Does full insurance increase the demand for health care?

Stefan Boes and Michael Gerfin

Diskussionsschriften from Universitaet Bern, Departement Volkswirtschaft

Abstract: We estimate the causal effect of having full health insurance on health care expenditures. We take advantage of a unique quasi-experimental setup in which deductibles and co- payments were zero in a managed care plan, and non-zero in regular insurance, until a policy change forced all individuals with an active plan to cover a minimum amount of their expenses. Using panel data and a non-linear difference-in-differences strategy, we find a demand elasticity of about -0.14 comparing full insurance with the cost-sharing model, and a significant upward shift in the likelihood to generate costs.

Keywords: Deductibles; health cost; quasi experiment; changes-in-changes (search for similar items in EconPapers)
JEL-codes: C14 I11 (search for similar items in EconPapers)
Date: 2013-10
New Economics Papers: this item is included in nep-hea and nep-ias
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Working Paper: Does Full Insurance Increase the Demand for Health Care? (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:ube:dpvwib:dp1305

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