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National Information Center on Health Services Research and Health Care Technology (NICHSR)

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Introduction to Health Services Research : A Self-Study Course

Module 2: Brief History of Health Services Research (Page 24 of 40)

The Emphasis on and Importance of Health Economics and Research-Related Projects

Another major contributor to the ferment in health services research in the seventies was an increasing emphasis on health economics. (Note: Additional information and resources can be found in a companion e-learning course in Health Economics).

RAND Health Insurance Experiment (HIE)

This led to one of the great social experiments of the decade, the RAND Health Insurance Experiment (HIE) which started in 1971.

Snapshot of the Rand Health Insurance Experiment from the Rand Web site. This image opens a new window. Close the window to return here.

The HIE was organized by the RAND Corporation of California and initially supported by the Office of Economic Opportunity, and subsequently by the Department of Health, Education and Welfare (1971). Its centerpiece was a 15-year, multimillion-dollar project; it was a randomized field trial of alternative health insurance plans.

HIE Findings

Among the most important findings of the experiment were that the more families had to pay out of pocket, the fewer medical services they used, and that the reduced service had little or no health effect on the average person but adversely affected the health of the sick poor.

These findings had an enormous impact on the organization of both public and private health programs.

1974 Economic Crisis

In addition, the economic crisis that began in 1974 made cost containment the major priority of health policy and planning.

View Key Projects and Milestones in Health Services Research.

Discussion Questions

  1. You have read above about Rand's HIE research and it sounds very impressive (and the Rand Web site even describes it as "the most important health insurance study ever conducted," but just how important was the RAND Health Insurance Experiment (HIE) to the field of health economics and health services research? How do you know?
  2. After so many years, would the data files from the HIE still be of use to researchers? Describe why or why not.
  3. Examine some of the HIE publication citations. Do you recognize any of the researchers listed as authors on the abstracts? Which ones? Why are these people important today in health services research?
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