PREVENTIVE CARE AND INSURANCE COVERAGE

This article examines how having a choice of health plans, HMO enrollment, and health status affect the use of preventive services. For preventive services use, HMO enrollment is endogenous for workers with a choice of plans, but is exogenous for workers who do not have a choice. Relative to a model that ignores the effect of a choice of plans, the effect of HMO enrollment on the use of preventive treatments is reduced. Individuals who do not have a choice of plans but are enrolled in HMOs are more likely to use preventive services than are individuals who choose HMOs. (JEL I10, I11, I12)