Determinants of willingness to pay for health services: a systematic review of contingent valuation studies

The European Journal of Health Economics - Stated preference studies are a valuable tool to elicit respondents’ willingness to pay (WTP) for goods or services, especially in situations where...     

Eliciting several willingness to pay in a single contingent valuation survey: application to health care

The usual implementation of contingent valuation (CV), in the context of priorities setting for allocation of public funds in health care, is to develop as many surveys as there are programmes, i.e. to perform separate evaluations (SE). In the EuroWill project, three health programmes (for heart disease, breast cancer and a service of helicopter ambulance) were however simultaneously evaluated, i.e. a joint evaluation (JE) was performed. The paper examines the issue of the econometric techniques that should be used to estimate WTP values obtained in the context of JE by comparing the application of independent OLS regressions for each programme versus simultaneous estimations using seemingly unrelated regressions (SUR) on data of the French EuroWill survey. It shows that separate estimations may lead to misspecifications because they cannot take into account that JE exogenously provides a reference structure to the respondent which affects the estimates of WTP for each programme. Therefore, the potential advantage of JE versus SE as an elicitation technique in CV studies applied to health care (to better control the referents used by respondents for evaluating different programmes) only holds if simultaneous rather than independent techniques are used in the estimation of WTPs.     

Differences between willingness to pay and willingness to accept for visits by a family physician: A contingent valuation study

Background  

The economic value attributed by users of health services in public health systems can be useful in planning and evaluation. This value can differ from the perspectives of Willingness to Pay (WTP) and Willingness to Accept [Compensation] (WTA).     

The economic value of informal care: a study of informal caregivers' and patients' willingness to pay and willingness to accept for informal care

We provide a new test of the feasibility of using contingent valuation to value informal care. We start with a theoretical model of informal caregiving and derive that willingness to pay depends positively on wealth and negatively on own health, whereas the effect of other's health is sign-ambiguous. These predictions are tested in two new data sets on patients' and caregivers' willingness to pay (WTP) and willingness to accept (WTA) for informal care. The data are generally consistent with the theoretical predictions: wealth generally has a positive impact and own health a negative impact. Other's health has a mixed effect. We find only small differences between WTP and WTA. Our findings suggest that contingent valuation may be a useful technique to value informal care in economic evaluations of health care.     

Mother's willingness to pay for her own and her child's health: a contingent valuation study in Taiwan

We use the contingent valuation (CV) method to estimate mothers' willingness to pay (WTP) to protect themselves and their children from suffering a minor illness-a cold-in Taiwan. WTP is specified as a hedonic function of the duration and severity of the cold (measured alternatively by symptoms experienced and the Quality of Well-Being (QWB) index) and of respondents' socioeconomic characteristics. The average mother is willing to pay more to protect her child than herself from suffering a cold. Median WTP to avoid the average mother's and child's colds are US$37 and US$57, respectively. Adjusting for the greater duration and severity of the average mother's cold suggests that WTP to prevent comparable illnesses is approximately twice as large for the child as for the mother. We also find that mother's WTP is about 20% greater to prevent a son's than a daughter's illness.     

Decision makers' and scientists' opinion about contingent valuation and choice experiments for measuring willingness to pay in health care: results from a survey in Germany

OBJECTIVES: Assessment of willingness to pay (WTP) by contingent valuation (CV) and choice experiments (CE) is increasingly performed in economic evaluation of health care. However, the question of whether the methods for measuring WTP are acceptable to decision makers and scientists has remained largely unacknowledged. The aim of this study was to learn more about decision makers' and scientists' opinion concerning these methods. METHODS: An expert group developed a questionnaire consisting of key items that may influence the opinion about CV and CE according to the constructs "attitude toward behavior," "subjective norm," and "behavioral intention" as defined by the Theory of Reasoned Action by Ajzen and Fishbein. In a survey, seventy-seven decision makers representing key institutions in the German healthcare system and forty-two scientists in health economics completed the questionnaire. RESULTS: Scientists and decision makers in particular did not show a high intention to use methods for measuring WTP. Skepticism regarding precision of the methods and subjects' capability to imagine paying an amount of money for a certain health commodity were stated along with the assertion that the hypothetical decision-making scenario was rather a distant reality. Nevertheless, the majority of scientists and decision makers did not state rejection of the methods. CONCLUSIONS: Increasing the probability of using methods for measuring WTP in health care, the hypothetical scenarios should be made more realistic and payment vehicles should be used to help patients relate payment to a real health benefit. Moreover, an intensive discussion on the potential usefulness of CV/CE without excluding ethical concerns in comparison to existing alternatives has to be resumed.     

