Reimbursing Preventive Care

The paper focuses on secondary prevention, such as diagnostic screening, medical examinations and checks-up, which refers to the early detection of disease. Secondary prevention is analyzed as a self-insurance activity reducing the negative shock of illness and can be either complement or substitute...

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Bibliographic Details
Published inIDEAS Working Paper Series from RePEc
Main Author Barigozzi, F
Format Paper
LanguageEnglish
Published St. Louis Federal Reserve Bank of St. Louis 01.01.2001
Subjects
Prevention
Reimbursement
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Summary:The paper focuses on secondary prevention, such as diagnostic screening, medical examinations and checks-up, which refers to the early detection of disease. Secondary prevention is analyzed as a self-insurance activity reducing the negative shock of illness and can be either complement or substitute to illness treatment. This paper analyses the optimal reimbursement scheme for both prevention and treatment when each activity receives either a linear subsidy (i.e. cost sharing) or tax. Although optimal reimbursement systematically encourages treatment, it positively affects prevention if and only if prevention reduces the cost of treatment, that is in the case the two activities are substitutes. The Geneva Papers on Risk and Insurance Theory (2004) 29, 165-186. doi:10.1023/B:GEPA.0000046568.15758.12(This abstract was borrowed from another version of this item.)