IDEAS home Printed from https://ideas.repec.org/a/eee/socmed/v339y2023ics0277953623007128.html
   My bibliography  Save this article

Small money, big change: The distributional impact of differentiated doctor's visit fee on healthcare utilization

Author

Listed:
  • Wang, Tianyu
  • Wen, Ke
  • Gao, Qiuming
  • Sun, Ruochen

Abstract

A prominent issue in China's healthcare sector is the overcrowding of high-tier hospitals, whereas low-tier hospitals and community health centers are severely underutilized. This study aims to examine whether doctor's visit fee and copay differentiated by the level of healthcare providers can change the distribution of outpatient visits across different levels of healthcare providers. By leveraging the exogeneity of the policy change implemented in a megacity in China in 2017, we apply a parametric discontinuity regression model to study the causal impact of differentiated pricing on patients' health-seeking behavior, using a large-scale insurance claim database. We find that the reform of differentiated doctor's visit fee schedule effectively increases the proportion of visits to primary care facilities among all outpatient visits. This effect is driven by a decline in visits to the highest-tier hospitals and an increase in visits to community healthcare centers. Furthermore, the policy effects are more pronounced among the elderly and people with chronic diseases. Our results suggest that shifting the focus of pricing policies from coinsurance to copays while continuing to improve the capacity of primary care facilities is an effective way to facilitate triaging patients into different levels of care without triggering moral hazard.

