Effects of Universal Health Insurance on Health Care Utilization, and Supply-Side Responses: Evidence from Japan

59 Pages Posted: 13 Nov 2012 Last revised: 4 Dec 2012

See all articles by Ayako Kondo

Ayako Kondo

University of Tokyo - Institute of Social Science

Hitoshi Shigeoka

Simon Fraser University (SFU); National Bureau of Economic Research (NBER)

Date Written: November 13, 2012

Abstract

We investigate the effects of a massive expansion in health insurance coverage on health care utilization and supply-side responses, by focusing on universal health insurance introduced in Japan in 1961. There are two major findings. First, health care utilization (measured in terms of admissions, inpatient days, and outpatient visits to hospitals) increased significantly. Second, we also find a supply response but the size of the supply response differs across service types: while the number of beds increases, effects on the number of medical institutions, physicians, and nurses are either negligible or inconclusive. Our results suggest that countries planning a large expansion in health insurance coverage would need to generate sufficient financial resources to cover the surge in health care expenditures, both in the short and long run. Our results also indicate that any slowdown in the supply-side response may constrain the ability of the health care system to meet increased demand.

Keywords: universal health insurance, health care utilization, supply-side response, Japan

Suggested Citation

Kondo, Ayako and Shigeoka, Hitoshi, Effects of Universal Health Insurance on Health Care Utilization, and Supply-Side Responses: Evidence from Japan (November 13, 2012). Available at SSRN: https://ssrn.com/abstract=2174761 or http://dx.doi.org/10.2139/ssrn.2174761

Ayako Kondo

University of Tokyo - Institute of Social Science ( email )

Hongo 7-3-1
Tokyo, TOKYO 113-0033
Japan

Hitoshi Shigeoka (Contact Author)

Simon Fraser University (SFU) ( email )

8888 University Drive
Burnaby, British Columbia V5A 1S6
Canada
(778)782-5348 (Phone)
(778)782-5348 (Fax)

HOME PAGE: http://sites.google.com/site/hshigeoka/

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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