Hips and Hearts: The Variation in Incentive Effects of Insurance across Hospital Procedures

39 Pages Posted: 12 Jun 2013 Last revised: 25 Jun 2013

See all articles by Denise Doiron

Denise Doiron

University of New South Wales

Denzil G. Fiebig

UNSW Australia Business School, School of Economics

Agne Suziedelyte

City University London

Date Written: May 29, 2013

Abstract

The separate identification of effects due to incentives, selection and preference heterogeneity in insurance markets is the topic of much debate. In this paper, we investigate the presence and variation in moral hazard across health care procedures. The key motivating hypothesis is the expectation of larger causal effects in the case of more discretionary procedures. The empirical approach relies on an extremely rich and extensive dataset constructed by linking survey data to administrative data for hospital medical records. Using this approach we are able to provide credible evidence of large moral hazard effects but for elective surgeries only.

Keywords: health insurance, asymmetric information, moral hazard

JEL Classification: D82, I11, I13

Suggested Citation

Doiron, Denise and Fiebig, Denzil G. and Suziedelyte, Agne, Hips and Hearts: The Variation in Incentive Effects of Insurance across Hospital Procedures (May 29, 2013). UNSW Australian School of Business Research Paper No. 2013-14, Available at SSRN: https://ssrn.com/abstract=2277354 or http://dx.doi.org/10.2139/ssrn.2277354

Denise Doiron (Contact Author)

University of New South Wales ( email )

High Street
Sydney, NSW 2052
Australia
+61 2 9385 3734 (Phone)
+61 2 9313 6337 (Fax)

HOME PAGE: http://economics.web.unsw.edu.au/people/DDOIRON/

Denzil G. Fiebig

UNSW Australia Business School, School of Economics ( email )

High Street
Sydney, NSW 2052
Australia

Agne Suziedelyte

City University London ( email )

Northampton Square
London, EC1V OHB
United Kingdom

HOME PAGE: http://https://sites.google.com/site/agnesuziedelyte/

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