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Medicare balance billing restrictions: Impacts on physicians and beneficiaries

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  • McKnight, Robin

Abstract

Recent publicity about “concierge physicians” has raised concerns about the potential adverse effects of allowing physicians to bill their patients for fees that are above normal copayments and insurance reimbursements. In particular, consumers who are unable to afford the additional costs of such physicians are concerned that their access to highquality medical care could be compromised. Such concerns in the context of Medicare led states and the federal government, beginning in the late 1980s, to restrict the ability of physicians to “balance bill” beneficiaries for charges in excess of the copayment and reimbursement amounts approved by Medicare. In this paper, I provide empirical evidence that this policy change resulted in an 8% reduction in out-of-pocket medical expenditures by elderly households. In spite of the change in marginal reimbursement to physicians, however, I find little evidence that the restrictions affected quantity or quality of care.
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Suggested Citation

  • McKnight, Robin, 2007. "Medicare balance billing restrictions: Impacts on physicians and beneficiaries," Journal of Health Economics, Elsevier, vol. 26(2), pages 326-341, March.
  • Handle: RePEc:eee:jhecon:v:26:y:2007:i:2:p:326-341
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    References listed on IDEAS

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    1. Yelowitz, Aaron S., 2000. "Public policy and health insurance choices of the elderly: evidence from the medicare buy-in program," Journal of Public Economics, Elsevier, vol. 78(3), pages 301-324, November.
    2. Mitchell, Janet B. & Cromwell, Jerry, 1982. "Physician behavior under the medicare assignment option," Journal of Health Economics, Elsevier, vol. 1(3), pages 245-264, December.
    3. Glazer, Jacob & Glazer, Jacob & McGuire, Thomas G., 1993. "Should physicians be permitted to 'balance bill' patients?," Journal of Health Economics, Elsevier, vol. 12(3), pages 239-258, October.
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    Cited by:

    1. Hugh Gravelle & Anthony Scott & Peter Sivey & Jongsay Yong, 2016. "Competition, prices and quality in the market for physician consultations," Journal of Industrial Economics, Wiley Blackwell, vol. 64(1), pages 135-169, March.
    2. Dormont, B. & Péron, M., 2015. "Does health insurance encourage the rise in medical prices?," Health, Econometrics and Data Group (HEDG) Working Papers 15/16, HEDG, c/o Department of Economics, University of York.
    3. Lecluyse, Ann & Van de Voorde, Carine & De Graeve, Diana & Schokkaert, Erik & Van Ourti, Tom, 2009. "Hospital supplements in Belgium: Price variation and regulation," Health Policy, Elsevier, vol. 92(2-3), pages 276-287, October.
    4. Mathias Kifmann & Florian Scheuer, 2011. "Balance billing: the patients' perspective," Health Economics Review, Springer, vol. 1(1), pages 1-14, December.
    5. Christopher Brunt & Gail Jensen, 2010. "Medicare Part B reimbursement and the perceived quality of physician care," International Journal of Health Economics and Management, Springer, vol. 10(2), pages 149-170, June.
    6. Brigitte Dormont & Mathilde Péron, 2015. "Does health insurance encourage the rise in medical prices? A test on balance billing in France," Post-Print hal-01518404, HAL.
    7. repec:dau:papers:123456789/15235 is not listed on IDEAS
    8. Hiroyuki Kawaguchi, 2012. "Unique mixtures of public and private funding in Japan - The ban on billing for mixed medical care service -," Public Policy Review, Policy Research Institute, Ministry of Finance Japan, vol. 8(2), pages 145-170, July.

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    JEL classification:

    • I1 - Health, Education, and Welfare - - Health

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