IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

Simulating Health Expenditures Under Alternative Insurance Plans

  • Joan L. Buchanan

    (The RAND Corporation, 1700 Main Street, Santa Monica, California 90406)

  • Emmett B. Keeler

    (RAND Graduate School and The RAND Corporation, 1700 Main Street, Santa Monica, California 90406)

  • John E. Rolph

    (The RAND Corporation, 1700 Main Street, Santa Monica, California 90406)

  • Martin R. Holmer

    (Fannie Mae)

Registered author(s):

    A simulation model that estimates individual health care spending as a function of the structure of indemnity-type insurance plans is presented. The behavioral models that form the basis for this work were developed as part of RAND's Health Insurance Experiment, (HIE), a randomized clinical trial. The randomized design and statistical methods provided estimates of the effects of insurance on use, uncontaminated by sickness or selection effects. The demand for medical care was modelled using episodes of treatment. Within the simulation, episodes occur independently and randomly through time according to a Poisson process with rates depending on individual characteristics and insurance. Empirical results from the HIE indicate that insurance primarily affects individual decisions to seek treatment (episode frequency), but has only minimal effects on episode costs. The response to changes in price (insurance) is modelled as a Bernoulli censoring process on episode frequency. The model is used to address issues on the effective design of insurance plans.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL: http://dx.doi.org/10.1287/mnsc.37.9.1067
    Download Restriction: no

    Article provided by INFORMS in its journal Management Science.

    Volume (Year): 37 (1991)
    Issue (Month): 9 (September)
    Pages: 1067-1090

    as
    in new window

    Handle: RePEc:inm:ormnsc:v:37:y:1991:i:9:p:1067-1090
    Contact details of provider: Postal: 7240 Parkway Drive, Suite 300, Hanover, MD 21076 USA
    Phone: +1-443-757-3500
    Fax: 443-757-3515
    Web page: http://www.informs.org/Email:


    More information through EDIRC

    No references listed on IDEAS
    You can help add them by filling out this form.

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:inm:ormnsc:v:37:y:1991:i:9:p:1067-1090. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mirko Janc)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.