Empirical Models of Demand for Out-Patient Physician Services and Their Relevance to the Assessment of Patient Payment Policies: A Critical Review of the Literature
This paper reviews the existing empirical micro-level models of demand for out-patient physician services where the size of patient payment is included either directly as an independent variable (when a flat-rate co-payment fee) or indirectly as a level of deductibles and/or co-insurance defined by the insurance coverage. The paper also discusses the relevance of these models for the assessment of patient payment policies. For this purpose, a systematic literature review is carried out. In total, 46 relevant publications were identified. These publications are classified into categories based on their general approach to demand modeling, specifications of data collection, data analysis, and main empirical findings. The analysis indicates a rising research interest in the empirical micro-level models of demand for out-patient physician services that incorporate the size of patient payment. Overall, the size of patient payments, consumer socio-economic and demographic features, and quality of services provided emerge as important determinants of demand for out-patient physician services. However, there is a great variety in the modeling approaches and inconsistencies in the findings regarding the impact of price on demand for out-patient physician services. Hitherto, the empirical research fails to offer policy-makers a clear strategy on how to develop a country-specific model of demand for out-patient physician services suitable for the assessment of patient payment policies in their countries. In particular, theoretically important factors, such as provider behavior, consumer attitudes, experience and culture, and informal patient payments, are not considered. Although we recognize that it is difficult to measure these factors and to incorporate them in the demand models, it is apparent that there is a gap in research for the construction of effective patient payment schemes.
References
[1]
Ros, CC; Groenewegen, PP; Delnoij, DMJ. All rights reserved, or can we just copy? Cost sharing arrangements and characteristics of health care systems. Health Policy？2005, 52, 1–13.
[2]
Collins, D; Quick, JD; Musau, S; Kraushaar, K; Hussein, I. The fall and rise of cost sharing in Kenya: the impact of phased implementation. Health Policy？1996, 11, 52–63.
[3]
Saltman, R; Figueras, J. European Health Care Reform: Analysis of Current Strategies; World Health Organization: Copenhagen, Denmark, 1997.
[4]
Akashi, H; Yamada, T; Huot, E; Kana, LK; Sugimoto, T. User fees at a public hospital in Cambodia: effects on hospital performance and provider attitudes. Soc. Sci. Med？2004, 24, 1018–1029.
[5]
Smith, P. User charges and priority setting in health care: balancing equity and efficiency. J. Health Econ？2005, 24, 1018–1029.
[6]
Dalhlgren, G; Whitehead, M. A framework for assessing health systems from the public perspective: The ALPS approach. Int. J. Health Serv？2007, 37, 363–378.
[7]
Gardiol, L; Geoffard, P-Y; Grandchamp, C. Separating selection and incentive effects in health insurance: an econometric study of Swiss health insurance claims data. In Insurance Economics: Recent Advances; Chiappori, P-A, Gollier, C, Eds.; MIT Press: Cambridge, MA, USA, 2005.
[8]
Gaal, P; Evetovits, T; McKee, M. Informal payment for health care: evidence from Hungary. Health Policy？2006, 77, 86–102.
[9]
Lewis, M. Informal payments and the financing of health care in developing and transition coutries. Health Aff？2007, 26, 984–997.
[10]
Ensor, T. Informal payments for health care in transition economies. Health Policy？2004, 58, 237–246.
[11]
Lewis, M. Who is Paying for Health Care in Eastern Europe and Central Asia?; The World Bank: Washington, DC, USA, 2000.
[12]
Akin, JS; Griffin, CC; Guilkey, DK; Popkin, BM. The Demand for Primary Health Care Services in the Bicol Region of the Philippines. Econ. Dev. Cult. Change？1986, 34, 755–782.
[13]
Anderson, GM; Brook, R; Williams, A. A Comparison of Cost-Sharing versus Free Care in Children: Effects on the Demand for Office-Based Medical Care. Med. Care？1991, 29, 890–898.
[14]
Beck, RG. The Effects of Co-Payment on the Poor. J. Hum. Resour？1974, 9, 129–142.
[15]
Bessho, S; Ohkusa, Y. When do people visit a doctor? Health Care Manage. Sci？2006, 9, 5–18.
[16]
Bhattacharya, J; Vogt, WB; Yoshikawa, A; Nakahara, T. The Utilization of Outpatient Medical Services in Japan. J. Hum. Resour？1996, 31, 450–476.
[17]
Cauley, SD. The Time Price of Medical Care. Rev. Econ. Stat？1987, 69, 59–66.
[18]
Cecil, W; Barnes, J; Shea, T; Coultrer, S. Relationship of the use and costs of physician office visits and prescription drugs to travel distance and increases in member cost share. J. Manag. Care Pharm？2006, 12, 665–676.