Suggested Citation

  • Wang, Tianyu & Wen, Ke & Gao, Qiuming & Sun, Ruochen, 2023. "Small money, big change: The distributional impact of differentiated doctor's visit fee on healthcare utilization," Social Science & Medicine, Elsevier, vol. 339(C).
    • Handle: RePEc:eee:socmed:v:339:y:2023:i:c:s0277953623007128
    DOI: 10.1016/j.socscimed.2023.116355
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0277953623007128
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.socscimed.2023.116355?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Lindsay M. Sabik & Sabina Ohri Gandhi, 2016. "Copayments and Emergency Department Use Among Adult Medicaid Enrollees," Health Economics, John Wiley & Sons, Ltd., vol. 25(5), pages 529-542, May.
    2. Dolton, Peter & Pathania, Vikram, 2016. "Can increased primary care access reduce demand for emergency care? Evidence from England's 7-day GP opening," Journal of Health Economics, Elsevier, vol. 49(C), pages 193-208.
    3. Manasi Deshpande, 2016. "Does Welfare Inhibit Success? The Long-Term Effects of Removing Low-Income Youth from the Disability Rolls," American Economic Review, American Economic Association, vol. 106(11), pages 3300-3330, November.
    4. Jakobsson, Niklas & Svensson, Mikael, 2016. "Copayments and physicians visits: A panel data study of Swedish regions 2003–2012," Health Policy, Elsevier, vol. 120(9), pages 1095-1099.
    5. Atul Gupta, 2021. "Impacts of Performance Pay for Hospitals: The Readmissions Reduction Program," American Economic Review, American Economic Association, vol. 111(4), pages 1241-1283, April.
    6. Liran Einav & Amy Finkelstein, 2018. "Moral Hazard in Health Insurance: What We Know and How We Know It," Journal of the European Economic Association, European Economic Association, vol. 16(4), pages 957-982.
    7. Zhou, Mei & Zhao, Shaoyang & Fu, Mingwei, 2021. "Supply-induced demand for medical services under price regulation: Evidence from hospital expansion in China," China Economic Review, Elsevier, vol. 68(C).
    8. Shen, Menghan & He, Wen & Li, Linyan, 2020. "Incentives to use primary care and their impact on healthcare utilization: Evidence using a public health insurance dataset in China," Social Science & Medicine, Elsevier, vol. 255(C).
    9. Pinchbeck, Edward W., 2019. "Convenient primary care and emergency hospital utilisation," Journal of Health Economics, Elsevier, vol. 68(C).
    10. Amitabh Chandra & Jonathan Gruber & Robin McKnight, 2010. "Patient Cost-Sharing and Hospitalization Offsets in the Elderly," American Economic Review, American Economic Association, vol. 100(1), pages 193-213, March.
    11. Matias D. Cattaneo & Nicolas Idrobo & Rocio Titiunik, 2019. "A Practical Introduction to Regression Discontinuity Designs: Foundations," Papers 1911.09511, arXiv.org.
    12. Yu, Jianxing & Qiu, Yue & He, Ziying, 2020. "Is universal and uniform health insurance better for China? Evidence from the perspective of supply-induced demand," Health Economics, Policy and Law, Cambridge University Press, vol. 15(1), pages 56-71, January.
    13. 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.
    14. Yun Liu & Qingxia Kong & Shasha Yuan & Joris van de Klundert, 2018. "Factors influencing choice of health system access level in China: A systematic review," PLOS ONE, Public Library of Science, vol. 13(8), pages 1-21, August.
    15. Zhou, Zhongliang & Zhao, Yaxin & Shen, Chi & Lai, Sha & Nawaz, Rashed & Gao, Jianmin, 2021. "Evaluating the effect of hierarchical medical system on health seeking behavior: A difference-in-differences analysis in China," Social Science & Medicine, Elsevier, vol. 268(C).
    16. Niklas Jakobsson & Mikael Svensson, 2016. "The effect of copayments on primary care utilization: results from a quasi-experiment," Applied Economics, Taylor & Francis Journals, vol. 48(39), pages 3752-3762, August.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Simona Gamba & Niklas Jakobsson & Mikael Svensson, 2022. "The impact of cost-sharing on prescription drug demand: evidence from a double-difference regression kink design," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 23(9), pages 1591-1599, December.
    2. Johansson, Naimi & de New, Sonja C. & Kunz, Johannes S. & Petrie, Dennis & Svensson, Mikael, 2023. "Reductions in out-of-pocket prices and forward-looking moral hazard in health care demand," Journal of Health Economics, Elsevier, vol. 87(C).
    3. Berger, Michael & Six, Eva & Czypionka, Thomas, 2024. "Policy implications of heterogeneous demand reactions to changes in cost-sharing: Patient-level evidence from Austria," Social Science & Medicine, Elsevier, vol. 340(C).
    4. Emmanuel Nshakira-Rukundo & Essa Chanie Mussa & Nathan Nshakira & Nicolas Gerber & Joachim von Braun, 2021. "Impact of community-based health insurance on utilisation of preventive health services in rural Uganda: a propensity score matching approach," International Journal of Health Economics and Management, Springer, vol. 21(2), pages 203-227, June.
    5. Klein, Tobias J. & Salm, Martin & Upadhyay, Suraj, 2024. "Patient Cost-Sharing and Redistribution in Health Insurance," IZA Discussion Papers 16778, Institute of Labor Economics (IZA).
    6. Minke Remmerswaal & Jan Boone & Rudy Douven, 2019. "Selection and moral hazard effects in healthcare," CPB Discussion Paper 393.rdf, CPB Netherlands Bureau for Economic Policy Analysis.
    7. Patrick Carlin & Brian E. Dixon & Kosali I. Simon & Ryan Sullivan & Coady Wing, 2022. "How Undervalued is the Covid-19 Vaccine? Evidence from Discrete Choice Experiments and VSL Benchmarks," NBER Working Papers 30118, National Bureau of Economic Research, Inc.
    8. Berger, Michael & Six, Eva & Czypionka, Thomas, 2024. "Policy implications of heterogeneous demand reactions to changes in cost-sharing: patient-level evidence from Austria," LSE Research Online Documents on Economics 121162, London School of Economics and Political Science, LSE Library.
    9. Kurt Lavetti & Thomas DeLeire & Nicolas R. Ziebarth, 2023. "How do low‐income enrollees in the Affordable Care Act marketplaces respond to cost‐sharing?," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 90(1), pages 155-183, March.
    10. Ha Trong Nguyen & Luke B Connelly, 2017. "Cost-sharing in health insurance and its impact in a developing country: evidence from a quasi-natural experiment," Bankwest Curtin Economics Centre Working Paper series WP1702, Bankwest Curtin Economics Centre (BCEC), Curtin Business School.
    11. Andrey Aistov & Ekaterina Aleksandrova & Christopher J. Gerry, 2021. "Voluntary private health insurance, health-related behaviours and health outcomes: evidence from Russia," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 22(2), pages 281-309, March.
    12. Marika Cabral & Mark R. Cullen, 2017. "The Effect Of Insurance Coverage On Preventive Care," Economic Inquiry, Western Economic Association International, vol. 55(3), pages 1452-1467, July.
    13. Rob J. M. Alessie & Viola Angelini & Jochen O. Mierau & Laura Viluma, 2020. "Moral hazard and selection for voluntary deductibles," Health Economics, John Wiley & Sons, Ltd., vol. 29(10), pages 1251-1269, October.
    14. Boone, Claire E & Celhay, Pablo & Gertler, Paul & Gracner, Tadeja & Rodriguez, Josefina, 2022. "How scheduling systems with automated appointment reminders improve health clinic efficiency," Journal of Health Economics, Elsevier, vol. 82(C).
    15. Wei, Zhongyu & Bai, Jianjun & Feng, Ruitao, 2023. "Optimization referral rate design for hierarchical diagnosis and treatment system based on accessibility-utilization efficiency bi-objective collaboration: A case study of China," Social Science & Medicine, Elsevier, vol. 322(C).
    16. Mauro Laudicella & Paolo Li Donni, 2022. "The dynamic interdependence in the demand of primary and emergency secondary care: A hidden Markov approach," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 37(3), pages 521-536, April.
    17. Guo, Audrey & Zhang, Jonathan, 2019. "What to expect when you are expecting: Are health care consumers forward-looking?," Journal of Health Economics, Elsevier, vol. 67(C).
    18. Samantha E. Clark & Ruth Etzioni & Jerry Radich & Zachary Marcum & Anirban Basu, 2023. "The price elasticity of Gleevec in patients with Chronic Myeloid Leukemia enrolled in Medicare Part D: Evidence from a regression discontinuity design," Papers 2305.06076, arXiv.org.
    19. Jakobsson, Niklas & Svensson, Mikael, 2016. "Copayments and physicians visits: A panel data study of Swedish regions 2003–2012," Health Policy, Elsevier, vol. 120(9), pages 1095-1099.
    20. Francetic, I.N.;, 2022. "Selection on moral hazard in the Swiss market for mandatory health insurance: Empirical evidence from Swiss Household Panel data," Health, Econometrics and Data Group (HEDG) Working Papers 22/24, HEDG, c/o Department of Economics, University of York.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:socmed:v:339:y:2023:i:c:s0277953623007128. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/315/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.