• Literature related to the RAND Health Insurance Experiment

    Well, that’s a bold title! I’m not really going to list all academic literature pertaining to the RAND HIE (RAND maintains a very comprehensive list). However, in preparation for a 45-minute talk I’m going to give to students in public policy (not necessarily health) on the experiment, its strengths, limitations, and policy implications, I’m going to read and reread some important paper that relate to it. Below I list four, selected somewhat haphazardly and for reasons explained below (see italicized text associated with each paper in the reference section below).

    Knowledgeable readers, if you are aware of other papers I should consider, please share. Keep in mind, however, that my goal is to inform students about the essential details of the RAND HIE and why it is important. There are many nuances I will have to put aside. If the students remember anything, it will be only the big ideas.

    Also, if anyone out there has given a talk on the RAND HIE, whether part of a course or otherwise, and wishes to share some slides or notes (privately or for mention on the blog), feel free.

    Some Papers of Relevance

    Manning, Willard G., Joseph P. Newhouse, Naihua Duan, Emmett B. Keeler, and Arleen Leibowitz. 1987. “Health Insurance and the Demand for Medical Care: Evidence from a Randomized Experiment.” American Economic Review, 77(3): 251–77.  One of the earliest papers on the HIE.

    Newhouse, Joseph. 1993. Free for All: Lessons from the RAND Health Insurance Experiment. Cambridge, MA: Harvard University Press. A book.

    Patient Cost-Sharing, Hospitalization Offsets, and the Design of Optimal Health Insurance for the Elderly, Amitabh Chandra, Jonathan Gruber, Robin McKnight. I just happened to read this recently. It is an NBER working paper version of a recent AER publication by the same authors. It has a nice literature review on the effect of co-payments on utilization. The paper itself studies a population not included in the RAND HIE, the elderly.

    Katherine Baicker and Amitabh Chandra, “Myths and misconceptions about U.S. health insurance” Health Affairs, 2008. I described this paper yesterday. I also read this recently, not necessarily looking for stuff on the HIE. It briefly summarizes the findings of the RAND HIE and its implications.

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    • If the policy students are econometrically-inclined, you may want to mention the discussion of the HIE in “Mostly Harmless Econometrics”. Angrist and Pischke seem to take aim on page 99-100 at the HIE’s estimates for the effect of insurance on utilization “conditional on seeking treatment”. The authors don’t seem very keen on “conditional on positive” estimates like these. I can’t say I totally understood their argument, but maybe you can enlighten your students (and/or blog readers)

      • @Aaron – Oh, you’re good! I had forgotten about the discussion in MHE and I know that MHE, or portions thereof, is being assigned in this class. Yours is the first comment I’ve ever printed out (to put on my stack relating to this talk). Thanks!