The Impact of Relative Price Changes in Healthcare on Hospital Choices and Economic Implications: Evidence from China

Speaker：Wang Jiyuan, Associate Professor, Central University of Finance and Economics

Host：Cheng Chunli, Associate Professor, Lingnan College

Time and Date：10:00, January 8, 2024 (Monday)

Venue：Wang Daohan Meeting Room (101), Lingnan Hall

Language: English + Chinese

Abstract：

In a healthcare market where patients can freely choose hospitals, it is important to understand to what extent healthcare prices play a role in affecting patients’ choices. This paper estimates the effect of changes in relative healthcare prices on patients’ hospital choices by exploiting a policy that changes patients’ cost-sharing at different levels of healthcare institutions in China. Using a unique hospitalization data set from China and a Regression Discontinuity in Time (RDiT) approach, we show that patients are sensitive to relative price changes when selecting different levels of healthcare institutes. In specific, when faced with lower cost-sharing at a primary care hospital and higher cost-sharing at a high-level hospital, patients significantly increase the visits to primary care hospitals and decrease visits to high-level hospitals. These findings demonstrate the effectiveness of the policy in strengthening primary care utilization in China. Further analysis of the economic implications shows that the efficiency among tertiary hospitals improves, while the policy leads to both efficiency gains and losses in the primary care sector.

 Biography:

·I am Jiyuan Wang, and I am also happy if you just call me Jerry.

·I am currently an associate professor (tenure track) at School of Insurance and China Institute of Actuarial Science, Central University of Finance and Economics (Beijing). I am now an external affiliate of HEDG (Health Economics and Data Group) at York University.

·I earned a PhD in economics at the University of Groningen in 2020 and a PhD in Management Science at the University of Chinese Academy of Sciences in 2017. 

·I was a junior researcher at Netspar (Network for Studies on Pensions, Ageing and Retirement) from 2016 to 2020 and a lecturer at University of Groningen from 2019 to 2020.

My main research fields are Health Economics and Applied Microeconometrics. Currently I am working on several projects about  long-term effects of exposure to adverse early-life environments and household/firm health insurance decisions.