Cost Sharing in Health Insurance — A Reexamination

Abstract

Concern that the terms of some health insurance policies encourage overuse of medical care has led to the argument that an important element of cost containment is cost consciousness on the consumer's part. Comprehensive health care reform in the United States now appears very unlikely. Nevertheless, there is still a high degree of interest in making consumers more cost conscious.1 Two approaches are often proposed. The first is to increase the level of cost sharing specified in insurance policies by raising copayments or coinsurance rates and to make cost sharing a part of every policy. The second is to require . . .

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