Cover: The Effect of Cost Sharing on the Use of Medical Services by Children

The Effect of Cost Sharing on the Use of Medical Services by Children

Interim Results from a Randomized Controlled Trial

Published in: Pediatrics, v. 75, no. 5, May 1985, p. 942-951

Posted on on January 01, 1985

by Arleen Leibowitz, Willard G. Manning, Emmett B. Keeler, Naihua Duan, Kathleen N. Lohr, Joseph P. Newhouse

Health care expenditures of 1,136 children whose families participated in a randomized trial, The Rand Health Insurance Experiment, are reported. Children whose families were assigned to receive 100% reimbursement for health costs spent one third more per capita than children whose families paid 95% of medical expenses up to a family maximum. Outpatient use decreased as cost-sharing rose for a variety of use measures: the probability of seeing a doctor, annual expenditures, number of visits per year, and numbers of outpatient treatment episodes. Hospital expenditures did not vary significantly among children insured with varying levels of cost-sharing. Episodes of treatment for preventive care were as responsive to cost-sharing as episodes for acute or chronic illness. The results give no reason not to insure preventive care as liberally as care for acute illness.

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