An Unintended Complementarity: How the Outpatient Pooling Policy Increases Inpatient Services in China

Area of Science:

• Health Services Research
• Health Economics
• Public Health Policy

Background:

• China's tiered healthcare system aims to optimize resource allocation.
• Outpatient pooling reform was implemented to improve healthcare efficiency.
• Understanding the interplay between outpatient and inpatient services is crucial for policy evaluation.

Purpose of the Study:

• To investigate the impact of outpatient pooling reform on the relationship between outpatient and inpatient healthcare services in China.
• To analyze the effects of the reform on healthcare utilization and resource allocation.
• To identify mechanisms driving changes in service utilization post-reform.

Main Methods:

• Utilized a staggered difference-in-differences (DID) design.
• Employed an imputation model for data analysis.
• Sourced data from administrative healthcare records (Sichuan Province, 2010-2020) and the China Health and Retirement Longitudinal Study (CHARLS, 2011-2018).

Main Results:

• The reform led to an unexpected increase in hospital admissions, contrary to policy goals.
• Increased outpatient service utilization showed a complementary effect on inpatient care demand.
• Mechanisms included induced hospitalization from primary care expansion and efficiency gains from shifting pre-operative tests.

Conclusions:

• Outpatient and inpatient services exhibit complex interactions, not always aligning with policy intentions.
• The expansion of outpatient services can induce increased inpatient volume.
• Reforming the medical insurance payment system is essential to enhance the efficiency of China's healthcare services.