Healthcare Study

Healthcare Study

2017, Sep 12    

This was my synthesis project done during my final year at UQAM (during my Bachelors in Economics). The goal of this project was to do synthesis of economics concepts. I decided do wprk micro economics project related to health. The dataset was provided by our professor. Here I use econometrics (statistical analysis) techniques. The report was in French, but here below I translated the conclusion-summary. In the report you can see Graphs and diagrams that can give you an idea of the whole analysis.

Summary-Conclusion from the Study:

To begin with, the reform introduced in Germany in mid-1997 did have an effect on the number of visits to the doctor. Although the effect is not “revolutionary”, it is statistically significant (in the short term). The effect of the reform is most noticeable in 1998, since this is the only time the reform was present in the entire year. However, the effect is still visible in 1999, which tells us that people have probably become accustomed to visiting the doctor less. As shown in Table 1 of our descriptive statistics, we go from an average of 2.66 for 1996 to 2.35 for 1998. Furthermore, by running multiple regressions, we come to the conclusion that the impact of the reform on the population varies on average by -0.25 in our model including all our control variables, for the year 1998. This figure decreases to -017 in our fixed-effects model, and in our opinion this is the most plausible figure. This represents 1/13 of the average number of visits to the doctor for all years combined, i.e. 8% less. These effects appear to be small-scale, but as we have seen, they are statistically significant. What’s more, the reform has been applied to many other healthcare sectors, which means that the effect of co-payments at the doctor’s surgery must be added to other effects on the healthcare system, which we have not analyzed here. So, co-payments are a way of helping to reduce healthcare system costs. It would be interesting to see the magnitude of the effect in concrete dollars, but that’s beyond the scope of our analysis. We also note that the reform reduced moral hazard, as people changed their behavior when co-payments were introduced (except for the chronically and severely ill). This is an important point, because it tells us that co-payments have reduced unnecessary visits to the doctor. It also suggests that the government should make the population aware of the need to visit the doctor responsibly. The reform seems to have had less impact on people with serious or chronic illnesses. In fact, this is the conclusion reached by Winkelmann and other authors in our literature review, due to their inelastic demand. Table 2 in our descriptive statistics testifies to this, although here we’re only talking about the individual’s perception of health, we have in fact omitted variables relating to health. It would be important to take these people into account during a reform, as a reduction in visits to the doctor on their part could exacerbate their condition, given that in their case the doctor is a basic need. Finally, we also analyzed the different groups we saw in the descriptive statistics. We can see that, even though women go to the doctor more than men on average, the reform has had almost the same effect on both sexes. As for the groups with different levels of education, the effect of the reform seems to be the same for all of them too. The effect of the reform seems to be relatively great when compared with employed people, but this seems to be due to a trend that was there a priori. Finally, we believe that the reform of co-payments could have a positive effect on Quebec, as it would reduce the moral hazard. However, given the differences between Germany and Quebec, we would need to introduce a co-payment system that is appropriate for the population and that does not punish the most disadvantaged (the unemployed).

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