A welfare measure of offset effects in health insurance

• 成果类型: Article
• 署名作者: Glazer, Jacob; McGuire, Thomas G.
• 署名单位: Harvard University; Tel Aviv University; Boston University
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/j.jpubeco.2012.02.007
• 发表日期: 2012
• 页码: 520-523
• 关键词: Health insurance design; Offset effects

摘要

Changing health insurance coverage for one service may affect use of other insured services. When improving coverage for one service reduces use of another, the savings are referred to as offset effects. For example, costs of better coverage for prescription drugs may be partly offset by reductions in hospital costs. Offset effects have welfare implications but it has not been clear how to value these impacts in design of health insurance. We show that plan-paid - rather than total - spending is the right welfare measure of the offset effect, and go on to develop a sufficient statistic for evaluating the welfare effects of change in coverage in the presence of multiple goods. We derive a simple rule for when a coverage improvement increases welfare due to offset effects. (C) 2012 Elsevier B.V. All rights reserved.