Impact of the Change in Payments on the Actual and Perceived Behaviors of Medical Care Providers

Abstract

Prior literature established the link between a person aging out of a parent's insurance coverage at age nineteen and a significant decrease in insurance coverage of those nineteen-year-old young adults. This paper furthers this line of research by establishing a statically significant change in the payment burden of the various sources that comprise the total payment received by the medical care providers treating young adults who have aged out of their parent's insurance. The empirical method used is the regression discontinuity framework. The impact of the change in the providers' payment sources on the providers' behavior (supply-side) and the patients' perception of the providers' behavior (demand-side) is examined using a 14-year sample of unmarried young adults from the Medical Expenditure Panel Survey. This research finds that although there is a statistically significant change in the sources of the total payments received by medical care providers, they do not change their actual treatment decisions. However, the patients do perceive a statistically significant adverse change in the behavior of their medical care providers.