HKS Authors

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Two of the best known randomized trials in health economics are described in detail in this chapter, the RAND Health Insurance Experiment and the Oregon Health Insurance Experiment. The RAND Experiment randomized participants to health insurance plans that varied the cost of care from free care at one extreme to an approximation of a large deductible at the other. Those on free care plan increased their use of services about 30 percent relative to those on the large deductible plan. For the average participant there appeared to be little or no effect on health outcomes from this change in use. Among the poor with hypertension (high blood pressure), however, blood pressure was better controlled on the free care plan, which projected to about a 10 percent decrease in the risk of mortality. The Oregon Experiment randomized its participants to Medicaid or to remaining uninsured; those with Medicaid insurance used more services and suffered less from depression.


Newhouse, Joseph P. "The Use of Experiments in Health Care." The New Palgrave Dictionary of Economics. Ed. Steven N. Durlauf and Lawrence E. Blume. Palgrave Macmillan, 2015.