Cost-sharing design matters: A comparison of the rebate and deductible in healthcare

Since 2006, the Dutch population has faced two different cost-sharing schemes in health insurance for curative care: a mandatory rebate in 2006 and 2007, and a mandatory deductible since 2008. With administrative data for the entire Dutch population and using a difference-in-differences design, we compare the effect of these schemes on healthcare consumption. We draw upon a regression discontinuity design to extrapolate effects to the cut-off age 18 and incorporate the size of the cost-sharing scheme. Our estimate shows that for individuals around the age of eighteen, one euro of the deductible reduces healthcare expenditures 18 eurocents more than one euro of the rebate. This demonstrates that different designs of a cost-sharing scheme can have substantially different effects on total healthcare expenditure.

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