Price and income elasticities for medical care services by Joseph P. Newhouse

Cover of: Price and income elasticities for medical care services | Joseph P. Newhouse

Published by Rand in Santa Monica, Ca .

Written in English

Read online

Places:

  • United States,
  • United States.

Subjects:

  • Medical care -- United States -- Mathematical models.,
  • Medical care -- Utilization -- United States.,
  • Medical care, Cost of -- United States.

Edition Notes

Bibliography: p. 31-32.

Book details

StatementJoseph P. Newhouse, Charles E. Phelps.
Series[Report] - Rand Corporation ; R-1197-NC/OEO
ContributionsPhelps, Charles E., joint author.
Classifications
LC ClassificationsAS36 .R3 R-1197, RA410.53 .R3 R-1197
The Physical Object
Paginationix, 32 p. ;
Number of Pages32
ID Numbers
Open LibraryOL5241731M
LC Control Number75313169

Download Price and income elasticities for medical care services

Price elasticities of demand for hospital, physician office and hospital outpatient services are found to be small, all lying below 02 in absolute value. Wage income elasticities are positive and non-wage income is found to have no effect on demand, both as hypothesized by the by: Price elasticities of demand for hospital, physician office and hospital outpatient services are found to be small, all lying below 02 in absolute value.

New Estimates of Price and Income Elasticities of Medical Care Services Joseph P. Newhouse, Charles E. Phelps. Chapter in NBER book The Role of Health Insurance in the Health Services Sector (), Richard N.

Rosett (p. - ) Published in by NBERCited by: Title: Price and Income Elasticities for Medical Care Services Author: Joseph P. Newhouse Subject: Presents a theory of the demand for medical care services that is a generalization of Michael Grossman's investment model in three ways: Medical care is not treated as a homogeneous commodity but disaggregated to hospital and physician services.

Price. Add to Cart. Paperback 41 pages. $ $ 20% Web Discount. Presents a theory of the demand for medical care services that is a generalization of Michael Grossman's investment model in three ways: Medical care is not treated as a homogeneous commodity but disaggregated to hospital and physician services; the price of the provider selected and medical insurance are treated as Cited by: Price and Income Elasticities of Medical Care elasticities, presented at the end of the paper, are invariant to this ance rate ti disaggregation.

equations. Stanford Libraries' official online search tool for books, media, journals, databases, government documents and : Newhouse, Joseph P. 1 Health care demand elasticities by type of service Randall P. Ellis 1, Bruno Martins, and Wenjia Zhu2 1Boston University, Department of Economics 2Harvard Medical School, Department of Health Care Policy [email protected] (corresponding author), [email protected], [email protected] insurance or constrain the growth in health care expenditures.

The price and income elasticities measured in the RAND Health Insurance Experiment (HIE) of the s remain a widely used source of elasticity estimates with respect to the demand for covered health care services.

However, these estimates may fail to support today’s. Joseph P. Newhouse & Charles E. Phelps, "New Estimates of Price and Income Elasticities of Medical Care Services," NBER Chapters, in: The Role of Health Insurance in the Health Services Sector, pagesNational Bureau of Economic Research, Inc.

Handle: RePEc:nbr:nberch demand for medical services;economics of health care;price theory: First presented to the public: 6/1/ Original Publication Date: 6/ Previously Published By: Rand Corp.

License Grantor / Date Granted: Charles Phelps / (View License) Date Deposited: Date Last Updated. Estimates of these responses—measured as price and income elasticities—are often the basis for proposals to expand access or curb spending.

Existing estimates are more than 30 years old and do not factor in recent Price and income elasticities for medical care services book for prescription drugs or mental health services, or current health care.

Additional Physical Format: Online version: Newhouse, Joseph P. Price and income elasticities for medical care services. Santa Monica, Calif.: Rand,   To date, international analyses on the strength of the relationship between country-level per capita income and per capita health expenditures have predominantly used developed countries’ data.

This study expands this work using a panel data set for countries for the – period. We found that health care has an income elasticity that qualifies it as a necessity good, which is Cited by: We estimate within-year price elasticities of demand for detailed health care services using an instrumental variable strategy, in which individual monthly cost shares are instrumented by employer-year-plan-month average cost shares.

Using million person-months spanning 73 employers fromFile Size: 1MB. Journal of Health Economics 7 () North-Holland HEALTH STATUS AND THE DEMAND FOR HEALTH Results on Price Elasticities Gerard J.

WEDIG* Health Economics Research Inc., and Boston University, Boston, MAUSA Received Mayfinal version received October The relationship between measured health status and the elasticity of demand for ambulatory physician services Cited by: We estimate within-year price elasticities of demand for detailed health care services using an instrumental variable strategy, in which individual monthly cost shares are instrumented by employer-year-plan-month average cost by: 2Harvard Medical School, Department of Health Care Policy [email protected] (corresponding author), [email protected], [email protected] J Abstract We estimate within-year price elasticities of demand for detailed health care services using an instrumental variable strategy, in which individual monthly cost shares are instrumented byFile Size: 1MB.

Even the demand for long-term care insurance is found to be inelastic, with price and income elasticities of about andrespectively (Kumar et al., ). However, these studies generally assume the individual is able to make marginal changes in the insurance policy.

This paper revisits the classic issue of price elasticities of demand for health care services, a topic of central importance for understanding moral hazard and optimal insurance plan design, as well as having important implications for health plan choice, access to care, health care cost containment, risk adjustment, and financial Size: 1MB.

