Available online 27 May 2024, 102900

Demand-side cost-sharing reduces moral hazard in healthcare but increases exposure to out-of-pocket expenditure. We introduce a structural microsimulation model to evaluate both total and out-of-pocket expenditure for different cost-sharing schemes. We use a Bayesian mixture model to capture the healthcare expenditure distributions across different age-gender categories. We estimate the model using Dutch data and simulate outcomes for a number of policies. The model suggests that for a deductible of 300 euros shifting the starting point of the deductible away from zero to 400 euros leads to an average 4% reduction in healthcare expenditure and 47% lower out-of-pocket payments.

Moral hazard

Out-of-pocket

Shifted deductible

Co-insurance

Bayesian mixture model

Microsimulation model

© 2024 The Author(s). Published by Elsevier B.V.