Hospital drug prescription strategy under Global Budget in Taiwan
Jing Hua Zhang (a), Shin-Yi Chou (a), Hsien-Ming. Lien (b)
(a) College of Business and Economics, Lehigh Univeristy;
(b) National Taiwan University
Abstract
This paper exams how the drug prescription behaviors by hospitals in Taiwan changes after the implementation of global budget (GB), which sets a fixed annual cap on the total expenditure of all hospitals and a floating point value for the price of medical services. Taiwan's GB allows hospitals reimburse drug expenditures at a full price before the floating point value is calculated. We use Difference In Difference (DID) model and quantile regression method to analysis the monthly drug amount prescribed by Taiwan's hospital department during1999 to 2006. The result suggests that hospital departments which heavily depend on using of drug in the treatment indeed have increased their drug prescription amount, after controlling for the time trend and other hospital characteristics. At the same time, our results suggest that the hospital departments that have low dependence on drug using in the treatment, have slightly decreased the prescription drug amount, after controlling for the time trend and other hospital characteristics.
Our result contributes to the understanding about how hospitals' drug prescription behavior and strategy change under global budget scheme.
Bio
Jing Hua Zhang is a third year doctoral student in Health Economics under the guidance of Prof. Shin-Yi Chou at Department of Economics, also working with Dr. Hsien-Ming Lien at National Taiwan University. Jing Hua Zhang's research interest focus on the hospital's management strategy in the dynamic economic environment.
