The Effects of Cost Sharing on Cancer Screening and Price Shopping: Evidence from the Affordable Care Act

Abstract

Colorectal cancer is the second leading cause of cancer-related mortality, but the cost-sharing environment for colonoscopies, the preferred form of screening, is complex. This paper combines a machine learning-based double-selection algorithm to perform principled covariate selection with differential exposure to the Affordable Care Act’s requirement that insurers fully cover cancer screening services as an instrumental variable to estimate the effect of cost sharing on colonoscopy utilization and price-shopping. The reduced form results show that the ACA’s requirements increased the use of colonoscopies by 1.7% and the IV results imply a price elasticity of 0.09. I do not find a price shopping response.