IDEAS home Printed from https://ideas.repec.org/a/wly/hlthec/v16y2007i10p1051-1068.html
   My bibliography  Save this article

Demand assessment and price‐elasticity estimation of quality‐improved primary health care in palestine: a contribution from the contingent valuation method

Author

Listed:
  • Awad Mataria
  • Stéphane Luchini
  • Yousef Daoud
  • Jean‐Paul Moatti

Abstract

This paper proposes a new methodology to assess demand and price‐elasticity for health care, based on patients' stated willingness to pay (WTP) values for certain aspects of health care quality improvements. A conceptual analysis of how respondents consider contingent valuation (CV) questions allowed us to specify a probability density function of stated WTP values, and consequently, to model a demand function for quality‐improved health care, using a parametric survival approach. The model was empirically estimated using a CV study intended to assess patients' values for improving the quality of primary health care (PHC) services in Palestine. A random sample of 499 individuals was interviewed following medical consultation in four PHC centers. Quality was assessed using a multi‐attribute approach; and respondents valued seven specific quality improvements using a decomposed valuation scenario and a payment card elicitation technique. Our results suggest an inelastic demand at low user fees levels, and when the price‐increase is accompanied with substantial quality‐improvements. Nevertheless, demand becomes more and more elastic if user fees continue to rise. On the other hand, patients' reactions to price‐increase turn out to depend on their level of income. Our results can be used to design successful health care financing strategies that include a consideration of patients' preferences and financial capacities. Copyright © 2007 John Wiley & Sons, Ltd.

