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.

This report is part of the RAND Corporation Report series. The report was a product of the RAND Corporation from 1948 to 1993 that represented the principal publication documenting and transmitting RAND's major research findings and final research.

The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.