“…Interest in the economic impacts of coverage extends far beyond the desk of the insurance executive and the blackboard of the academic economist: the major national health policy problem of the day is the high and rising cost of health care ; the nature and extent of health coverage are seen as both cause of and potential solution to this problem. Unlike the poorly understood relationship between risk rating and health behavior, there is a wealth of empirical studies relating to the impacts of insurance on the utilization of a wide variety of medical services , including ambulatory care (79,81,88), hospital care (9, 30, 32, 109), dental services (31), and mental health services (40,110) . Concern with the utilization encouraging effect of early-dollar coverage has produced several proposals for catastrophic-coverage national health insurance , dating back well over a de cade (24,29,78).…”