What was really being studied, albeit unintentionally, was health care outcomes in a free plan vs. health care outcomes in a high-cost plan which you could leave to go back to your original insurance if it got too expensive in the high-cost plan. There is missing data on the health care outcomes for those who left the high-cost plan. There is an excellent reason to suspect the missing data doesn’t have the same probability distribution as the data that is present for the high-cost plan people, namely, why would it get too expensive to remain in the plan if there wasn’t some adverse health outcome occurring? And why wouldn’t it often get too expensive to remain in the plan if some really serious adverse health outcome was occurring?

This is a classic missing data problem in statistics, but unfortunately most of the foundational work in missing data hadn’t been done at the time of the RAND study, so they may well have not realized their results were going to be biased by not following up on all the dropouts. We wouldn’t do it that way today.

This suggestion of a cause-effect relationship created from a statistical phenomenon, while factually based, is problematic at best. There are several other potential causes that may have created the effect of dropping out of the study. It is hard to imagine all of the determinants in a study some 3 decades ago in quite a different healthcare environment, but at least two seem plausible. First, the nature of the cognitive decision process that lies at the heart of the cost-sharing incentive. When the individual is at home or work and begins to think about seeing a healthcare provider for a symptomatic or asymptomatic perceived problem, they are encouraged by the incentive to balance the cost with the need. An issue with the method used in co-insurance incentives is the uncertainty of the amount of the payment required as it is a percentage of the cost of treatment. This uncertainty creates anxiety in the individual. Some individuals tolerate anxiety better than others. It is possible that some portion of the 179 individuals did not wish to continue with this anxiety even though the real money involved was negligible as the subjects in the study were virtually made whole by the payments made to them for being included in the study. Second, the state of the reimbursement process was complicated by the addition of a co-insurance calculation and payment process not just for the subject, but for the provider; in fact, both were burdened additionally by the process that was unfamiliar to them and must have seemed cumbersome at the time. It would be easy to extrapolate that some part of the 179 subjects that dropped out did not appreciate the extra bureaucracy created by the paperwork and did not see that it was worth being in the study since they would not benefit enough to put up with it.

Would Occam find that the subjects were all ill as the most likely cause of dropping out? Perhaps the psychological distress theory is more likely. Was there an adverse selection in reverse that was caused by illness in the 179 subjects? Nyman proposes a logical argument based on a statistical fact, but is that enough to discount the Health Insurance Experiment?

(1) Catastrophic case management, disease management, physician practice profiling, 24/7 nurse telephone triage, and other elements of managed care are included not just in HMO plans but also in most PPO plans and in some of the high-deductible consumer-directed health plans.

(2) Most HMO plans now have patient copayments – with varying copayments for specialists versus primary care physicians, prescription pharmacy benefit, and so forth.

(3) I recall that a further analysis of the RAND study that appeared in Medical Care did demonstrate that low-income and chronically ill patents did have less utilization of appropriate care under high cost sharing.

The consumer directed health plan-HSA advocates need current data to bolster their claims.

I have not seen a single comparison of a high deductible health plan with an HSA to an HMO (as would happen in a large employer providing their employees a choice among those two options). All of the comparisons that have been shown to me are high deductible health plans with HSAs compared to PPOs. My employer has over 85% enrollment in HMO plans (the rest are in PPO plans). A high deductible health plan with a Medical Savings Account was offered for three years several years ago and less than 1% of employees opted for that choice.

Until I see current data, I am skeptical.