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Can the Health Insurance Reforms stop an increase in medical costs of middle- and old-aged persons in Japan?

Author

Listed:
  • Tamie Matsuura

    (NLI Research Institute)

  • Masaru Sasaki

    () (ISER, Osaka University)

Abstract

Using two-period panel data from the Nippon Life Insurance Research Institute, this paper tests the hypothesis that an increase in the self-pay ratio of medical expenditures associated with the Japanese health insurance reforms of April 2003 reduced individual medical costs. We find that the increase in the self-pay ratio of medical expenditures has a trivial effect on household medical expenses, implying that a decrease in the quantity demanded for medical services offsets the increase in medical costs. However, according to quantile regression estimates, an increase in the self-pay ratio of medical expenditures has a significantly positive effect on the share of medical costs for relatively high quantile values. This provides corroborating evidence that an increase in the self-pay ratio cannot cut the demand for medical services relatively more for those bearing a higher share of medical costs in household expenditure. An additional finding is that medical services are a necessity good, particularly for those with a relatively high share of medical costs in household expenditure.

Suggested Citation

  • Tamie Matsuura & Masaru Sasaki, 2010. "Can the Health Insurance Reforms stop an increase in medical costs of middle- and old-aged persons in Japan?," Discussion Papers in Economics and Business 10-13, Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP).
  • Handle: RePEc:osk:wpaper:1013
    as

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    References listed on IDEAS

    as
    1. 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.
    2. Yoshida, Atsushi & Kawamura, Akira, 2009. "Who has benefited from the health services system for the elderly in Japan?," Japan and the World Economy, Elsevier, vol. 21(3), pages 256-269, August.
    3. 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.
    4. 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.
    5. 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.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    health insurance; medical costs; Engle curve; middle- and old-aged persons; Japan;

    JEL classification:

    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

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