Elsevier

Social Science & Medicine

Volume 68, Issue 8, April 2009, Pages 1432-1438
Social Science & Medicine

Do consultation charges deter general practitioner use among older people? A natural experiment

https://doi.org/10.1016/j.socscimed.2009.02.014Get rights and content

Abstract

In the Republic of Ireland, approximately 30% of the population (‘medical card patients’) are entitled to free general practice services. Eligibility is determined primarily on the basis of an income means test. The remaining 70% of the population (‘private patients’) must pay the full cost of all general practitioner (GP) consultations. From July 2001, all those over 70 years of age are also entitled to a medical card, regardless of income. This change in the pricing of GP services in the Republic of Ireland in 2001 provides a natural experiment that allows for an examination of the influence of economic incentives on GP visiting behaviour. The purpose of this paper is to examine whether this change in pricing for GP care for those over 70 years of age in Ireland led to an increase in the utilisation of GP services among this group. Using data from two nationally representative surveys of the population over the age of 65 before and after the policy change, difference-in-difference two-step models of GP visiting behaviour are estimated. The results indicate that, while there is some limited evidence in favour of an increase in the probability of seeking GP care among those over 70 years of age after the policy change, there is no significant effect on the frequency of visits. Differences in the incentives facing both patients and GPs after the policy change can explain the latter result.

Introduction

Equity of access to health care is regarded as a key element of health system performance by the OECD (Hurst & Jee-Hughes, 2001). Research on equity in the provision of general practitioner (GP) services has largely concentrated on the total adult population and there has been little research on the pattern of GP utilisation and levels of equity among older age groups. Older age is associated with a higher likelihood of visiting a GP and a higher frequency of service use (Layte, Nolan, Nolan, & van Ourti, 2005), yet older people may face greater barriers to utilisation. Decreased mobility, poorer access to transport and information and lower income in retirement may all influence patterns of utilisation among older people. Such barriers are unlikely to be evenly distributed across older people; for example, it is likely that wealthier older people may, paradoxically, have both better health status and greater access to services. In addition, access to primary care can reduce reliance on more costly secondary care services, a particularly important issue for the older population who are heavy users of such services. The influence of consultation charges on GP utilisation behaviour among the older population is thus of particular research interest.

The Republic of Ireland provides a valuable test case of the influence of charging on the utilisation of GP services because of a recent change in pricing policy which affected only part of the population and thereby allows us to assess the impact of financial incentives on GP utilisation. The Republic of Ireland is distinctive among OECD countries in the pricing of GP services. Currently, 29% of the population (‘medical card patients’) qualify for free primary care via an income means test, through particular health needs, or participation in an approved government training and employment scheme (Primary Care Reimbursement Service, 2007). The remaining 71% of the population (‘private patients’) must pay in full for all primary care services, and for all prescription medicines up to a monthly threshold. From July 1st 2001, all individuals aged 70 years and over are also entitled to a medical card, regardless of income. The proportion of medical card patients among those aged 65 or more increased from 65% to 85% between 2000 and 2004.

GPs in the Republic of Ireland are independent professionals, although the majority enter into contract with the state to provide services to medical card patients, for which they receive a capitation fee. GPs charge a fee-for-service for private patients, with the average cost of a GP consultation estimated at €33 in 2003 (Indecon Economic Consultants, 2003). In October 2005, the government introduced a ‘GP only’ medical card (i.e., with no cover for prescription medicine costs but with income thresholds 50% higher than for the standard medical card), in part in response to concerns over the situation of private patients just above the income threshold for a medical card. This added a further 1% of the population to the total eligible under what is termed the ‘medical card’ scheme (Primary Care Reimbursement Service, 2007). In contrast to cover for primary care services, all individuals, regardless of income or age, are entitled to free public hospital services. However, over half the population purchases private health insurance, which primarily provides cover for private hospital services (some of which may be provided in public hospitals). Medical card patients may take out private health insurance if they wish, although the numbers doing so are very small; in 2001, only 2.1% of the population had both a medical card and private health insurance (Nolan & Nolan, 2008). GPs act as gatekeepers for secondary care services in Ireland, so GPs and specialists are not substitutes as in many other health care systems. In addition, the financial incentive to substitute A & E visits for GP visits is limited by substantially greater charges for A & E visits for private patients, as well as long waiting times (see also Nolan, 2007b).

An extensive international literature has analysed the impact of charges on the utilisation of health services, and has confirmed that higher charges are associated with lower levels of health services utilisation. One of the most extensive studies of the impact of charging on the utilisation of health services is the RAND Health Insurance Experiment (HIE), which lasted from 1972 until 1981. Individuals were randomly assigned to a number of different insurance plans, which differed in the degree of cost sharing involved. The study assessed the impact of these charges on health services utilisation, health status and patient satisfaction. The study found that the larger the degree of cost sharing, the larger the reduction in use (see Keeler, 1992). More recent studies have attempted to identify a moral hazard effect of insurance on the utilisation of various health services, and to distinguish this effect from the possibility that those with insurance are likely to be in poorer health than those without (see Buchmueller et al., 2002, Cameron et al., 1988, Chiappori et al., 1998, Harmon and Nolan, 2001, Holly et al., 1998; Hurd and McGarry, 1997, Jones et al., 2002, Schellhorn, 2001, Vera-Hernandez, 1999, Waters, 1999). Studies that examine explicitly the health services utilisation behaviour of older individuals are less common. However, research does suggest that there exists inequity in utilisation among the older population in favour of wealthier and better educated individuals (Allin et al., 2006, Hakkinen and Luoma, 1995, Nelson et al., 2002).

