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Cost sharing and the demand for health services in a regulated market

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  • Natalia Serna

Abstract

This paper measures consumer responsiveness to cost sharing in healthcare using a regression discontinuity design. I use a novel and detailed claims‐level dataset from the Colombian healthcare market, where the government exogenously determines a tier system for coinsurance rates and copays based on the enrollee's monthly income. I find that patients exposed to higher coinsurance rates demand fewer services relative to patients facing lower cost sharing. This reduction holds for both discretionary and preventive services. Lower utilization translates into lower costs, despite evidence that patients facing higher prices do not substitute away from more expensive providers.

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  • Natalia Serna, 2021. "Cost sharing and the demand for health services in a regulated market," Health Economics, John Wiley & Sons, Ltd., vol. 30(6), pages 1259-1275, June.
    • Handle: RePEc:wly:hlthec:v:30:y:2021:i:6:p:1259-1275
    DOI: 10.1002/hec.4244
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    Cited by:

    1. Vanessa Cirulli & Giuliano Resce & Marco Ventura, 2021. "Co-payment exemption and healthcare consumption. Quasi-experimental evidence from Italy," Working Papers in Public Economics 203, University of Rome La Sapienza, Department of Economics and Law.

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