[19]
Chawla, M; Ellis, RP. The impact of financing and quality changes on health care demand in Niger. Health Policy Plann？2000, 15, 76–84.
[20]
Cherkin, DC; Grothaus, L; Wagner, EH. The Effect of Office Visit Copayments on Utilization in a Health Maintenance Organization. Med. Care？1989, 27, 1036–1045.
[21]
Chiappori, PA; Durand, F; Geoffard, PY. Moral hazard and the demand for physician services: First lessons from a French natural experiment. Eur. Econ. Rev？1998, 42, 499–511.
[22]
Ching, P. User fees, demand for children’s health care and access across income groups: The Philippine case. Soc. Sci. Med？1995, 41, 37–46.
[23]
Cockx, B; Brasseur, C. The demand for physician services. Evidence from a natural experiment. J. Health Econ？2003, 22, 881–913.
[24]
Coffey, RM. The Effect of Time Price on the Demand for Medical-Care Services. J. Hum. Resour？1983, 18, 407–424.
[25]
Colle, AD; Grossman, M. Determinants of Pediatric Care Utilization. J. Hum. Resour？1978, 13, 115–158.
[26]
Deb, P; Trivedi, PK. The structure of demand for health care: latent class versus two-part models. J. Health Econ？2002, 21, 601–625.
[27]
Dong, H; Gbangou, A; De Allegri, M; Pokhrel, S; Sauerborn, R. The differences in characteristics between health-care users and non-users: implication for introducing community-based health insurance in Burkina Faso. Eur. J. Health Econ？2008, 9, 41–50.
[28]
Dow, WH. Flexible Discrete Choice Demand Models Consistent with Utility Maximization: An Application to Health Care Demand. Am. J. Agr. Econ？1999, 81, 680–685.
[29]
Ellis, RP; McInnes, DK; Stephenson, EH. Inpatient and outpatient health care demand in Cairo, Egypt. Health Econ？1994, 3, 183–200.
[30]
Escarce, JJ; Kapur, K; Joyce, GF; van Vorst, KA. Medical care expenditures under gatekeeper and point-of-service arrangements. Health Serv. Res？2001, 36, 1037–1057.
[31]
Fabbri, D; Monfardini, C. Rationing the public provision of healthcare in the presence of private supplements: Evidence from the Italian NHS. J. Health Econ？2009, 28, 290–304.
[32]
Gerfin, M; Schellhorn, M. Nonparametric bounds on the effect of deductibles in health care insurance on doctor visits—Swiss evidence. Health Econ？2006, 15, 1011–1020.
[33]
Gertler, P. Are user fees regressive? The welfare implications of health care proposals in Peru. J. Econometrics？1987, 36, 67–88.
[34]
Goldman, F; Grossman, M. The Demand for Pediatric Care: An Hedonic Approach. J. Polit. Econ？1978, 86, 259–280.
[35]
Helms, J; Newhouse, JP; Phelps, CE. Copayments and Demand for Medical Care: The California Medicaid Experience. Bell J. Econ？1978, 9, 192–208.
[36]
Hunt-McCool, J; Kiker, B; Ng, YC. Estimates of the demand for medical care under different functional forms. J. Appl. Econom？1994, 9, 201–218.
[37]
Jung, K-T. Influence of the introduction of a per-visit copayment on health care use and expenditures: the Korean experience. J. Risk Insur？1998, 65, 33–56.
[38]
Keeler, EB; Rolph, JE. The demand for episodes of treatment in the health insurance experiment. J. Health Econ？1988, 7, 337–367.
[39]
Lu, C; Frank, RG; Mcguire, TG. Demand response to cost sharing under managed health care. Contemp. Econ. Policy？2009, 27, 1–15.
[40]
Manning, WG; Newhouse, JP; Duan, N; Keeler, EB; Leibowitz, A. Health Insurance and the Demand for Medical Care: Evidence from a Randomized Experiment. Am. Econ. Rev？1987, 77, 251–277.
[41]
Mariko, M. Quality of care and the demand for health services in Bamako, Mali: the specific roles of structural, process, and outcome components. Soc. Sci. Med？2003, 56, 1183–1196.
[42]
Mataria, A; Luchini, S; Daoud, Y; Moatti, J-P. Demand assessment and price-elastisity estimation of quality-improved primary health care in Palestine: a contribution from the contingent valuation method. Health Econ？2007, 16, 1051–1068.
[43]
Meyerhoefer, CD; Sahn, DE; Younger, SD. The joint demand for health care, leisure, and commodities: Implications for health care finance and access in Vietnam. J. Devel. Stud？2007, 43, 1475–1500.
[44]
Pokhrel, S; Hidayat, B; Flessa, S; Sauerborn, R. Modelling the effectiveness of financing policies to address underutilization of children’s health services in Nepal. B. World Health Org？2005, 83, 338–344.
