This paper explores how a diagnosis of hypertension might affect a person's health‐related behaviors. The analysis uses a two‐dimensional regression discontinuity design because hypertension is diagnosed when a person's systolic or diastolic blood pressure (SBP or DBP) surpasses a pre‐established threshold. We find that those closely above the SBP threshold significantly adjusted their lifestyle, such as reducing daily fat intake and quitting smoking, while those just surpassing the DBP cutoff did not. Further mechanism analysis suggests that the possibility of constraints, rather than education and income gradients, does more to explain the disparate behaviors of subjects near the SBP and DBP thresholds. Those around the DBP threshold generally have tighter work schedules and undertake more competitive jobs, which hinder them from improving their lifestyle. Overall, our findings complement the existing literature by posing a new perspective for understanding people's potential reluctance to adjust their behavior.
We examine the efficiency-based arguments for second-best optimal health insurance with multiple treatment goods and multiple time periods. Correlated shocks across health care goods and over time interact with complementarity and substitutability to affect optimal cost sharing. Health care goods that are substitutes or have positively correlated demand shocks should have lower optimal patient cost sharing. Positive serial correlations of demand shocks and uncompensated losses that are positively correlated with covered health services also reduce optimal cost sharing. Our results rationalize covering pharmaceuticals and outpatient spending more fully than is implied by static, one good, or one period models.
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