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The effect of managed care on use of health care services: results from two contemporaneous household surveys

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  • Partha Deb
  • Chenghui Li
  • Pravin K. Trivedi
  • David M. Zimmer

Abstract

This paper estimates treatment effects of managed care plans on the utilization of health care services using data from two contemporaneous, nationally representative household surveys from the USA. The paper exploits recent advances in simulation‐based econometrics to take the endogeneity of enrollment into managed care plans into account and identify the causal relationship between managed care enrollment and utilization. Overall, results from the two surveys are remarkably similar, lending credibility to their external validity and to the econometric model and estimation methods. There is significant evidence of self‐selection into managed care plans. After accounting for selection, an individual enrolled in an health maintenance organization (HMO) plan has 2 more visits to a doctor and has 0.1 more visits to the emergency room per year than would the same individual enrolled in a nonmanaged care plan. Copyright © 2006 John Wiley & Sons, Ltd.

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  • Partha Deb & Chenghui Li & Pravin K. Trivedi & David M. Zimmer, 2006. "The effect of managed care on use of health care services: results from two contemporaneous household surveys," Health Economics, John Wiley & Sons, Ltd., vol. 15(7), pages 743-760, July.
    • Handle: RePEc:wly:hlthec:v:15:y:2006:i:7:p:743-760
    DOI: 10.1002/hec.1096
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    Cited by:

    1. Andrew M. Jones, 2007. "Identification of treatment effects in Health Economics," Health Economics, John Wiley & Sons, Ltd., vol. 16(11), pages 1127-1131.
    2. Jeon, Boyoung & Kwon, Soonman, 2013. "Effect of private health insurance on health care utilization in a universal public insurance system: A case of South Korea," Health Policy, Elsevier, vol. 113(1), pages 69-76.
    3. Nyman, John A. & Koc, Cagatay & Dowd, Bryan E. & McCreedy, Ellen & Trenz, Helen Markelova, 2018. "Decomposition of moral hazard," Journal of Health Economics, Elsevier, vol. 57(C), pages 168-178.
    4. Yan Zheng & Tomislav Vukina & Xiaoyong Zheng, 2021. "Risk aversion, moral hazard, and gender differences in health care utilization," The Geneva Risk and Insurance Review, Palgrave Macmillan;International Association for the Study of Insurance Economics (The Geneva Association), vol. 46(1), pages 35-60, March.
    5. Hung-Hao Chang & Junlin He & Kannika Saeliw, 2017. "The Role of Off-Farm Labor Participation Decisions of Married Farm Couples on Farm Direct Marketing in Taiwan," The Developing Economies, Institute of Developing Economies, vol. 55(1), pages 3-22, March.
    6. Chantal Grandchamp & Lucien Gardiol, 2011. "Does a mandatory telemedicine call prior to visiting a physician reduce costs or simply attract good risks?," Health Economics, John Wiley & Sons, Ltd., vol. 20(10), pages 1257-1267, October.
    7. Kent Eliasson & Robert Nakosteen & Olle Westerlund & Michael Zimmer, 2014. "All in the family: Self-selection and migration by couples," Papers in Regional Science, Wiley Blackwell, vol. 93(1), pages 101-124, March.
    8. Chantal Grandchamp & Lucien Gardiol, 2008. "Does a mandatory telemedicine call prior to visiting a physician reduce costs or simply attract good risks?," Working Papers 0801, University of Lausanne, Institute of Health Economics and Management (IEMS).
    9. Randall P. Ellis & Shenyi Jiang & Tzu-Chun Kuo, 2013. "Does service-level spending show evidence of selection across health plan types?," Applied Economics, Taylor & Francis Journals, vol. 45(13), pages 1701-1712, May.
    10. Chang, Hung-Hao, 2014. "Food Preparation for the School Lunch Program and Body Weight of Elementary School Children in Taiwan," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 17(1), pages 1-16, February.
    11. Denzil Fiebig & Elizabeth Savage & Rosalie Viney, 2006. "Does the reason for buying health insurance influence behaviour? CHERE Working Paper 2006/1," Working Papers 2006/1, CHERE, University of Technology, Sydney.
    12. Dan Shane; & Pravin Trivedi;, 2012. "What Drives Differences in Health Care Demand? The Role of Health Insurance and Selection Bias," Health, Econometrics and Data Group (HEDG) Working Papers 12/09, HEDG, c/o Department of Economics, University of York.
    13. Richard Dusansky & Çağatay Koç, 2010. "Implications of the Interaction Between Insurance Choice and Medical Care Demand," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 77(1), pages 129-144, March.
    14. Kjaer, Trine & Gyrd-Hansen, Dorte, 2008. "Preference heterogeneity and choice of cardiac rehabilitation program: Results from a discrete choice experiment," Health Policy, Elsevier, vol. 85(1), pages 124-132, January.
    15. Adam Wagstaff, 2010. "Estimating health insurance impacts under unobserved heterogeneity: the case of Vietnam's health care fund for the poor," Health Economics, John Wiley & Sons, Ltd., vol. 19(2), pages 189-208, February.
    16. Andrew M. Jones, 2007. "Identification of treatment effects in Health Economics," Health Economics, John Wiley & Sons, Ltd., vol. 16(11), pages 1127-1131, November.

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