Suggested Citation

  • Awad Mataria & Stéphane Luchini & Yousef Daoud & Jean‐Paul Moatti, 2007. "Demand assessment and price‐elasticity estimation of quality‐improved primary health care in palestine: a contribution from the contingent valuation method," Health Economics, John Wiley & Sons, Ltd., vol. 16(10), pages 1051-1068, October.
    • Handle: RePEc:wly:hlthec:v:16:y:2007:i:10:p:1051-1068
    DOI: 10.1002/hec.1216
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/hec.1216
    Download Restriction: no
    File URL: https://libkey.io/10.1002/hec.1216?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Onwujekwe, Obinna & Hanson, Kara & Fox-Rushby, Julia, 2005. "Do divergences between stated and actual willingness to pay signify the existence of bias in contingent valuation surveys?," Social Science & Medicine, Elsevier, vol. 60(3), pages 525-536, February.
    2. Ryan, Mandy & Scott, David A. & Donaldson, Cam, 2004. "Valuing health care using willingness to pay: a comparison of the payment card and dichotomous choice methods," Journal of Health Economics, Elsevier, vol. 23(2), pages 237-258, March.
    3. Stewart, Jennifer M. & O'Shea, Eamon & Donaldson, Cam & Shackley, Phil, 2002. "Do ordering effects matter in willingness-to-pay studies of health care?," Journal of Health Economics, Elsevier, vol. 21(4), pages 585-599, July.
    4. Foreit, James R. & Foreit, Karen G. Fleischman, 2003. "The reliability and validity of willingness to pay surveys for reproductive health pricing decisions in developing countries," Health Policy, Elsevier, vol. 63(1), pages 37-47, January.
    5. Cummings, Ronald G & Harrison, Glenn W & Rutstrom, E Elisabet, 1995. "Homegrown Values and Hypothetical Surveys: Is the Dichotomous Choice Approach Incentive-Compatible?," American Economic Review, American Economic Association, vol. 85(1), pages 260-266, March.
    6. Chernichovsky, Dov & Meesook, Oey Astra, 1986. "Utilization of health services in Indonesia," Social Science & Medicine, Elsevier, vol. 23(6), pages 611-620, January.
    7. Bernie O'Brien & Amiram Gafni, 1996. "When Do the "Dollars" Make Sense?," Medical Decision Making, , vol. 16(3), pages 288-299, August.
    8. Gyldmark, Marlene & Morrison, Gwendolyn C., 2001. "Demand for health care in Denmark: results of a national sample survey using contingent valuation," Social Science & Medicine, Elsevier, vol. 53(8), pages 1023-1036, October.
    9. Litvack, Jennie I. & Bodart, Claude, 1993. "User fees plus quality equals improved access to health care: Results of a field experiment in Cameroon," Social Science & Medicine, Elsevier, vol. 37(3), pages 369-383, August.
    10. Johannesson, Magnus & Jonsson, Bengt, 1991. "Economic evaluation in health care: Is there a role for cost-benefit analysis?," Health Policy, Elsevier, vol. 17(1), pages 1-23, February.
    11. Klose, Thomas, 1999. "The contingent valuation method in health care," Health Policy, Elsevier, vol. 47(2), pages 97-123, May.
    12. Mataria, Awad & Donaldson, Cam & Luchini, Stephane & Moatti, Jean-Paul, 2004. "A stated preference approach to assessing health care-quality improvements in Palestine: from theoretical validity to policy implications," Journal of Health Economics, Elsevier, vol. 23(6), pages 1285-1311, November.
    13. Onwujekwe, Obinna & Chima, Reginald & Shu, Elvis & Nwagbo, Douglas & Akpala, Cyril & Okonkwo, Paul, 2002. "Altruistic willingness to pay in community-based sales of insecticide-treated nets exists in Nigeria," Social Science & Medicine, Elsevier, vol. 54(4), pages 519-527, February.
    14. Peter Kennedy, 2003. "A Guide to Econometrics, 5th Edition," MIT Press Books, The MIT Press, edition 5, volume 1, number 026261183x, April.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Andriy Danyliv & Milena Pavlova & Irena Gryga & Wim Groot, 2015. "Preferences for physician services in Ukraine: a discrete choice experiment," International Journal of Health Planning and Management, Wiley Blackwell, vol. 30(4), pages 346-365, October.
    2. Danyliv, Andriy & Groot, Wim & Gryga, Irena & Pavlova, Milena, 2014. "Willingness and ability to pay for physician services in six Central and Eastern European countries," Health Policy, Elsevier, vol. 117(1), pages 72-82.
    3. Pierre-Alexandre Mahieu & Romain Craste & Bengt Kriström & Pere Riera, 2014. "Non-market valuation in France: An overview of the research activity," Working Papers hal-01087365, HAL.
    4. Francisco Rosas & Santiago Acerenza & Peter F. Orazem, 2020. "Optimal pricing strategies for a cluster of goods: own- and cross-price effects with correlated tastes," Applied Economics, Taylor & Francis Journals, vol. 52(7), pages 742-755, February.
    5. Fosgerau, Mogens & Karlström, Anders, 2010. "The value of reliability," Transportation Research Part B: Methodological, Elsevier, vol. 44(1), pages 38-49, January.
    6. Fooks, Jacob R. & Messer, Kent D. & Duke, Joshua M. & Johnson, Janet B. & Parsons, George R., 2017. "Continuous attribute values in a simulation environment: Offshore energy production and Mid-Atlantic beach visitation," Energy Policy, Elsevier, vol. 110(C), pages 288-302.
    7. Chakravarty, Amiya K. & Werner, Adrian S., 2011. "Telecom service provider portal: Revenue sharing and outsourcing," European Journal of Operational Research, Elsevier, vol. 215(1), pages 289-300, November.
