Journal of Economic Perspectives
ISSN 0895-3309 (Print) | ISSN 1944-7965 (Online)
An Ounce of Prevention
Journal of Economic Perspectives
vol. 35,
no. 2, Spring 2021
(pp. 101–18)
(Complimentary)
Abstract
I look at prevention through an economic lens and make three main points. First, those advocating preventive measures are often asked how much money a given measure saves. This question is misguided. Rather, preventive measures can be thought of as insurance, with a certain cost in the present that may or may not pay off in the future. In fact, although most medical preventive measures improve expected health, they do not save money. Various lifestyle and early childhood interventions, however, may both save money and improve health. Second, preventive measures, including medical and lifestyle measures, are heterogeneous in their value, both across measures and within measure, across individuals. As a result, generalizations in everyday discourse about the value of prevention can be overly broad. Third, health insurance coverage for medical preventive measures should generally be more extensive than coverage for the treatment of a medical condition, though full coverage of preventive services is not necessarily optimal.Citation
Newhouse, Joseph P. 2021. "An Ounce of Prevention." Journal of Economic Perspectives, 35 (2): 101–18. DOI: 10.1257/jep.35.2.101Additional Materials
JEL Classification
- D61 Allocative Efficiency; Cost-Benefit Analysis
- G22 Insurance; Insurance Companies; Actuarial Studies
- H51 National Government Expenditures and Health
- I13 Health Insurance, Public and Private
- I18 Health: Government Policy; Regulation; Public Health
There are no comments for this article.
Login to Comment