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Price and Income Elasticity of the Demand for Health Insurance and Health Care Services

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  • Su Liu
  • Deborah Chollet
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    Abstract

    Resolving the national debate on health care affordability is likely to involve determining how consumer demand for health insurance and health care responds to changes in price or income. Estimates of these responses—measured as price and income elasticities—are often the basis for proposals to expand access or curb spending. Existing estimates are more than 30 years old and do not factor in recent demand for prescription drugs or mental health services, or current health care plan designs. This literature review examines the existing estimates, identifying gaps in them as well as in the methods used for estimating demand.

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    File URL: http://mathematica-mpr.com/publications/pdfs/priceincome.pdf
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    Bibliographic Info

    Paper provided by Mathematica Policy Research in its series Mathematica Policy Research Reports with number 5058.

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    Length: 103
    Date of creation: 24 Mar 2006
    Date of revision:
    Handle: RePEc:mpr:mprres:5058

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    Related research

    Keywords: Health Insurance Coverage; Price and Income Elasticity;

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    References

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    1. Royalty, Anne Beeson, 2000. "Tax preferences for fringe benefits and workers' eligibility for employer health insurance," Journal of Public Economics, Elsevier, vol. 75(2), pages 209-227, February.
    2. Lara D. Shore-Sheppard, 2005. "Stemming the Tide? The Effect of Expanding Medicaid Eligibility on Health Insurance," Department of Economics Working Papers 2005-06, Department of Economics, Williams College.
    3. Royalty, Anne Beeson & Hagens, John, 2005. "The effect of premiums on the decision to participate in health insurance and other fringe benefits offered by the employer: evidence from a real-world experiment," Journal of Health Economics, Elsevier, vol. 24(1), pages 95-112, January.
    4. Marquis, M. Susan & Louis, Thomas A., 2002. "On using sample selection methods in estimating the price elasticity of firms' demand for insurance," Journal of Health Economics, Elsevier, vol. 21(1), pages 137-145, January.
    5. Lo Sasso, Anthony T. & Buchmueller, Thomas C., 2004. "The effect of the state children's health insurance program on health insurance coverage," Journal of Health Economics, Elsevier, vol. 23(5), pages 1059-1082, September.
    6. Gruber, Jonathan & Washington, Ebonya, 2005. "Subsidies to employee health insurance premiums and the health insurance market," Journal of Health Economics, Elsevier, vol. 24(2), pages 253-276, March.
    7. Davina C. Ling & Ernst R. Berndt & Margaret K. Kyle, 2002. "Deregulating Direct-to-Consumer Marketing of Prescription Drugs: Effects on Prescription and Over-the-Counter Product Sales," Journal of Law and Economics, University of Chicago Press, vol. 45(S2), pages 691-723.
    8. Shore-Sheppard, Lara & Buchmueller, Thomas C. & Jensen, Gail A., 2000. "Medicaid and crowding out of private insurance: a re-examination using firm level data," Journal of Health Economics, Elsevier, vol. 19(1), pages 61-91, January.
    9. Strombom, Bruce A. & Buchmueller, Thomas C. & Feldstein, Paul J., 2002. "Switching costs, price sensitivity and health plan choice," Journal of Health Economics, Elsevier, vol. 21(1), pages 89-116, January.
    10. Anne Beeson Royalty & Neil Solomon, 1999. "Health Plan Choice: Price Elasticities in a Managed Competition Setting," Journal of Human Resources, University of Wisconsin Press, vol. 34(1), pages 1-41.
    11. James Marton, 2007. "The impact of the introduction of premiums into a SCHIP program," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 26(2), pages 237-255.
    12. Long, Stephen H. & Marquis, M. Susan & Rodgers, Jack, 1998. "Do people shift their use of health services over time to take advantage of insurance?," Journal of Health Economics, Elsevier, vol. 17(1), pages 105-115, January.
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    Cited by:
    1. Perronnin, Marc, 2013. "Effet de l'assurance complémentaire santé sur les consommations médicales, entre risque moral et amélioration de l'accès aux soins," Economics Thesis from University Paris Dauphine, Paris Dauphine University, number 123456789/13659 edited by Wittwer, Jérôme, September.

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