Working Paper: NBER ID: w20873
Authors: Feng Huang; Li Gan
Abstract: At the end of 1998, China launched a government-run mandatory insurance program, the Urban Employee Basic Medical Insurance (UEBMI), to replace the previous medical insurance system. Using the UEBMI reform in China as a natural experiment, this study identify variations in patient cost sharing that were imposed by the UEBMI reform and examine their effects on the demand for health-care services. Using data from the 1991-2006 waves of the China Health and Nutrition Survey, we find that the increased cost sharing is associated with decreased outpatient medical care utilization and expenditures but not with decreased inpatient care utilization and expenditures. Patients from low- and middle-income households, or in less-serious medical situations are found to be more sensitive to prices. We observe little impact on patient health, as measured by self-reported poor health status.
Keywords: health insurance; cost sharing; healthcare utilization; China
JEL Codes: I11; I13
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| increased cost sharing (G52) | significant decrease in outpatient medical care utilization (I11) |
| increased cost sharing (G52) | reduction in outpatient expenditures (H51) |
| increased cost sharing (G52) | no significant effect on inpatient care utilization (I11) |
| increased cost sharing (G52) | no significant effect on health outcomes (I12) |