Jin, Ginger Zhe. <br/><br/>
Top-up Design and Health Care Expenditure:  Evidence from Cardiac Stents / 
Ginger Zhe Jin, Hsienming Lien, Xuezhen Tao. 
 - Cambridge, Mass.  National Bureau of Economic Research  2020. 
 - 1 online resource:  illustrations (black and white); 
 - NBER working paper series  no. w28107 .
 - Working Paper Series (National Bureau of Economic Research)  no. w28107. .
<br/><br/> November 2020. 
<br/><br/> Since 2006, Taiwan's National Health Insurance (NHI) covers the full cost of baseline treatment in cardiac stents (bare-metal stents, BMS), but requires patients to pay the incremental cost of more expensive treatments (drug-eluting stents, DES). Within this "top-up" design, we study how hospitals respond to a 26% cut of the NHI reimbursement rate in 2009. We find hospitals do not raise the DES prices from patients, but increase BMS usage per admission by 18%, recouping up to 30% of the revenue loss in 2009-2010. Overall, the rate cut is effective in reducing NHI expenditure despite hospitals' moral hazard adjustment. 
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