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How Much Uncompensated Care do Doctors Provide?

Author

Listed:
  • Jonathan Gruber
  • David Rodriguez

Abstract

The magnitude of provider uncompensated care has become an important public policy issue. Yet existing measures of uncompensated care are flawed because they compare uninsured payments to list prices, not to the prices actually paid by the insured. We address this issue using a novel source of data from a vendor that processes financial data for almost 4000 physicians. We measure uncompensated care as the net amount that physicians lose by lower payments from the uninsured than from the insured. Our best estimate is that physicians provide negative uncompensated care to the uninsured, earning more on uninsured patients than on insured patients with comparable treatments. Even our most conservative estimates suggest that uncompensated care amounts to only 0.8% of revenues, or at most $3.2 billion nationally. These results highlight the important distinction between charges and payments, and point to the need for a re-definition of uncompensated care in the health sector going forward.

Suggested Citation

  • Jonathan Gruber & David Rodriguez, 2007. "How Much Uncompensated Care do Doctors Provide?," NBER Working Papers 13585, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:13585
    Note: HC
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    File URL: http://www.nber.org/papers/w13585.pdf
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    Cited by:

    1. Jonathan Gruber, 2008. "Covering the Uninsured in the United States," Journal of Economic Literature, American Economic Association, vol. 46(3), pages 571-606, September.
    2. Juergen Jung & Chung Tran, 2016. "Market Inefficiency, Insurance Mandate and Welfare: U.S. Health Care Reform 2010," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 20, pages 132-159, April.
    3. Scott E. Harrington, 2010. "The Health Insurance Reform Debate," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 77(1), pages 5-38.
    4. Jonathan Gruber & Helen Levy, 2009. "The Evolution of Medical Spending Risk," Journal of Economic Perspectives, American Economic Association, vol. 23(4), pages 25-48, Fall.
    5. repec:eee:finlet:v:21:y:2017:i:c:p:172-177 is not listed on IDEAS
    6. Xuezheng Qin & Gordon Liu, 2013. "Does the US health care safety net discourage private insurance coverage?," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 14(3), pages 457-469, June.
    7. repec:eee:eecrev:v:100:y:2017:i:c:p:428-462 is not listed on IDEAS
    8. Juergen Jung & Chung Tran, 2016. "Market Inefficiency, Insurance Mandate and Welfare: U.S. Health Care Reform 2010," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 20, pages 132-159, April.
    9. Neale Mahoney, 2012. "Bankruptcy as Implicit Health Insurance," NBER Working Papers 18105, National Bureau of Economic Research, Inc.
    10. Jung, Juergen & Tran, Chung & Chambers, Matthew, 2017. "Aging and health financing in the U.S.: A general equilibrium analysis," European Economic Review, Elsevier, vol. 100(C), pages 428-462.
    11. David Ong & Chun-Lei Yang, 2014. "Pro Bono Work and Trust in Expert Fields," CESifo Working Paper Series 4897, CESifo Group Munich.
    12. Janicki, Hubert P., 2014. "The role of asset testing in public health insurance reform," Journal of Economic Dynamics and Control, Elsevier, vol. 44(C), pages 169-195.

    More about this item

    JEL classification:

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

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