[45]
Puig-Junoy, J; Saez, M; Martinez-Garcia, E. Why do patients prefer hospital emergency visits? A nested logit analysis for patient-initiated contacts. Health Care Manage. Sci？1998, 1, 39–52.
[46]
Qian, D; Pong, RW; Yin, A; Nagarajan, KV; Meng, Q. Determinants of health care demand in poor, rural China: the case of Gansu Province. Health Policy Plann？2009, 24, 1–11.
[47]
Saeuerborn, R; Nougtara, A; Latiemer, E. The elasticity of demand for health care in Burkina Faso: differences across age and income groups. Health Policy Plann？1994, 9, 185–192.
[48]
Sahn, DE; Younger, SD; Genicot, G. The demand for health care services in rural Tanzania. Oxford B. Econ. Stat？2003, 65, 241–259.
[49]
Scheffler, RM. The United Mine Workers’ Health Plan: An Analysis of the Cost-Sharing Program. Med. Care？1984, 22, 247–254.
[50]
Schellhorn, M. The effect of variable health insurance deductibles on the demand for physician visits. Health Econ？2001, 10, 441–456.
[51]
Schreyogg, J; Grabka, M. Copayments for ambulatory care in Germany: A natural experiment using a difference-in-difference approach. Eur. J. Health Econ？2010, 11, 331–341.
[52]
van de Voorde, C; van Doorslaer, E; Schokkaert, E. Effects of cost-sharing on physician utiliaztion under favorable conditions for supplier-induced demand. Health Econ？2001, 10, 457–471.
[53]
van der Gaag, J; van de Ven, W. The Demand for Primary Health Care. Med. Care？1978, 16, 299–312.
[54]
Van Vliet, RCJA. Effects of price and deductibles on medical care demand, estimated from survey data. Appl. Econ？2001, 33, 1515–1524.
[55]
Van Vliet, RCJA. Deductibles and Health Care Expenditures: Empirical Estimates of Price Sensitivity Based on Administrative Data. Int. J. Health Care Fin. Econ？2004, 4, 283–305.
[56]
Vistnes, JP; Hamilton, V. The Time and Monetary Costs of Outpatient Care for Children. Am. Econ. Rev？1995, 85, 117–121.
[57]
Wedig, GJ. Health status and the demand for health: results on price elasticities. J. Health Econ？1988, 7, 151–163.
[58]
Bodenheimer, T. High and rising health care costs. Part 1: Seeking an explanation. Ann. Intern. Med？2005, 142, 847–854.
[59]
Bridges, J. Stated preference methods in health care evaluation: an emerging methodological paradigm in health economics. Appl. Health Econ. Health Policy？2003, 2, 224.
[60]
Bhatia, MR; Fox-Rushby, JA. Validity of willingness to pay: hypothetical versus actual payments. Appl. Econ. Letters？2003, 10, 737–740.
[61]
Botelho, A; Costa Pinto, L. Hypothetical, real and predicted real willingness to pay in open-ended survey: experimental results. Appl. Econ. Letters？2002, 9, 993–996.
[62]
Foreit, JR; Foreit, KGF. The reliability and the validity of willingness to pay surveys for reproductive health pricing decisions in devolving countries. Health Policy？2002, 63, 37–47.
[63]
Groot, W; van den Brink, H. A direct method for estimating the compensating income variation for severe headache and migraine. Soc. Sci. Med？2004, 58, 305–314.
[64]
Louviere, JJ; Hensher, DA. Combining sources of preference data. In Travel Behaviour Research: the Leading Edge; Hensher, DA, Ed.; Pergamon: Oxford, UK, 2001; pp. 125–144.
[65]
Killingsworth, J; Hossain, N; Hedrick-Wong, Y; Thomas, S; Rahman, A; Begum, T. Unofficial fees in Bangladesh: price, equity and institutional issues. Health Policy Plann？1999, 14, 152–163.
[66]
Newhouse, J; McClellan, M. Econometrics in outcomes research: The use of instrumental variables. Annu. Rev. Publ. Health？1998, 19, 17–34.
[67]
Angrist, J; Krueger, A. Instrumental variables and the search for identification: from supply and demand to natural experiments. J. Econ. Perspect？2001, 15, 69–85.
[68]
Windmeijer, FAG; Santos Silva, JMC. Endogeneity in count data models: an application to demand for health care. J. Appl. Econom？1997, 12, 281–294.
[69]
Besley, TJ; Case, A. Unnatural experiments? Estimating the incidence of endogenous policies. Econ. J？2000, 10, 672–694.
[70]
Ellis, RP; McGuire, TG. Optimal payment systems for health services. J. Health Econ？1990, 9, 375–395.
[71]
Folmer, K; Stevens, J; van Tulder, F; Westerhout, E. Towards an economic model of the Dutch health care sector. Health Econ？1997, 6, 351–363.
