The Rand Health Insurance Experiment (RHIE) was one of the largest, randomly controlled economic experiments ever conducted. It was designed to test the effect of alternative health insurance policies on the demand for health care and on the health status of a large and closely watched group of people from all walks of life.
Partial findings of the RHIE:
- The greater the portion of their health care bill that individuals are required to pay, the less health care they choose to purchase. Duh. But, what is surprising is how much the difference is - the fully insured purchased roughly 40 percent more health care than those who had to pay their own bills.
- Did this mean that those fully (freely) insured were 40% more healthy? NO! The researchers summarized their findings: "Our results show that the 40 percent increase in services on the free-care plan had little or no effect on health status for the average adult."
- The effects on children showed a somehwat similar pattern. Children under the cost-sharing plans consumed up to one-third less care. However, the reduction in care was not significantly related to health status measures.
