Abstract
Empirical evidence suggests that people are fairly sensitive to cost sharing arrangements in ambulatory mental healthcare. However, pure cost sharing effects are typically hard to measure due to the presence of adverse selection effects. In this paper, we examine the impact of cost sharing on mental healthcare utilization in the context of mandatory health insurance where adverse selection is absent. Using a large proprietary dataset of a Dutch private health insurer, we examine to what extent a new copayment scheme for adult mental healthcare changed healthcare utilization. We exploit the fact that non-adults are exempted from copayments. First, we compare changes in utilization among adults and non-adults using t tests and a difference-in-difference analysis. Second, we highlight differential changes in mental healthcare utilization by treatment (duration and type of mental illness) and individual characteristics (gender and socioeconomic status). Third, we evaluate to what extent anticipatory behavior occurred pending the introduction and subsequent repeal of the new copayment scheme. Our results show a strong and significant (p < 0.01) decrease in outpatient secondary mental healthcare utilization among adults following the introduction of copayments, which is absent among non-adults. This decrease is concentrated among treatments for less severe mental illnesses. Furthermore, the utilization patterns suggest the presence of anticipatory behavior.
Highlights
The effects of cost sharing seem strong for mental healthcare
We examine the impact of cost sharing on mental healthcare utilization in the context of mandatory health insurance where adverse selection is absent
Our results show a strong and significant (p \ 0.01) decrease in outpatient secondary mental healthcare utilization among adults following the introduction of copayments, which is absent among nonadults
Summary
The effects of cost sharing seem strong for mental healthcare. Frank and McGuire [1] show that ‘most the available evidence, experimental or observational, points in the direction of greater price response for ambulatory [outpatient] mental health than other healthcare services’ (p. 911). This paper aims to investigate the pure copayment effects (i.e., without adverse selection effects) for outpatient mental healthcare in a non-US context where adverse selection does not play a role due to both mandatory health insurance and mandatory copayments. This is especially relevant as the benefits of copayments within Europe are increasingly being questioned by both scholars (e.g., [5]) and policy-makers [6]
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