Does health insurance encourage the rise in medical prices?

Brigitte Dormont and Péron, M.

Health, Econometrics and Data Group (HEDG) Working Papers from HEDG, c/o Department of Economics, University of York

Abstract: Our purpose is to evaluate the influence of health insurance coverage on the use of specialists who balance bill. We estimate the impact on patients' behavior of a shock consisting of better coverage of balance billing, while controlling for supply side drivers. We use a panel data set of 43,111 French individuals observed between January 2010 and December 2012. Individuals are observed when they are all covered by the same supplementary insurer, with no coverage for balance billing, and after 3,819 of them switched to other supplementary insurers which offer better coverage. Our estimations show that better coverage contributes to a rise in medical prices by increasing the demand for specialists who balance bill: for individuals who enjoy better coverage the proportion of consultations of specialists who balance bill is increased by 9%, and balance billing charged per consultation by 32%. However, the impact of the coverage shock depends on local supply side organization. When the proportion of specialists who do not balance bill their patients is high enough, patients have a real choice between specialist type: there is neither evidence of an inflationary effect of supplementary coverage, nor of limits in access to care due to balance billing.

Keywords: health insurance; balance billing; health care access (search for similar items in EconPapers)
JEL-codes: C23 I13 I18 (search for similar items in EconPapers)
Date: 2015-09
New Economics Papers: this item is included in nep-hea and nep-ias
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