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Do Optional Deductibles Reduce the Number of Doctor Visits? Empirical Evidence with German Data

SOEPpapers 141, 22 S.

Hendrik Schmitz


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Deductibles in health insurance are often regarded as a means to contain health care costs when individuals exhibit moral hazard. However, in the absence of moral hazard, voluntarily chosen deductibles may instead lead to self-selection into different insurance contracts. We use a set of new variables in the German Socioeconomic Panel for the years 2002, 2004, and 2006 that measure individual health more accurately and include risk-attitudes towards health in order to determine the price elasticity of demand for health care. A latent class approach that takes into account the panel structure of the data reveals that the effect of deductibles on the number of doctor visits is negligible. Private add-on insurance increases the number of doctor visits. However, altogether the effects of the insurance state on the demand for doctor visits are small in magnitude.

Topics: Health

JEL-Classification: I11;I18;G22
Keywords: Health insurance, deductibles, add-on insurance, count data, latent class panel model
Frei zugängliche Version: (econstor)