Working Paper: NBER ID: w19726
Authors: Hitoshi Shigeoka
Abstract: This paper exploits a sharp reduction in patient cost sharing at age 70 in Japan, using a regression discontinuity design to examine its effect on utilization, health, and financial risk arising from out-of-pocket expenditures. Due to the national policy, cost sharing is 60-80 percent lower at age 70 than at age 69. I find that both outpatient and inpatient care are price sensitive among the elderly. While I find little impact on mortality and other health outcomes, the results show that reduced cost sharing is associated with lower out-of-pocket expenditures, especially at the right tail of the distribution.
Keywords: Patient Cost Sharing; Health Care Utilization; Elderly; Financial Risk Protection
JEL Codes: I11; I18
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Reduction in patient cost sharing at age 70 (G52) | Increase in health care utilization (I11) |
| Reduction in patient cost sharing at age 70 (G52) | Increase in outpatient visits (I11) |
| Reduction in patient cost sharing at age 70 (G52) | Increase in inpatient admissions (I11) |
| Reduction in patient cost sharing at age 70 (G52) | Increase in outpatient visits for ambulatory care sensitive conditions (ACSCs) (I11) |
| Reduction in patient cost sharing at age 70 (G52) | Reduction in out-of-pocket expenditures (H51) |
| Increase in health care utilization (I11) | No improvement in health outcomes (mortality or self-reported health status) (I14) |