DOI QR코드

DOI QR Code

The Impact of Supplier Induced Demand on Increase in Medical Aid Expenditure

의료급여비용 증가에 공급자 유인효과가 미치는 영향

  • Shin, Hyunwoung (Korea Institute for Health and Social Affairs) ;
  • Yoon, Jangho (College of public health and health science, Oregon State University) ;
  • Noh, Yunhong (Medical Campus, Gachon University) ;
  • Yeo, Ji-Young (Korea Institute for Health and Social Affairs)
  • 신현웅 (한국보건사회연구원) ;
  • 윤장호 (오리건주립대학교 보건과학대학) ;
  • 노연홍 (가천대학교 메디컬캠퍼스) ;
  • 여지영 (한국보건사회연구원)
  • Received : 2013.12.23
  • Accepted : 2014.03.24
  • Published : 2014.03.31

Abstract

Background: A need arises to efficiently control health expenditure for medical aid due to a sharp increase in medical aid expenditure. This study experimently analyzes the impact of physician behavior on medical use for medical aid beneficiaries using supplier induced demand (SID) theory. Methods: This study looks into analyze SID effect using expenditure factor analysis of medical aid for the years between 2003 and 2010 in comparison with health insurance. Moreover, this study analyzes the existence and scale of SID using econometrics modeling with panel data on 16 cities and provinces's health expenditure data for medical aid from 2003 1/4 to 2010 4/4. Results: This study finds that the growth rate of visit days per capita and treatment amount per visit days for medical aid is higher than health insurance. Furthermore, the result of econometrics modeling analysis shows the existence of SID in general hospital, hospital, clinic, oriental clinic. Conclusion: In order to efficiently control expenditure for medical aid, it is required to reinforce macro polices such as the introduction of 'target management' and micro policies such as the strengthen of management on medical institutes in the perspective of suppliers as well as regulations of demanders.

