Open AccessDo the uninsured demand less care? Evidence from Maryland’s hospitals
Author(s) -
Amanda Cook
Publication year - 2020
Publication title -
international journal of health economics and management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.544
H-Index - 8
eISSN - 2199-9023
pISSN - 2199-9031
DOI - 10.1007/s10754-020-09280-4
Subject(s) - debt , health insurance , health care , actuarial science , business , bad debt , set (abstract data type) , public economics , finance , economics , economic growth , computer science , programming language
Uninsured individuals receive fewer healthcare services for at least three reasons: responsibility for the entire bill, higher prices, and potential provider reductions for concern of nonpayment. I isolate reductions when uninsured patients are solely financially responsible by capitalizing on Maryland's highly regulated health care system. Prices are set by the state, are uniform across all patients, and hospitals are compensated for free care and bad debt. I use a unique feature of the data, multiple readmissions for patients who gain or lose insurance between visits, to isolate the reductions in quantity demanded when individuals are faced with paying the full price without an insurance contribution. A Blinder-Oaxaca decomposition estimates uninsured individuals receive 6% fewer services after accounting for differences in patient, illness, and hospital characteristics than when these same individuals are insured.