Effects of cost sharing on the demand for physician services in Japan: Evidence from a natural experiment
AbstractIn this paper, we investigate the effects of cost sharing on the demand for physician services in Japan by using a natural experiment, namely, the increase in the coinsurance rate for household heads in 1997. Our primary finding from the two-year data, which includes the transitory effects of the reform, is that the effects of the reform on the frequency of physician visits were negative and statistically significant, and that the effects of the reform on expenditures per visit were also negative. Based on these results, the arc elasticity of demand for physician services is -0.055. When we exclude the transitory period using the three-year data, the effects of the reform on the frequency of physician visits turn to be positive. It seems that the patients marginally curtailed the number of physician visits immediately after the reform; however, this effect was not sustained in the six months after the reform. We conclude that Japanese patients are not very price sensitive within the 10-20 percent range of coinsurance rate. Another important finding in our study is that the decrease in expenditure per visit retained even after the transitory period. This result suggests that the existence of a possible moral hazard in the treatment intensity although the decision-making process on the treatment intensity needs to be examined more carefully.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Elsevier in its journal Japan and the World Economy.
Volume (Year): 22 (2010)
Issue (Month): 1 (January)
Contact details of provider:
Web page: http://www.elsevier.com/locate/inca/505557
Demand for medical care Natural experiment Price elasticity Moral hazard Physician services;
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Chiappori, P.A. & Durand, F. & Geoffard, P.Y., 1998.
"Moral Hazard and the Demand for Physician Services: First Lessons from a French Natural Experiment,"
DELTA Working Papers
98-05, DELTA (Ecole normale supérieure).
- Chiappori, Pierre-Andre & Durand, Franck & Geoffard, Pierre-Yves, 1998. "Moral hazard and the demand for physician services: First lessons from a French natural experiment," European Economic Review, Elsevier, vol. 42(3-5), pages 499-511, May.
- Atsushi Yoshida & Shingo Takagi, 2002. "Effects of the Reform of the Social Medical Insurance System in Japan," The Japanese Economic Review, Japanese Economic Association, vol. 53(4), pages 444-465.
- Willard G. Manning & John Mullahy, 1999.
"Estimating Log Models: To Transform or Not to Transform?,"
NBER Technical Working Papers
0246, National Bureau of Economic Research, Inc.
- Manning, Willard G. & Mullahy, John, 2001. "Estimating log models: to transform or not to transform?," Journal of Health Economics, Elsevier, vol. 20(4), pages 461-494, July.
- Jayanta Bhattacharya & William B. Vogt & Aki Yoshikawa & Toshitaka Nakahara, 1996. "The Utilization of Outpatient Medical Services in Japan," Journal of Human Resources, University of Wisconsin Press, vol. 31(2), pages 450-476.
- Zweifel, Peter & Manning, Willard G., 2000. "Moral hazard and consumer incentives in health care," Handbook of Health Economics, in: A. J. Culyer & J. P. Newhouse (ed.), Handbook of Health Economics, edition 1, volume 1, chapter 8, pages 409-459 Elsevier.
- Manning, Willard G, et al, 1987. "Health Insurance and the Demand for Medical Care: Evidence from a Randomized Experiment," American Economic Review, American Economic Association, vol. 77(3), pages 251-77, June.
- Duan, Naihua, et al, 1983. "A Comparison of Alternative Models for the Demand for Medical Care," Journal of Business & Economic Statistics, American Statistical Association, vol. 1(2), pages 115-26, April.
- Cameron, A C & P. K. Trivedi & Frank Milne & J. Piggott, 1988. "A Microeconometric Model of the Demand for Health Care and Health Insurance in Australia," Review of Economic Studies, Wiley Blackwell, vol. 55(1), pages 85-106, January.
- Mari Kan & Wataru Suzuki, 2006. "The demand for medical care in Japan: initial findings from a Japanese natural experiment," Applied Economics Letters, Taylor & Francis Journals, vol. 13(5), pages 273-277.
- Rosett, Richard N & Huang, Lien-fu, 1973. "The Effect of Health Insurance on the Demand for Medical Care," Journal of Political Economy, University of Chicago Press, vol. 81(2), pages 281-305, Part I, M.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.