    8. Tambor, Marzena & Pavlova, Milena & Rechel, Bernd & Golinowska, Stanisława & Sowada, Christoph & Groot, Wim, 2014. "Willingness to pay for publicly financed health care services in Central and Eastern Europe: Evidence from six countries based on a contingent valuation method," Social Science & Medicine, Elsevier, vol. 116(C), pages 193-201.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Awad Mataria & Stéphane Luchini & Yousef Daoud & Jean-Paul Moatti, 2007. "Demand assessment and price-elasticity estimation of quality-improved primary health care in palestine: a contribution from the contingent valuation method," Health Economics, John Wiley & Sons, Ltd., vol. 16(10), pages 1051-1068.
    2. Mataria, Awad & Donaldson, Cam & Luchini, Stephane & Moatti, Jean-Paul, 2004. "A stated preference approach to assessing health care-quality improvements in Palestine: from theoretical validity to policy implications," Journal of Health Economics, Elsevier, vol. 23(6), pages 1285-1311, November.
    3. David Whynes & Emma Frew & Jane Wolstenholme, 2005. "Willingness-to-Pay and Demand Curves: A Comparison of Results Obtained Using Different Elicitation Formats," International Journal of Health Economics and Management, Springer, vol. 5(4), pages 369-386, December.
    4. Alene Sze Jing Yong & Yi Heng Lim & Mark Wing Loong Cheong & Ednin Hamzah & Siew Li Teoh, 2022. "Willingness-to-pay for cancer treatment and outcome: a systematic review," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 23(6), pages 1037-1057, August.
    5. Shono, Aiko & Kondo, Masahide & Ohmae, Hiroshi & Okubo, Ichiro, 2014. "Willingness to pay for public health services in rural Central Java, Indonesia: Methodological considerations when using the contingent valuation method," Social Science & Medicine, Elsevier, vol. 110(C), pages 31-40.
    6. Mandy Ryan & Mabelle Amaya‐Amaya, 2005. "‘Threats’ to and hopes for estimating benefits," Health Economics, John Wiley & Sons, Ltd., vol. 14(6), pages 609-619, June.
    7. Obinna Onwujekwe & Benjamin Uzochukwu, 2004. "Stated and actual altruistic willingness to pay for insecticide‐treated nets in Nigeria: validity of open‐ended and binary with follow‐up questions," Health Economics, John Wiley & Sons, Ltd., vol. 13(5), pages 477-492, May.
    8. Mataria, Awad & Giacaman, Rita & Khatib, Rana & Moatti, Jean-Paul, 2006. "Impoverishment and patients' "willingness" and "ability" to pay for improving the quality of health care in Palestine: An assessment using the contingent valuation method," Health Policy, Elsevier, vol. 75(3), pages 312-328, February.
    9. Raymond Y. T. Yeung & Richard D. Smith & Lai‐Ming Ho & Janice M. Johnston & Gabriel M. Leung, 2006. "Empirical implications of response acquiescence in discrete‐choice contingent valuation," Health Economics, John Wiley & Sons, Ltd., vol. 15(10), pages 1077-1089, October.
    10. Kangethe, Anne & Franic, Duska M. & Corso, Phaedra S., 2016. "Comparing the validity of the payment card and structured haggling willingness to pay methods: The case of a diabetes prevention program in rural Kenya," Social Science & Medicine, Elsevier, vol. 169(C), pages 86-96.
    11. Dror, David Mark & Radermacher, Ralf & Koren, Ruth, 2007. "Willingness to pay for health insurance among rural and poor persons: Field evidence from seven micro health insurance units in India," Health Policy, Elsevier, vol. 82(1), pages 12-27, June.
    12. Eamon O’Shea & Jennifer Stewart & Cam Donaldson & Phil Shackley, 2001. "Eliciting Preferences for Resource Allocation in Health Care," The Economic and Social Review, Economic and Social Studies, vol. 32(3), pages 217-238.
    13. Sofía Garrido & Emilio Gutiérrez, 2019. "Time goes by so slowly (for those who wait): a field experiment in health care," Latin American Economic Review, Springer;Centro de Investigaciòn y Docencia Económica (CIDE), vol. 28(1), pages 1-17, December.
    14. van Exel, N.J.A. & Brouwer, W.B.F. & van den Berg, B. & Koopmanschap, M.A., 2006. "With a little help from an anchor: Discussion and evidence of anchoring effects in contingent valuation," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 35(5), pages 836-853, October.
    15. Rodríguez, Elsa Mirta M. & Lacaze, María Victoria & Lupín, Beatriz, 2007. "Willingness to pay for organic food in Argentina: evidence from a consumer survey," Nülan. Deposited Documents 1300, Universidad Nacional de Mar del Plata, Facultad de Ciencias Económicas y Sociales, Centro de Documentación.
    16. Xiao-Hua Ying & Teh-Wei Hu & Jane Ren & Wen Chen & Ke Xu & Jin-Hui Huang, 2007. "Demand for private health insurance in Chinese urban areas," Health Economics, John Wiley & Sons, Ltd., vol. 16(10), pages 1041-1050.
    17. Powdthavee, Nattavudh & van den Berg, Bernard, 2011. "Putting different price tags on the same health condition: Re-evaluating the well-being valuation approach," Journal of Health Economics, Elsevier, vol. 30(5), pages 1032-1043.
    18. Laura J. Damschroder & Peter A. Ubel & Jason Riis & Dylan M. Smith, 2007. "An alternative approach for eliciting willingness-to-pay: A randomized Internet trial," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 2, pages 96-106, April.
    19. Olsen, Jan Abel & Donaldson, Cam & Shackley, Phil, 2005. "Implicit versus explicit ranking: On inferring ordinal preferences for health care programmes based on differences in willingness-to-pay," Journal of Health Economics, Elsevier, vol. 24(5), pages 990-996, September.
    20. Denise Bijlenga & Gouke J. Bonsel & Erwin Birnie, 2011. "Eliciting willingness to pay in obstetrics: comparing a direct and an indirect valuation method for complex health outcomes," Health Economics, John Wiley & Sons, Ltd., vol. 20(11), pages 1392-1406, November.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:hlthec:v:16:y:2007:i:10:p:1051-1068. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/5749 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.