An empirical analysis of a telehealth system in terms of cost-sharing

Abstract

summary We interviewed 348 users of a home telemonitoring system and asked questions about their willingness to pay (WTP). Assuming that the functional form of demand was logistic, the best estimate of the WTP was ¥4519 per user per month. We also analysed how the benefits of the system (expressed in terms of WTP) were attributed to four factors: stabilizing illness; enhancement of health consciousness; less anxiety in day-to-day life; and a decrease in medical expenditures. All except the last were significant. According to the resulting model, individual users should bear ¥2763 in costs, while society should reimburse ¥349. Surprisingly, the value of ¥2763 obtained here is very close to the amount (¥2500) actually charged by Kamaishi City.