Three Essays on Health Policy and Private Health Care in China

This thesis consists of three essays on health policy and private health care inChina.Essay 1: Aligning Incentives of Physicians - An Experimental Study ofTwo-part Tariffs and Separation of Prescription and Treatment in Health CareMarkets (with Ben Greiner, Lyla Zhang)The fi rst study experimentally explores whether different provisions in themarket (the separation of agents and the separation of prices) can mitigateChina's overtreatment problem and increase market efficiency. Based on a credencegood model, this study first tests the hypothesis that doctors ·will overtreat patients when the patients are able to reject the treatment after they receivetheir diagnosis from the doctor. Then, the study looks at a separation ofagents, a separation of prices, and the interaction of both of the separations,all t hree t reatments are introduced as they can theoretically yield an honesttreatment and restore market efficiency. Separating the agents yields strongereffects on the honesty of doctors and the efficiency of treatment than separatingprices, and the market-level efficiency loss is minor due to more diagnosis andless overtreatment.Essay 2: The Preference Heterogeneity for Utilisation of Public-PrivateHealth Care in Urban ChinaIn the second paper, I evaluate the preference over health care attributesaffecting an individual's choice for the utilisation of hospital health care basedon a discrete choice experiment from a random sample of respondents in urbanChina. The results indicate a significantly negative marginal willingness-to-payfor private health care. Hukou, a typical indicator of socioeconomic background,is significantly related to the respondents' preference heterogeneity. Urban residents(urban Hukou) value private health care less, yet rural migrants (ruralHukou) are more likely to be indifferent between public and private provision.China should consider its residents' health care preferences when it attempts toexpand the private health care sector in the short term.Essay 3: The Growth of Private Hospitals and Their Health 'Workforce inChina (with Yucheng Zhang)(This paper has been published as "The growth of private hospitals and theirhealth 'WOrkforce in China: a comparison with public hospitals, Health Policyand Planning 29, pp, 30-41, 2014,")The third study investigates the outcomes of the market-opening policies forhealth care services since 2000, The longitudinal data of hospitals in China isanalysed by a segmented regression to detect the growth of private hospitals,Two panels of healthcare workers are examined to identify their mobility fromthe public to the private hospitals, The number of private hospitals has rapidlyincreased after 200L About a quarter of the physicians in private hospitals areover the age of 60. Specific features of the hospital-physician relationship inChina may account for the unbalanced age distribution that is featured amongdoctors and the mobility of the healthcare workforce in private hospitals