Economic tradeoff between purchase of medical care and other commodities in the USA.

摘要

In the area of medication use decision making, little research using an economic framework is available to understand what kind of tradeoffs people make when deciding whether to purchase medication as well as the nature of economic constraints and choices that influence the trade-off process. The objective of the study is to understand how people allocate their budget between different groups of goods they use for daily living, given the assumption that the allocation helps them to achieve maximum utility or satisfaction. Another purpose is to understand how people belong to different socioeconomic groups respond to the change in price of different commodities.;Our study analyzed out-of-pocket expenditure from Consumer Expenditure Survey along with Consumer Price Index from 1996 until 2005 to understand how the demand was influenced by change in price of commodities and consumers' income. The sample size of 89,945 consumer units represented the households belonging to non-institutional, civilian U.S. population. Multiple OLS regressions analysis and Tobit regressions were used as statistical tools for analysis.;Major finding includes with the increase in own price, compensated demand decreased. Food, housing, apparel, transportation, medical care, recreation, education are normal goods. Medical care demand was inelastic and had low income elasticity. All goods except transportation were complement to medical care. Analysis of subgroups revealed that demand of medical care increased with age and Caucasians had a higher demand compared to African-Americans. Poor people were found to be most sensitive to increase in the price of medical care for basic necessities like food, housing and medical care. If demand for medical care can act as a proxy to access and availability of medical care, it could be inferred that based on out-of-pocket expenditure (including health insurance premium) poor people most affected by price increase, which could influence their health outcomes. As lack of nutrition, good housing and medical care influence health outcomes in negative way, reduction of income inequality could increase affordability of basic necessities to indigent population and could create better health outcomes at population level.