Keywords

References

  1. Lee KS. Financing & delivering health care. 3rd ed. Seoul: Gyechuk Munwhasa; 2013.
  2. Shin HW, Shin YS, Ahn HS, Hwang DK, Kim HJ. Selection criteria of medical aid beneficiaries with regarded to healthcare needs. Seoul: Korea Institute for Health and Social Affairs; 2007.
  3. Shin HW, Shin YS, Hwang DK, Kim SR, Yoon SJ. Improvement of health care supplier system for Medical Aid. Seoul: Ministry of Health and Welfare, Korea Institute for Health and Social Affairs; 2007.
  4. Shin YJ. Recent trend n policy around Medical Aid. Trend Welf 2006: 5;27.
  5. Pauly MV. Doctors and their workshops: economic model of physician behavior. Chicago: University Chicago Press; 1980.
  6. Fuchs VR. The supply of surgeons and the demand for operations. J Hum Resour 1978;13 Suppl:35-56. https://doi.org/10.2307/145247
  7. Roemer MI. Bed supply and hospital utilization: a natural experiment. Hospitals 1961;35:36-42.
  8. Jurges H. Health insurance status and physician induced demand for medical services in Germany: new evidence from combined district and individual data. Mannheim: Mannheim Research Institute for the Economics of Aging; 2007.
  9. Arrow KJ. Uncertainty and the welfare economics of medical care. Am Econ Rev 1963;53:941-973.
  10. Evans RG. Supplier-induced demand: some empirical evidence and implications. Econ Health Med Care 1974;6:162-173.
  11. Richardson J. The inducement hypothesis: that doctors generate demand for their ownservices. In: van der Gaag J, Perlman M, editors. Health, economics and health economics: proceedings of the World Congress on Health Economics, Leiden, The Netherlands, September 1980. Amsterdam: North-Holland Publishing Co.; 1981. pp. 189-214.
  12. Feldstein P. Health care economics. New York: John Wiley and Sons; 2005.
  13. Labelle R, Stoddart G, Rice T. A re-examination of the meaning and importance of supplier-induced demand. J Health Econ 1994;13(3):347-368. https://doi.org/10.1016/0167-6296(94)90036-1
  14. Hughes D, Yule B. Incentives and the remuneration of general practitioners. Aberdeen: University of Aberdeen; 1991.
  15. Hillman AL, Pauly MV, Kerstein JJ. How do financial incentives affect physicians' clinical decisions and the financial performance of health maintenance organizations? N Engl J Med 1989;321(2):86-92. https://doi.org/10.1056/NEJM198907133210205
  16. Manning WG, Leibowitz A, Goldberg GA, Rogers WH, Newhouse JP. A controlled trial of the effect of a prepaid group practice on use of services. N Engl J Med 1984;310(23):1505-1510. https://doi.org/10.1056/NEJM198406073102305
  17. Epstein AM, Begg CB, McNeil BJ. The use of ambulatory testing in prepaid and fee-for-service group practices. Relation to perceived profitability. N Engl J Med 1986;314(17):1089-1094. https://doi.org/10.1056/NEJM198604243141706
  18. Welch WP, Hillman AL, Pauly MV. Toward new typologies for HMOs. Milbank Q 1990;68(2):221-243. https://doi.org/10.2307/3350097
  19. Murray JP, Greenfield S, Kaplan SH, Yano EM. Ambulatory testing for capitation and fee-for-service patients in the same practice setting: relationship to outcomes. Med Care 1992;30(3):252-261. https://doi.org/10.1097/00005650-199203000-00007
  20. Shain M, Roemer MI. Hospital costs relate to the supply of beds. Mod Hosp 1959;92(4):71-73.
  21. Cromwell J, Mitchell JB. Physician-induced demand for surgery. J Health Econ 1986;5(4):293-313. https://doi.org/10.1016/0167-6296(86)90006-8
  22. Carlsen F, Grytten J. More physicians: improved availability or induced demand? Health Econ 1998;7(6):495-508. https://doi.org/10.1002/(SICI)1099-1050(199809)7:6<495::AID-HEC368>3.0.CO;2-S
  23. Sorensen RJ, Grytten J. Competition and supplier-induced demand in a health care system with fixed fees. Health Econ 1999;8(6):497-508. https://doi.org/10.1002/(SICI)1099-1050(199909)8:6<497::AID-HEC439>3.0.CO;2-D
  24. Grytten J, Carlsen F, Sorensen R. Supplier inducement in a public health care system. J Health Econ 1995;14(2):207-229. https://doi.org/10.1016/0167-6296(94)00036-4
  25. Delattre E, Dormont B. Fixed fees and physician-induced demand: a panel data study on French physicians. Health Econ 2003;12(9):741-754. https://doi.org/10.1002/hec.823
  26. Roberfroid D, Stordeur S, Camberlin C, van de Voorde C, Vrijens F, Leonard C. Physician workforce supply in Belgium: current situation and challenges. Brussels: Belgian Health Care Knowledge Centre; 2008.
  27. Kim CB. Test of physician-induced demand in Korea [dissertation]. Seoul: Yonsei University; 2002.
  28. Park HK. Effects of hospital competition on the average length of stay and cost per inpatient day [dissertation]. Seoul: Seoul National university; 2005.
  29. Sakong J, Kwon EJ. A study of the effect of hospital competition on the behavior of the health care suppliers. Korean J Health Econ Policy 2011;17(2):1-33.
  30. Hickson GB, Altemeier WA, Perrin JM. Physician reimbursement by salary or fee-for-service: effect on physician practice behavior in a randomized prospective study. Pediatrics 1987;80(3):344-350.
  31. Krasnik A, Groenewegen PP, Pedersen PA, von Scholten P, Mooney G, Gottschau A, et al. Changing remuneration systems: effects on activity in general practice. BMJ 1990;300(6741):1698-1701. https://doi.org/10.1136/bmj.300.6741.1698
  32. Madden D, Nolan A, Nolan B. GP reimbursement and visiting behaviour in Ireland. Health Econ 2005;14(10):1047-1060. https://doi.org/10.1002/hec.995
  33. Moon JH. A study of the suppler-induced demand hypothesis in the Korean medical industry [dissertation]. Seoul: Yonsei University; 1999.
  34. Shin MK. Empirical analysis of supplier-induced demand using MRI service claims data [dissertation]. Seoul: Yonsei University; 2009.
  35. Staiger D, James HS. Instrumental variables regression with weak instruments. Econometrica 1997;65:557-586. https://doi.org/10.2307/2171753
  36. Hansen L. Large sample properties of generalized method of moments estimators. Econometrica 1982;50(3):1029-1054. https://doi.org/10.2307/1912775
  37. Phelps CE. Induced demand: can we ever know its extent? J Health Econ 1986;5(4):355-365. https://doi.org/10.1016/0167-6296(86)90010-X
  38. Peacock SJ, Richardson JR. Supplier-induced demand: re-examining identification and misspecification in cross-sectional analysis. Eur J Health Econ 2007;8(3):267-277. https://doi.org/10.1007/s10198-007-0044-7