Adaptation to health states: Sick yet better off?

Healthcare funding decisions in the UK rely on health state valuations of the general public. However, it has been shown that there is disparity between the valuation of the impact of hypothetical conditions on health and the reported health by those experiencing them. Patients' adaptation to health states is among the most common explanations for this discrepancy. Being diagnosed with a disease appears to affect individual perception of health over time so that better subjective health may be reported over a disease trajectory. This paper examines adaptation to health states using a longitudinal dataset. We use four waves of the British Cohort Study (BCS70), which tracks a sample of British individuals since birth in 1970 and contains information on self-assessed health (SAH), morbidity, and socioeconomic characteristics. We implement a dynamic ordered probit model controlling for health state dependence. Results are supportive of the existence of adaptation: Time since diagnosis has a positive impact on SAH. Moreover, adaptation happens over relatively long durations. We do not find significant results proving different adaptation paths for patients reporting prior better SAH. The analysis by specific conditions generally supports the existence of adaptation, but results are statistically significant only for a subset of conditions.