The Demand for Episodes of Medical Treatment

Interim Results from the Health Insurance Experiment

by Emmett B. Keeler, John E. Rolph, Naihua Duan, Janet M. Hanley, Willard G. Manning

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This report contains a statistical and economic analysis of data on the demand for medical care from the Health Insurance Experiment (HIE). The report presents methods and interim results for medical care spending data organized by episodes, a powerful and fairly new approach to the study of demand. Chapter 2 describes the data, and Chap. 3 describes the assumptions and procedures used to group claims into episodes. Chapter 4 gives the analysis of the effects of price and other covariates on the cost per episode, and the number of episodes per year. Chapter 5 shows how occurrence rates change over the year. Finally, Chap. 6 discusses the consequences of these results for economic and health services research.

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