Do benefits in kind or refunds affect health service utilization and health outcomes? A natural experiment from Japan

The Japan Medical Association, a lobby of physicians, went on strike in July 1971 because of the medical reforms by the government. Although these physicians resigned as health insurance doctors, they continued to provide medical care and even health insurance treatment in some areas. This study uses the regional differences in resignation rates as a natural experiment to examine how the payment method of health insurance affects medical service utilization and health outcomes. Our estimation results indicate that if the participation rate of the strike increased by 1 percentage point and proxy claims were refused completely, the number of cases of insurance benefits and total amount of insurance benefits would decrease by 0.78% and 0.58%, respectively compared with the same month in the previous year. Moreover, the average amount of insurance benefits per claim increased since patients with relatively less serious diseases might have sought healthcare less often. Finally, our results suggest that the strike did not affect death rates in Japan.