title: Health Insurance, Health Savings Accounts and Healthcare Utilization.
abstract: Assuming symmetric information, we show that a high-deductible health plan (HDHP) combined with a tax-favored health savings account (HSA) induces more savings and less treatment compared with a full coverage plan under reasonable risk preferences. Furthermore, a higher tax subsidy increases savings in any case but decreases medical utilization if and only if treatment expenses are above the deductible. A larger deductible increases savings but does not necessarily decrease healthcare utilization. Whether an HDHP/HSA combination is preferred over a full coverage contract depends on absolute risk aversion. A higher tax advantage increases the attractiveness of an HDHP/HSA combination, whereas the effects of changes in the deductible are ambiguous. The paper shows that a potential regulator needs to carefully set the size of the deductible as only in a certain corridor of the probability of sickness, its effect on aggregate healthcare costs are unambiguously favorable.
authors.affiliation: Institute for Risk Management and Insurance, Ludwig-Maximilians-Universität, München, Germany.
authors.forename: Richard
authors.initials: R
authors.lastname: Peter
authors.affiliation: Institute for Risk Management and Insurance, Ludwig-Maximilians-Universität, München, Germany.
authors.forename: Sebastian
authors.initials: S
authors.lastname: Soika
authors.affiliation: School of Risk Management, Insurance and Actuarial Science, St. John's University, New York, NY, USA.
authors.forename: Petra
authors.initials: P
authors.lastname: Steinorth
mesh_terms: D003669:Deductibles and Coinsurance / Q000706:statistics & numerical data; D006801:Humans; D007348:Insurance, Health / Q000706:statistics & numerical data*; D020402:Medical Savings Accounts / Q000331:legislation & jurisprudence* / Q000706:statistics & numerical data*; D017059:Models, Econometric; D010342:Patient Acceptance of Health Care / Q000706:statistics & numerical data*; D013660:Taxes
keywords: consumer driven health care; health insurance; health risk; health savings accounts; healthcare utilization; high-deductible health plans; medical savings