Volume 21, Number 3 (Summer) 1986
Ellis, Randall P., and Thomas G. McQuire. 1986. "Cost Sharing and Patterns of Mental Health Care Utilization." Journal of Human Resources 21(3):359-380.
Deductibles and coverage ceilings are common features of health insurance. This paper proposes and tests a new method for estimating the impact of these health coverage features on demand when total demand during a particular period is not known with certainty at the beginning of the period. We use expected end-of-year price as a proxy for the notion of "effective price" first suggested by Keeler et al. (1982) in a two-stage estimation procedure. Applying the method to the demand for ambulatory mental health care in the presence of a $500 coverage ceiling yields estimated demand responses similar to those obtained by other researchers.
Ellis is an assistant professor of economics at Boston University and senior economist at the Health Data Institute. McGuire is an associate professor of economics at Boston University and a senior economist at the Health Data Institute. The research for the paper was supported by the Health Data Institute, Inc., grant no. 1-RO1-MH37293 from the National Institute of Mental Health, and a grant from the Pew Charitable Trust. They would like to thank Alan Fairbank for competent programming assistance for this paper.
© 2003 by the Board of Regents of the University of Wisconsin System
US ISSN 0022-166X