Findings on Healthcare Economics Reported by Investigators at University of Iowa (Endogenous information, adverse selection, and prevention:…

Findings on Healthcare Economics Reported by Investigators at University of Iowa (Endogenous information, adverse selection, and prevention: Implications for genetic testing policy)

By a News Reporter-Staff News Editor at Health & Medicine Week -- Current study results on Health and Medicine - Healthcare Economics have been published. According to news reporting out of Iowa City, Iowa, by NewsRx editors, research stated, "We examine public policy toward the use of genetic information by insurers. Individuals engage in unobservable primary prevention and have access to different prevention technologies."

Financial support for this research came from Nevada Insurance Education Foundation (see also Health and Medicine - Healthcare Economics).

Our news journalists obtained a quote from the research from the University of Iowa, "Thus, insurance markets are affected by moral hazard and adverse selection. Individuals can choose to take a genetic test to acquire information about their prevention technology. Information has positive decision-making value, that is, individuals may adjust their behavior based on the result of the test. However, testing also exposes individuals to uncertainty over the available insurance contract, so-called classification risk, which lowers the value of information. In our analysis we distinguish between four different policy regimes, determine the value of information under each regime and associated equilibrium outcomes on the insurance market."

According to the news editors, the research concluded: "We show that the policy regimes can be Pareto ranked, with a duty to disclose being the preferred regime and an information ban the least preferred one."

For more information on this research see: Endogenous information, adverse selection, and prevention: Implications for genetic testing policy. Journal of Health Economics, 2017;55():95-107. Journal of Health Economics can be contacted at: Elsevier Science Bv, PO Box 211, 1000 Ae Amsterdam, Netherlands. (Elsevier - www.elsevier.com; Journal of Health Economics - www.journals.elsevier.com/journal-of-health-economics/)

Our news journalists report that additional information may be obtained by contacting R. Peter, University of Iowa, Dept. of Finance, Iowa City, IA 52242, United States. Additional authors for this research include A. Richter and P. Thistle.

The direct object identifier (DOI) for that additional information is: https://doi.org/10.1016/j.jhealeco.2017.06.010. This DOI is a link to an online electronic document that is either free or for purchase, and can be your direct source for a journal article and its citation.

Keywords for this news article include: Iowa City, Iowa, United States, North and Central America, Healthcare Economics, Health and Medicine, University of Iowa.

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