Unbiased Analysis of Today's Healthcare Issues

How does having health insurance affect the probability children recieve needed care

Written By: Jason Shafrin - Sep• 03•08

A recent Robert Wood Johnson Report (see also press release) finds that uninsured children receive less needed medical care than individuals with health insurance.  The report finds that 91% of children who are insured have had a physician visit in the last year compared to only 69% of uninsured children.  Seventy seven percent of children with insurance had a well-child visit in the last year compared to 45% of uninsured children.

Does this mean that having health insurance increases the quantity of health care children receive?  Yes.  Holding health insurance decreases the marginal cost of a physician visit and this increases the probability a child will visit the doctor.

Do these statistics imply that giving health insurance to the uninsured will increase well-child visits to rates of insured children?  Likely no.  Children who have insurance are likely to be different than those without health insurance.  Those with private insurance are likely more educated, richer, and more likely to have an English-speaking household than those without health insurance.  These individuals have likely have higher demand for medical care than the average person.  Thus, giving all uninsured children insurance will likely increase well-child visit rates, but will not increase them to the level of the currently insured.  Conversely, if all insured people lost their insurance, well child visit rates would still be above individuals who are currently uninsured.

While health insurance coverage likely contributes to physician visit rates, it is not the only factor which determines a child’s frequency of physician visits.

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  1. […] consumers about what they should care about with respect to management of their health.” The Healthcare Economist’s Jason Shafrin writes that although providing health insurance to uninsured children would […]

  2. Eddie says:

    Interesting post, but I have a question. You state that “[those with private insurance] likely have higher demand for medical care than the average person.” What is the basis for this assumption? I would assume that those without private insurance (either the uninsured or those on Medicaid) would have greater demand for medical care because they may avoid preventive care or even avoid obtaining needed care.

  3. Jason Shafrin says:

    Let us assume there are two people, Sick Sam and Health Harry. Sick Sam has an 80% chance of falling sick in the next year and Healthy Harry has a 20% chance of falling ill. If Sam and Harry have the same income and face the same price for health insurance, than it is much more likely that Sam will purchase health insurance. Thus, the individuals who buy health insurance will generally have a higher demand for medical care.

    You do make a good point, however, of the dynamic effects. People without health insurance may forego preventive care to save money and thus may need more care in the long run. On the other hand, if you did not have health insurance, you may be more willing to buy preventive care since you know that if you become sick, you–and not your insurance company–will have to foot the bill.