Assessing the price levels of medical service and influential factors: evidence from China.

ABSTRACT

BACKGROUND: Medical service prices play a crucial role in cost containment in China. This study aimed to assess the change in medical service price levels at the macro level and the relationship with relevant macroeconomic factors. METHODS: Data from the 2022 China Statistics Yearbook, the 2022 China Health Statistics Yearbook, and the 2020 China National Health Accounts Report were used. Time trends of health price levels, utilization, and health expenditure were examined. A time-series regression model was employed to measure the impact of service utilization and medical service prices on total medical service expenditure growth from 2000 to 2021. The Johansen cointegration test was conducted to test the cointegrating relationship between medical service price levels and total medical service expenditure, average wage of employees and CPI. The Granger causality test was performed to observe the direction of causality. RESULTS: Descriptive analyses showed consistent growth in utilization and medical service price levels from 2000 to 2021. The time-series model indicated that medical service expenditure was influenced by the rise in inpatient admissions and price levels of medical service and medicine. The Johansen cointegration test identified a long-term equilibrium relationship between medical service price levels and total medical service expenditure, average wage and CPI. The change in medical service price levels was the Granger cause of the change in medical service expenditure, but it had no impact on average wage and CPI. However, the change in medical service price levels was influenced by these three macroeconomic factors. CONCLUSIONS: The growth of medical service expenditure in China was driven by inpatient use and price level. There was a long-term equilibrium relationship between medical service price levels and relevant macroeconomic factors. However, medical service price levels only affected medical service expenditure and have no impact on average wage and CPI. It is necessary to improve the value transmission mechanism of medical service prices.