New Healthcare Economics Data Have Been Reported by Investigators at RAND (The moral hazard effects of consumer responses to targeted cost-sharing)

Health & Medicine Week

By a News Reporter-Staff News Editor at Health & Medicine Week -- A new study on Health and Medicine - Healthcare Economics is now available. According to news originating from Santa Monica, California, by NewsRx correspondents, research stated, "This paper examines the effects of the reference pricing program implemented by the California Public Employees Retirement System (CalPERS) in 2012. The program uses targeted cost-sharing to incentivize patient price shopping."

Our news journalists obtained a quote from the research from RAND, "We find that the program leads to a 10.3% increase in the use of low-price providers and reduces the average cost per procedure by 12.5%. We further estimate that the program reduces medical spending by $218.8 per procedure, which we estimate is approximately 53.7% of the excessive spending that is due to patient choice of higher price providers caused by insurance coverage, at the expense of a $94.3 (or 12.5%) reduction in consumer surplus."

According to the news editors, the research concluded: "The cost savings from the reference pricing program is about two to three times as large as the reduction from implementing a high-deductible health plan, while the accompanying consumer surplus reduction is much smaller under reference pricing."

For more information on this research see: The moral hazard effects of consumer responses to targeted cost-sharing. Journal of Health Economics, 2017;56():201-221. 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/)

The news correspondents report that additional information may be obtained from C.M. Whaley, RAND Corp., Santa Monica, CA 90406, United States. Additional authors for this research include C.R. Guo and T.T. Brown (see also Health and Medicine - Healthcare Economics).

The direct object identifier (DOI) for that additional information is: https://doi.org/10.1016/j.jhealeco.2017.09.012. 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: Santa Monica, California, United States, North and Central America, Healthcare Economics, Health and Medicine, Business, RAND.