Factor decomposition of inter-prefectural health care expenditure disparities in Japan

Masayoshi Hayashi and Akiko Oyama
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Akiko Oyama: Policy Research Institute, Ministry of Finance, Japan

Discussion papers from Policy Research Institute, Ministry of Finance Japan

Abstract: Despite frequent discussions on regional variations in health care expenditure (HCE), few studies account for the sources of such regional disparities. This study bridges this gap in the body of knowledge by taking the following two steps. First, we explore the determinants of regional HCE in Japan, covering a data period that expands the scope of previous studies (i.e., the 2000s). Second, we decompose the variations in regional HCE into contributions explained by the HCE determinants examined in the first step, utilizing a regression-based decomposition method. In the regression analysis, we find that the effect of the number of hospital beds on per capita HCE is larger than that of the other determinants, except the proportion of the elderly population. In particular, a 1% increase in the number of hospital beds induces a .22?.43% increase in HCE, in line with Roemer fs Law. The decomposition analysis also finds the salient effect of the number of hospital beds. In particular, this variable accounts for a large proportion of inequality (between 37.6% and 83.9%). This finding also corroborates Roemer fs Law. Our results strongly suggest that the national policy in Japan of reducing hospital beds regionally has been an effective instrument for containing rapidly increasing HCE.

Keywords: regional health care expenditure; regression-based inequality decomposition; Japan (search for similar items in EconPapers)
JEL-codes: H51 H73 I14 I18 (search for similar items in EconPapers)
Pages: 30 pages
Date: 2014-08
New Economics Papers: this item is included in nep-hea
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Citations: View citations in EconPapers (1)

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https://warp.da.ndl.go.jp/info:ndljp/pid/11247618/ ... ion_paper/ron264.pdf First version, 2014 (application/pdf)

Related works:
Working Paper: Factor Decomposition of Inter-prefectural Health Care Expenditure Disparities in Japan (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:mof:wpaper:ron264

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