How Does Price Matter in Healthcare Stated-Choice Surveys?
- Presenter:
Chair: Peter Zweifel; Discussant: Mark Pauly Mon June 5, 2006 13:45-15:15 Room 213
A literature review of published stated choice (SC) studies related to health care indicates that all published studies estimate willingness to pay (WTP) by dividing the estimated utility difference between an intervention or outcome and a reference condition by the marginal utility of income (MUY). However, estimates of the marginal utility of income are only valid if subjects accept price levels as income-constrained, out- of-pocket expenses of obtaining the indicated outcome and if MUY is approximately constant over the relevant range of prices. There currently is little empirical evidence on how SC subjects evaluate price information when health care is partly or fully insured. SC subjects may ignore prices altogether in evaluating tradeoffs, discount prices because they are accustomed to paying only a fraction of actual prices, or recode price levels to categories such as low, medium, and high that ignore actual differences in price levels. Recoding may be a symptom of simplifying a less important attrib?????here patients currently pay for certain healthcare-related services out of their own pocket, and “cheap talk” strategies that alert subjects to common response errors in SC surveys.
