Screening and preventable illness.
If an agent does not discount the future at a constant rate, as in some forms of myopia, her optimal strategy is unattainable without some commitment device. We apply this familiar idea to a model of screening and disease prevention, and explore how financial incentives can correct suboptimal health choices. In general, myopia need not imply under-screening. While the optimal intervention for prevention effort is a state-invariant subsidy, the optimal intervention for screening may involve a tax or a subsidy. When screening and prevention are coincident, a simple and practical subsidy equal to one minus the discount factor to both screening and intervention is indicated.
Byrne
M M
MM
Department of Veterans Affairs Medical Center, Health Services Research and Development Center of Excellence, Houston, TX 77030, USA. mbyrne@bcm.tmc.edu
Thompson
P
P
D017281:Cost of Illness; D003657:Decision Making; D017048:Health Care Costs; D006801:Humans; D017059:Models, Econometric; D009216:Myopia / Q000175:diagnosis* / Q000191:economics / Q000517:prevention & control; D010358:Patient Participation / Q000191:economics* / Q000706:statistics & numerical data; D011336:Probability; D011788:Quality of Life; D012052:Reimbursement, Incentive; D026712:Value of Life / Q000191:economics*; D015351:Vision Screening / Q000191:economics* / Q000706:statistics & numerical data