The Effect of Patient Cost Sharing on Utilization, Health, and Risk Protection
American Economic Review · 2014 · Volume 104 · Issue 7
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
Insurance, Insurance Companies, Actuarial Studies, Analysis of Health Care Markets, Health Production, Health Insurance, Public and Private, Health: Government Policy, Regulation, Public Health, Economics of the Elderly, Economics of the Handicapped, Non-labor Market Discrimination
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