Monday, July 11, 2016

Beard and Leitzel (2016) on Compensated Live Kidney Donations

T. Randolph Beard and Jim Leitzel, “Compensated Live Kidney Donations,” 2016; a slightly earlier version, June 17, 2015, is available at http://ssrn.com/abstract=2619934. This paper builds upon Beard and Leitzel (2014).

• To what extent are problems associated with compensation for kidney donations actually problems that already exist in the current system and/or are problems stemming not from the transplant system directly but rather from the organ shortage? The argument presented here is that most problems associated with the provision of donor compensation are either problems in the uncompensated system, too (and tolerably well-addressed), or, are problems of shortage, not of compensation.

• Uncompensated organ donation decisions -- which are not exactly of the everyday variety with meaningful feedback to build upon -- might not be made in a particularly rational fashion. 

• Standard “behavioral” influences, such as risk misperceptions, loss aversion, endowment effects, and present bias, seem to push people in the direction of not being a live organ donor. 

• Safeguards (including the provision of Independent Donor Advocates) are built into the donation system to counter misinformed, rash, or imprudent (psychologically, medically, or otherwise) donations, as well as coerced donations. 

• The introduction of compensation does little in terms of introducing new problems, though it might exacerbate present bias in decisions to donate, or intensify the potential for loss aversion along the "financial expectations" axis.

• One desirable system with compensation would look like the current system, though supplemented with back-loaded compensation, both in-kind and monetary. 

• What are the likely effects of ending the kidney shortage, beyond the lives saved? Nine effects are identified: (1) a diagnosis of End-Stage Renal Disease becomes less devastating; (2) the reluctance to add patients to the transplant list dissipates; (3) the “who gets to live” question loses much of its salience; (4) patient incentives to seek out the black market evaporate; (5) the expansion of acceptability criteria for a kidney ends or is reversed; (6) one risk of donating a kidney declines, in that a donor is assured of being able to acquire one later him or herself; (7) the need for ESRD patients to plead their case for an organ is obviated; (8) family relationships become less strained by an ESRD diagnosis; (9) the incentives to take preventative measures to stave off kidney failure decline.

• So, eight of the dimensions affected by an end to the kidney shortage would alter for the better if the shortage were eliminated -- and the undesirable impact along the ninth dimension simply reflects the fact that an improvement in the treatment of a medical condition implies that the threat represented by the condition diminishes. 

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