An Examination of the Determination of Medical Capacity under a National Health Insurance Program

Abstract

This paper examines the capacity determination factors of medical services at a national level through the analysis of a mathematical model that maximizes social welfare, which consists of the consumption of private goods and the medical capacity provided by the society. A sensitivity analysis is conducted to investigate the impact of these factors on the medical capacity provided. Furthermore, a case example based on the data provided by the government is presented to discuss the results derived from the theoretical analysis. The results of the sensitivity analysis indicate that individual disposable income, the medical expenditure for each treatment, the level of premium payments, and substitution parameters have a positive impact on medical capacity, while the medical costs and preference parameter negatively affect medical capacity. The results of the correlation analysis based on the data of the case example are consistent with the findings of the theoretical analysis.