Previous research in Ireland has found a significant difference in GP visiting behaviour between medical card and private patients. Medical card patients have a higher probability of attending their GP in the last year, and a higher number of GP visits per annum (see Madden et al., 2005, Nolan, 1991, Nolan, 1993, Nolan, 2007a, Nolan, 2008, Nolan and Nolan, 2008, Tussing, 1983, Tussing, 1985). Much of this higher level of utilisation among medical card patients could be explained by the poorer health profile of the medical card population, but neither poorer health status nor other need factors such as age could fully explain the higher level of utilisation. It was suggested that the lower level of utilisation among private patients results from the price disincentive that they face. A recent study carried out among patients in GP practices in both Northern Ireland and the Republic of Ireland found that 26% of private patients in the Republic with a medical problem in the last year had not visited their GP because of cost. The probability of non-consultation was higher in the middle of the income distribution which lies above the medical card threshold (O'Reilly et al., 2007a). Using longitudinal data to follow the same individuals through time, Nolan (2007a) found that those who gain a medical card significantly increase their level of GP visiting, even after controlling for other changes in characteristics such as health status. Given this evidence, the introduction of the medical card for all those over the age of 70 may be expected to increase utilisation among those newly eligible for a medical card after 2001.

However, the Irish situation is complicated further by the differential in payment types to GPs for medical card and private patients. While GPs receive a capitation fee for medical card patients, they receive a fee-for-service from private patients. The distinction affects the incentives GPs face with regard to the treatment of both groups, with fee-for-service reimbursement creating incentives for demand inducement on the part of GPs (in terms of return visits, ordering ancillary services etc.). However, a recent study of GP visiting behaviour in Ireland as a result of a change in payment method for GPs in 1989 found little evidence in favour of demand inducement on the part of Irish GPs (see Madden et al., 2005). Nonetheless, the extension of medical card eligibility to all those over 70 years in 2001 changed the incentives faced by both patients and GPs, although it is difficult to distinguish the two effects. While those over 70 years of age now face a clear incentive to increase both the probability and frequency of GP visits, the fact that GPs are now reimbursed on a capitation basis for these patients may mean that GP visiting (and particularly the frequency of GP visiting which would be more amenable to GP advice) may decline among this group.

In this paper we use data from two nationally representative surveys of older Irish people carried out before and after the change in policy (2000 and 2004) to examine whether the introduction of free GP care for those aged over 70 in Ireland led to an increase in both the overall probability of seeking care and the frequency of visiting. A natural experiment has been defined as “a situation where the forces of nature or government policy have conspired to produce an environment somewhat akin to a randomised experiment” (Angrist & Krueger, 2001). The expansion of the medical card scheme in Ireland in 2001 is a good example of a natural experiment that can be used to examine the impact of moving from a system of paid to freely available GP care. Because medical cards became available to all those aged over 70, the change introduced an exogenous source of variation between two points in time that can be used to determine the ‘treatment effect’ of moving from fee-based to free GP care. Given the change in incentives also faced by GPs, and the principal-agent nature of the relationship between GP and patient, we expect that while the effect on the probability of seeking GP care among those over 70 after the policy change will be positive, the effect on the frequency of GP visiting may be more ambiguous. The following section introduces the data used in this analysis, while the ‘methods’ section explains our modelling approach. Empirical results are then presented and discussed, while the final section summarises and concludes.

Section snippets

Data

The first Health and Social Services for Older People survey (HeSSOP 1) was carried out in 2000 with the aim of providing representative data on the health and health and social service use of Irish people aged 65 or more in private households in the Western Health Board (WHB) and Eastern Region Health Authority (ERHA) areas of the country. Approximately one third of the population of the Republic of Ireland lived in the areas covered by the ERHA and WHB and the two health boards were chosen

Methods

This paper aims to quantify the effect of extending the medical card scheme in the Republic of Ireland to all those aged 70 or more in 2001. Previous research has shown that individuals in receipt of a medical card have higher levels of GP visiting than private patients who pay the full market rate. This is true even controlling for the distribution of factors such as age, gender, health status and location that influence utilisation rates and which vary between medical card and private

Empirical results

Table 4, Table 5 present the results from the two-step (probit and truncated negative binomial) models of GP visiting. Looking first at the results from the probit model of the probability of visiting a GP, column (1) in Table 4 presents the difference-in-difference estimates from a simple model with no additional independent variables, only age, year and age–year interactions. The results, which are consistent with the aggregate patterns presented in Table 3, show that the probability of

Summary and conclusions

Equity of access to health care is regarded as a key principal of health system performance, with access to GP services particularly important in terms of reducing reliance on (more costly) secondary care services and improving overall health status. However, previous research, both international and Irish, has tended to concentrate on the total adult population, with little examination of the situation of older individuals, for which access to good quality primary care may be particularly

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    We thank other Healthy Aging Research Programme (HARP) staff and Steering Group members who contributed in this overall research programme: Ms. Rebecca Garavan, Ms Maja Barker, Dr Anne Hickey, Dr Ronan Conroy, Dr. Frances Horgan, Ms Karen Morgan, Dr. Emer Shelley (at RCSI); Ms. Claire Donnellan, Dr. David Hevey & Professor Desmond O'Neill (at TCD); Dr. Vivienne Crawford, Mr John Dinsmore and Professor Bob Stout (at QUB). We thank Professor James Williams (ESRI) and Dr. Donal McDade (Social and Market Research) for coordinating community interviews in the Republic and Northern Ireland respectively. We also sincerely thank research participants for their time and cooperation.

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