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Does seeing the doctor more often keep you out of the hospital?
Robert Kaestner1, Anthony T Lo Sasso2
1National Bureau of Economic Research, Institute of Government and Public Affairs, University of Illinois, Department of Economics, University of Illinois at Chicago, 815 West Van Buren Street, Suite 525, Chicago, IL 60607, United States.
Insights
Increased outpatient spending, driven by health insurance benefits, led to more hospital admissions, particularly for conditions allowing physician and patient discretion. This suggests a link between accessible outpatient care and inpatient utilization.
Area of Science:
- Health Economics
- Healthcare Utilization
- Health Services Research
Background:
- Understanding the relationship between outpatient and inpatient healthcare spending is crucial for effective healthcare management.
- Health insurance benefit designs can significantly influence patient and provider healthcare utilization decisions.
Purpose of the Study:
- To investigate the causal association between outpatient care spending and inpatient care utilization.
- To quantify the impact of increased outpatient spending on hospital admissions and spending.
Main Methods:
- Leveraging a unique health insurance benefit design to establish causality.
- Analyzing data on outpatient spending, inpatient admissions, and inpatient spending among health plan enrollees.
Main Results:
- A $100 increase in outpatient spending correlated with a 1.9% rise in the probability of inpatient events.
- The same $100 increase in outpatient spending was linked to a 4.6% increase in inpatient spending.
- The rise in hospital admissions was observed for conditions where physician and patient discretion is a factor.
Conclusions:
- Greater outpatient spending can causally lead to increased inpatient utilization.
- The findings highlight the complex interplay between outpatient care, insurance benefits, and inpatient healthcare events.
- Healthcare policy should consider the potential for increased inpatient admissions when designing outpatient benefits.
Abstract:
By exploiting a unique health insurance benefit design, we provide novel evidence on the causal association between outpatient and inpatient care. Our results indicate that greater outpatient spending was associated with more hospital admissions: a $100 increase in outpatient spending was associated with a 1.9% increase in the probability of having an inpatient event and a 4.6% increase in inpatient spending among enrollees in our sample. Moreover, we present evidence that the increase in hospital admissions associated with greater outpatient spending was for conditions in which it is plausible to argue that the physician and patient could exercise discretion.
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