Should the Coinsurance Rate Be Increased in the Case of the Common Cold? An Analysis Based on an Original Survey

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in Masako IiYokohama National University AbstractThis article examines the choice of health care in Japan by patients suffering from the common cold. Original data were obtained from a survey conducted by the authors. Empirical results show that the price elasticity of demand for medical services is between 0.23 and 0.36. This estimated price elasticity suggests that if the new medical insurance reform plan were to increase the coinsurance rate by 10% both for those insured and their and dependants, national medical costs may be reduced by, at most, 43 billion yen (358 million US dollars); correspondingly, this could increase the demand for over-the-counter (OTC) medicine, at most, by 8.8 billion yen (73.3 million US dollars). This result implies that medical services and OTC medications are substitutes. Moreover, a tenfold increase in the provision of information on drugs could reduce national medical costs by 60 billion yen (500 million US dollars) at most, with a corresponding increase in the demand for OTC medications by about 6.9 billion yen (57.5 million U.S. dollars).JEL Classifications: I11,I12, I31, I18

When do people visit a doctor?

“…Reflecting this situation, highly developed statistical models are often utilized ( [2], [11], [12]). As for Japan, some use aggregate data ( [13], [14]), others use micro data ( [15], [16], [17]) to find a statistically significant negative price elasticity As Gilleski [5] describes, many studies, which consist of a Probit equation for the probability that people consult doctors or linear equations for medical expenditures, implicitly assume that people decide to consult a doctor or not before they get sick. This might not be realistic, and dynamic decision making should be incorporated.…”

“…For example, we are able to consider effects of symptoms which vary every day. Ii and Ohkusa ( [15], [16]) use Probit equations but pay attention to dynamic decision making; incorporating as exogenous variables the quadratic function of the number of days from the day when one gets sick. They find that price elasticity varies between the different kinds of sickness.…”