Patient Cost-Sharing and Hospitalization Offsets in the Elderly
AbstractIn the Medicare program, increases in cost sharing by a supplemental insurer can exert financial externalities. We study a policy change that raised patient cost sharing for the supplemental insurer for retired public employees in California. We find that physician visits and prescription drug usage have elasticities that are similar to those of the RAND Health Insurance Experiment (HIE). Unlike the HIE, however, we find substantial â€œoffsetâ€ effects in terms of increased hospital utilization. The savings from increased cost sharing accrue mostly to the supplemental insurer, while the costs of increased hospitalization accrue mostly to Medicare.
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Bibliographic InfoPaper provided by Harvard Kennedy School of Government in its series Scholarly Articles with number 8058412.
Date of creation: 2009
Date of revision:
Publication status: Published in American Economic Review
Other versions of this item:
- Amitabh Chandra & Jonathan Gruber & Robin McKnight, 2010. "Patient Cost-Sharing and Hospitalization Offsets in the Elderly," American Economic Review, American Economic Association, American Economic Association, vol. 100(1), pages 193-213, March.
- G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
- I12 - Health, Education, and Welfare - - Health - - - Health Production
- I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
- J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
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