This means that for low-income individuals, the price elasticity for the number of visits explains a higher percentage of the price elasticity of total expenditure than it does for high-income individuals.

This evidence shows that low-income individuals forgo medical care more often than do high-income individuals. AgeCited by: Newhouse JP. Medical-Care Expenditure: A Cross-National Survey.

Journal of Human Resources. Winter; 12 (1)– Newhouse J, Phelps C. Price and Income Elasticities for Medical Care Services. In: Perlman M, editor. The Economics of Health and Medical Care Cited by: 7.

The paper has used the US aggregate time-series data, toto estimate the demand and supply relationship of physician services, similar to the model specified in the Martin Feldstein article, 1 under a disequilibrium physician services market assumption.

The maximum likelihood method is used for the empirical by: 3. The income elasticities are higher at the low-income level and lower at the higher income level. In the well-developed countries, when consumers have the free access to health care services, the changes of their income do not have a significant effect on their ability to pay for such services.

The Elasticity of Demand for Health Care A Review of the Literature and Its Application to the Military Health System those medical services with larger price elasticities. for DoD health. Estimates of income elasticity range from 0 to about ; meaning that researchers do not know if medical services are elastic or inelastic with respect to income.

A paper by Borger et al. () reviews of the findings of previous research regarding price and income elasticities of medical care. We estimate within-year price elasticities of demand for detailed health care services using an instrumental variable strategy, in which individual monthly cost shares are instrumented by employer-year-plan-month average cost shares.

A specification using backward myopic prices gives more plausible and stable results than using forward myopic prices. Using million person-months. Such studies estimating elasticities of demand for healthcare services and that of health insurance are only very few (12).

Elasticity can themselves vary with income. For example, a good that is a necessity for the rich can be a luxury for the poor. Yet another study with OECD countries showed income elasticities are higher at low-income. We have solutions for your book.

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An working paper by Amanda Kowalski claims that medical care and prices have an elastic relationship. “My main results show that the price elasticity of expenditure on medical care is across the to quantiles of the expenditure distribution, with a point-wise 95% confidence interval at the quantile of to rs can use price elasticities to simulate the effects of changing prices An income elasticity of for all medical products implies that consumption will be higher among low-income groups than among high-income groups.

New estimates of elasticity of demand for healthcare in rural China is due to the joint effect of income and medical price, we care is elastic is an empirical question [8]. In the US, results about elasticity of demand for health care are well­ Size: KB.

Our results are important in the context of the luxury good hypothesis, as they suggest that income elasticities for public healthcare services are close to zero – the implied lottery income elasticities for private healthcare suggest that healthcare is a normal good (see Table 1).

We find an elasticity of only for cervical examinations. The Income Elasticity of Demand for Health Insurance 3 1. Introduction In the United States, health care expenditure as a share of GDP has greatly increased over the last 50 years. Inhealth care spending was only % of GDP; but by it had risen to % of GDP.

Similar trends have been seen in other developed countries. In France, theFile Size: 1MB. Su Liu Deborah Chollet; Price and Income Elasticity of the Demand for Health Insurance and Health Care Services: A Critical Review of the Literature Final Report Ma Submitted by: Mathematica Policy Research, Inc.

Maryland Ave. S.W., Suite Washington, DC. The Medical Device Excise Tax: Economic Analysis Congressional Research Service 1 Introduction The medical device tax was one of a number of additional revenues proposed to offset the cost of the Affordable Care Act (ACA; P.L. ).1 This excise tax is projected to collect $38 billion of excise tax revenue over the next 10 years.

Using unique individual-level data compiled from administrative records from the Chilean private health insurance market, I estimate the price elasticity of expenditures across a variety of health care services.

I find elasticities that range between zero for the most acute service (appendectomy) and − for the most elective (psychologist. Understanding Transport Demands and Elasticities How Prices and Other Factors Affect Travel Behavior 18 March Todd Litman Victoria Transport Policy Institute Abstract Transport demand refers to the amount and type of travel that people would choose under specific conditions.

This report describes concepts related to transport demand. Both the price and quantity of health care demanded have risen dramatically in recent decades, raising health care spending from 5% of GDP in to 16% in Rapidly rising costs and unequal access are known as the twin problems of health care.

Factors that might increase the marginal efficiency of investment in health capital are better medical services, a better environment (less pollution), and better medical knowledge. Deductibles encourage people to take care of themselves, because they know that if they have to see a doctor there will be some expense involved.

The Demand for Medical Care Elasticity What do you expect the own-price elasticity for medical services to be?

What factors affect this? Generally demand for medical care tends to be inelastic 1. Insurance 2. Few substitutes 3. Portion of budget allocated to good 4.

Necessity good 5. Time spent making purchase decision (emergency care less price sensitive) / The Demand for Medical Care.Q2 states “The demand for medical services is price inelastic ” From my notes on your Chapter 3 lecture (and I get that a general rule cannot apply to all scenarios, goods or services) demand is price elastic if a 1% change in price leads to more than 1% change in quantity demanded and price inelastic if a 1% change in price leads to less.Rising Health Care Expenditures: A Demand-Side Analysis Thus any increase in the price of medical services not only can be passed on to consumers, but also results in an these innovations have caused both an increase in the price of and expen-ditures on medical care (Newhouse,p.

7). The main reason for this.

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