PUBHLTH 122 Lecture 11: 2/8/17 Lecture Notes
9 Mar 2017
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How do we measure it: responsiveness of medical use to price, finish this slide. Rand his: insurance plans: full coverage = 0 copayments and deductible. Because they could get that 5%, they still wanted to file a claim. This way they guaranteed themselves how much medical care they would use. Figure #35: hospital admissions: as the price declines, the use of hospitals are used more. Figure #36: total adjusted expenses: typical demand curve that is sloping downwards which says that when something is cheaper, they will use more. Figure #37: price elasticity: they are all negative because as the price goes up, mc use goes down, dental: (-0. 39) much more discretion, demand for medical care is not very elastic if below 1%. So there is a response but not a strong response: outpatient (-0. 31, hospital (-0. 14) non-discretionary, the more discretionary the care, the higher the elasticity and the more responsive people are to price changes.
