Monday, October 19, 2015

Schooling economists

Kevin Drum and Charles Gaba look at a lot of confusing numbers and conclude that Obamacare is chugging along satisfactorily, enrolling more and more people who might otherwise be uninsured.

Meanwhile, Sarah Kliff reports that developments in one of the program's many byways are not having the expected results.

Kliff explains: health economists
have long theorized that higher deductibles would force down health-care costs.

The idea was that higher deductibles would make patients become smarter shoppers: If they had to pay more of the cost, they'd likely choose something closer to the $1,529 appendectomy than the $186,955 appendectomy (yes, some hospitals really do charge that much). This would push the really expensive doctors to lower their prices so cheaper physicians didn't steal their business.
But it turns out, people don't treat getting sick as an occasion for comparison shopping. They want access to a medical system that will heal them and they go where they know. If high deductibles make access expensive, they delay and go later -- probably sicker and probably eventually needing more expensive care. Under high deductible insurance plans
workers just went to the doctor way less.
Illness simply isn't an occasion for consumer diligence. We don't work that way.

I find it hard to imagine anyone who was not an ivory tower economist would ever have thought otherwise.

1 comment:

Hattie said...

Thanks for this. You are really hard-hitting lately, and I wish I had time for more extended comments.

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