term and long-term projections of Medicare health care costs is critical for public- and private-sector policy planning, but faces challenges and uncertainties. There is uncertainty not only in the underlying economic and demographic assumptions used in projection models, but also in what a policy modeler assumes about future changes in the health status of the population and the factors affecting health status , the extent and pace of scientific and technological breakthroughs in medical care, the preferences of the population for particular kinds of care, the likelihood that policy makers will alter current law and regulations, and how each of these factors relates to health care costs for the elderly population. Given the substantial growth in the Medicare population and the continued increases in Medicare, Medicaid, and private health insurance spending, the availability of well-specified models and analyses that can provide useful information on the likely cost implications of health care policy alternatives is essential. It is therefore timely to review the capabilities and limitations of extant health care cost models and to identify areas for research that offer the most promise to improve modeling, not only of current U.S. health care programs, but also of policy alternatives that may be considered in the coming years. The National Research Council conducted a public workshop focusing on areas of research needed to improve health care cost projections for the Medicare population, and on the strengths and weaknesses of competing frameworks for projecting health care expenditures for the elderly. The workshop considered major classes of projection and simulation models that are currently used and the underlying data sources and research inputs for these models. It also explored areas in which additional research and data are needed to inform model development and health care policy analysis more broadly. The workshop, summarized in this volume, drew people from a wide variety of disciplines and perspectives, including federal agencies, academia, and nongovernmental organizations.

Author: Michael Grossman
Publisher: Columbia University Press
ISBN: 0231544529
Category : Business & Economics
Languages : en
Pages : 153

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Book Description
A seminal work in health economics first published in 1972, Michael Grossman's The Demand for Health introduced a new theoretical model for determining the health status of the population. His work uniquely synthesized economic and public health knowledge and has catalyzed a vastly influential body of health economics literature. It is well past time to bring this important work back into print. Grossman bases his approach on Gary S. Becker's household production function model and his theory of investment in human capital. Consumers demand health, which can include illness-free days in a given year or life expectancy, and then produce it through the input of medical care services, diet, other market goods and services, and time. Grossman also treats health and knowledge as equal parts of the durable stock of human capital. Consumers therefore have an incentive to invest in health to increase their earnings in the future. From here, Grossman examines complementarities between health capital and other forms of human capital, the most important of which is knowledge capital earned through schooling and its effect on the efficiency of production. He concludes that the rate of return on investing in health by increasing education may exceed the rate of return on investing in health through greater medical care. Higher income may not lead to better health outcomes, as wealth enables the consumption of goods and services with adverse health effects. These are some of the major revelations of Grossman's model, findings that have great relevance as we struggle to understand the links between poverty, education, structural disadvantages, and health.

Author: OECD
Publisher: OECD Publishing
ISBN: 9264279083
Category :
Languages : en
Pages : 258

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Book Description
This report examines how the two global mega-trends of population ageing and rising inequalities have been developing and interacting, both within and across generations.

Author: Robert Shimer
Publisher: Princeton University Press
ISBN: 1400835232
Category : Business & Economics
Languages : en
Pages : 189

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Book Description
Labor Markets and Business Cycles integrates search and matching theory with the neoclassical growth model to better understand labor market outcomes. Robert Shimer shows analytically and quantitatively that rigid wages are important for explaining the volatile behavior of the unemployment rate in business cycles. The book focuses on the labor wedge that arises when the marginal rate of substitution between consumption and leisure does not equal the marginal product of labor. According to competitive models of the labor market, the labor wedge should be constant and equal to the labor income tax rate. But in U.S. data, the wedge is strongly countercyclical, making it seem as if recessions are periods when workers are dissuaded from working and firms are dissuaded from hiring because of an increase in the labor income tax rate. When job searches are time consuming and wages are flexible, search frictions--the cost of a job search--act like labor adjustment costs, further exacerbating inconsistencies between the competitive model and data. The book shows that wage rigidities can reconcile the search model with the data, providing a quantitatively more accurate depiction of labor markets, consumption, and investment dynamics. Developing detailed search and matching models, Labor Markets and Business Cycles will be the main reference for those interested in the intersection of labor market dynamics and business cycle research.

Author: Orley Ashenfelter
Publisher:
ISBN:
Category : Automobile driving
Languages : en
Pages : 12

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Book Description
In this paper we show that omitted variables and publication bias lead to severely biased estimates of the value of a statistical life. Although our empirical results are obtained in the context of a study of choices about road safety, we suspect that the same issues plague the estimation of monetary trade-offs regarding safety in other contexts.