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The Impact of Increased Cost-sharing on Utilization of Low Value Services: Evidence from the State of Oregon

Author

Listed:
  • Jonathan Gruber
  • Johanna Catherine Maclean
  • Bill J. Wright
  • Eric S. Wilkinson
  • Kevin Volpp

Abstract

In this study we examine the impact of a value-based insurance design (V-BID) program implemented between 2010 and 2013 at a large public employer in the state of Oregon. The program substantially increased cost-sharing, specifically copayments and coinsurance, for several healthcare services believed to be of low value and overused (sleep studies, endoscopies, advanced imaging, and surgeries). Using a differences-in-differences design coupled with granular, administrative health insurance claims data, we estimate the change in low value healthcare service utilization among beneficiaries before and after program implementation relative to a comparison group of beneficiaries who were not exposed to the V-BID. Our findings suggest that the V-BID significantly reduced utilization of targeted services. These findings have important implications for both public and private healthcare policies as V-BID principles are rapidly proliferating in healthcare markets.

Suggested Citation

  • Jonathan Gruber & Johanna Catherine Maclean & Bill J. Wright & Eric S. Wilkinson & Kevin Volpp, 2016. "The Impact of Increased Cost-sharing on Utilization of Low Value Services: Evidence from the State of Oregon," NBER Working Papers 22875, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:22875
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    References listed on IDEAS

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    Cited by:

    1. Natalia Serna, 2021. "Cost sharing and the demand for health services in a regulated market," Health Economics, John Wiley & Sons, Ltd., vol. 30(6), pages 1259-1275, June.
    2. Elizabeth D. Brouwer & Anirban Basu & Kai Yeung, 2019. "Adoption of Cost Effectiveness-Driven Value-Based Formularies in Private Health Insurance from 2010 to 2013," PharmacoEconomics, Springer, vol. 37(10), pages 1287-1300, October.

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    More about this item

    JEL classification:

    • I1 - Health, Education, and Welfare - - Health
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private

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