http://www.latimes.com/business/hiltzik/la-fi-mh-overuse-healthcare-20140528-column.html
Do people really overuse healthcare when it's free?
"...Let's start with the raw numbers. There's no evidence that countries that provide free or low-cost healthcare to their citizens, even those who provided it to all their citizens, end up spending more. Quite the contrary."
"...It does appear to be true that families in consumer-directed plans do cut back on healthcare services, at least at first. The question, however, is which services they reduce, and whether their choices are wise. A 2012 study by the Rand Corp. put this question at the forefront. It found that families on high-deductible plans cut spending in part by skipping such important preventive treatments as "childhood vaccinations...mammography, cervical cancer screening, and colorectal cancer screening" as well as "blood tests for glucose and cholesterol for diabetics."
If patients "skimp on highly valuable services that can prevent more costly problems later, the savings may be short-lived," Rand concluded.
Similar findings come from studies compiled by Aaron Carroll, professor of pediatrics at Indiana University. One examined asthma treatment among low-income families, and showed that "families with higher levels of cost-sharing were significantly more likely to delay or avoid going to the office or emergency room for their child's asthma," Carroll reports. "They were more likely to avoid care."
Another study found that even modest increases in co-pay and other cost-sharing among Medicarepatients saw increases in the number and length of hospitalizations, especially among patients with chronic conditions. The reason was obvious: These patients deferred or skipped tests and treatments to save money, resulting ultimately in more severe episodes of their illnesses. Carroll's conclusion: "Cost-sharing is bad for those who need care the most."
As he points out, skin-in-the-game systems don't have to be blunt instruments; in some countries where they're the rule, patients with chronic or severe conditions are exempted. But you rarely hear that option being explored by consumer-directed healthcare advocates in the U.S.
What's most dismaying about simple-mindedly applying market economics to healthcare -- as Levitt has done -- is the failure to recognize the complexity of healthcare. The fact is that drivers of significant cost in the system are those that are least susceptible to the dollars-and-cents family budgeting that might respond to skin-in-the-game rules. It's one thing to skip a visit to the doctor for a mild ankle sprain -- that's not the sort of thing that adds much to U.S. spending, even in the aggregate.
But there's little evidence that decisions on cardiac or cancer care are affected by cost-sharing -- or if it is, whether it leads to the right decisions in the long term. As a British reader of Noah Smith's blogcommented: "I have never woken up and thought: 'It's free, let's have some chemotherapy.'"
