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Can a Deductible Kill? The Effect of Patient Cost-Sharing on Health

Author

Listed:
  • Ayyagari, Padmaja

    (University of South Florida)

  • Salm, Martin

    (Tilburg University)

  • Sargent, Eric

    (Tilburg University)

Abstract

We study how health insurance deductibles affect healthcare spending and health using a regression discontinuity design and administrative data from the Netherlands. Exploiting an annual deductible reset, we compare patients admitted to the emergency room just before and after January 1. Patients admitted after the reset face zero marginal prices for care and incur 14\% higher annual healthcare costs. Despite substantially higher utilization, we find no effect on mortality or other health outcomes across income and health-risk groups. These results suggest that modest deductibles reduce healthcare spending without adverse health consequences.

Suggested Citation

  • Ayyagari, Padmaja & Salm, Martin & Sargent, Eric, 2026. "Can a Deductible Kill? The Effect of Patient Cost-Sharing on Health," IZA Discussion Papers 18420, IZA Network @ LISER.
    • Handle: RePEc:iza:izadps:dp18420
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    Keywords

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    JEL classification:

    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private
    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis

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