EARL - A. Atwood
Econ Active Research Lunch - Lunch @ 11:30, Presentation @ 12 in UH850
Presenter: Alicia Atwood
The Impact of High Deductible Health Insurance Plans on Spending and Enrollee Behavioral Response
High deductible health plans (HDHPs) are health insurance plans with a deductible of at least $1300 and have become commonplace in the employer insurance market. I assess if HDHPs reduce ex post moral hazard. I examine what happens when an HDHP is added as an option into an individual’s offer set. First, I answer: Do HDHPs lower total medical spending, and is there a behavioral response or simply a shifting of costs to the individual? I find that HDHPs lower spending and reduce utilization as predicted by demand theory. Second, I answer: Where are the savings coming from? I do this by decomposing spending into place of service and service type. I find that the majority of savings are realized through a reduction in hospital based medical care. Contrary to recently published papers I find evidence of price shopping and discriminatory cut backs in service utilization.