How much is a health insurer willing to pay for Colorectal Cancer screening tests?


Colorectal Cancer (CRC) screening tests have proven to be cost-effective in preventing cancer incidence. Yet, as recent studies have shown, CRC screening tests are noticeably underutilized. Among the factors influencing CRC screening test utilization, the role of health insurers has gained considerable attention in recent studies. In this paper, we propose an analytical model for the market of CRC screening tests and show how the insurer can benefit from a computer simulation model to cope with the problem of incomplete and asymmetric information inherent in this market. Our estimates reveal that promoting CRC screening tests is not necessarily economically attractive to the insurer, unless the insurer's valuation of life is greater than a certain limit. We use the proposed model to estimate such a threshold - the insurer's willingness-to-pay to acquire one additional life year by covering the CRC screening tests.

MIDAS Network Members