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Does a mandatory telemedicine call prior to visiting a physician reduce costs or simply attract good risks?

Chantal Grandchamp and Lucien Gardiol ()

No 801, Working Papers from University of Lausanne, Institute of Health Economics and Management (IEMS)

Abstract: This paper aims to estimate empirically the efficiency of a Swiss telemedicine service introduced in 2003. We used claims' data gathered by a major Swiss health insurer, over a period of six years and involving 160 000 insured adults. In Switzerland, health insurance is mandatory, but everyone has the option of choosing between a managed care plan and a fee-for-service plan. The present paper focuses on a conventional fee-for-service plan including a mandatory access to a telemedicine service; the insured are obliged to phone this medical call centre prior to visiting a physician. This type of plan generates much lower average health expenditures than a conventional insurance plan. Reasons for this may include selection, incentive effects or simply efficiency. In our sample, about 90% of the difference in health expenditure can be explained by selection and incentive effects. The remaining 10% of savings due to the efficiency of the telemedicine service amount to about SFr 150 per year per insured, of which approx. 60% is saved by the insurer and 40% by the insured. While the plan is cost-effective, the big winners are the insured who not only save monetary and non-monetary costs, but also benefit from reduced premiums.

Keywords: health; insurance; selection; efficiency; telemedicine (search for similar items in EconPapers)
JEL-codes: I11 D12 C21 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-hea and nep-ias
Date: 2008-03
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Related works:
Journal Article: Does a mandatory telemedicine call prior to visiting a physician reduce costs or simply attract good risks? (2011)
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