Economic valuation of informal care: the contingent valuation method applied to informal caregiving

This paper reports the results of the application of the contingent valuation method (CVM) to determine a monetary value of informal care. We discuss the current practice in valuing informal care and a theoretical model of the costs and benefits related to the provision of informal care. In addition, we developed a survey in which informal caregivers' willingness to accept (WTA) to provide an additional hour of informal care was elicited. This method is better than normally recommended valuation methods able to capture the heterogeneity and dynamics of informal care.Data were obtained from postal surveys. A total of 153 informal caregivers and 149 care recipients with rheumatoid arthritis returned a completed survey. Informal caregivers reported a mean WTA to provide a hypothetical additional hour of informal care of 9.52 Euro (n=124). Many hypotheses derived from the theoretical model and the literature were supported by the data.CVM is a promising alternative for existing methods like the opportunity cost method and the proxy good method to determine a monetary value of informal care that can be incorporated in the numerator of any economic evaluation.     

Willingness to pay for drug abuse treatment: results from a contingent valuation study in Taiwan

OBJECTIVE: In this study, we attempted to describe and justify the use of a contingent valuation (CV) method to elicit the willingness to pay (WTP) for a drug abuse treatment program by the general public in Taiwan. METHOD: In total, 1817 CV survey questionnaires were conducted through telephone interviews from randomly dialed numbers. Subjects were members of the general public aged between 20 and 65 years, with full-time jobs, and residing in the three major Taiwanese cities of Taipei, Taichung, and Kaohsiung. Respondents' WTP for drug treatment programs was elicited for two different financing mechanisms: payment through 'compulsory' payroll tax/health insurance premiums, and through 'voluntary' donations. The WTP was modeled as a function of scenarios and policies of the treatment program, respondents' socio-demographic information, and their responses to knowledge and attitudes questions. RESULTS: The general public in Taiwan was estimated to be willing to pay between NT$81.00 and NT$95.00 per month for a drug abuse treatment program, while the benefits of drug abuse treatment were estimated to range between NT$12.8 billion and NT$15.0 billion in 2004 (US$1=NT$31.9 in 2004), which was equal to around 0.15% of Taiwan's GDP for that year. The general public in Taiwan was more willing to pay for drug abuse treatment via increases in NHI premiums than via donations. Preferences for the drug abuse treatment program were also found to be sensitive to the target treated population as well as the sequence in which the WTP questions were asked. CONCLUSIONS: Results of this study provide policymakers with important evidence on the monetary value of a substance abuse treatment program, allocation of healthcare resources, and a possible financing mechanism of the treatment program, which may be justified by knowledge of the WTP of the general public. This study has also advanced the knowledge of the methodological issues with regard to CV questionnaire design, and it provides a base case for further studies on drug abuse in Taiwan.     

Willingness to pay for social health insurance among informal sector workers in Wuhan, China: a contingent valuation study

Background

Most of the about 140 million informal sector workers in urban China do not have health insurance. A 1998 central government policy leaves it to the discretion of municipal governments to offer informal sector workers in cities voluntary participation in a social health insurance for formal sector workers, the so-called 'basic health insurance'(BHI)

Methods

We used the contingent valuation method to assess the maximum willingness to pay (WTP) for BHI among informal sector workers, including unregistered rural-to-urban migrants, in Wuhan City, China. We selected respondents in a two-stage self-weighted cluster sampling scheme

Results

On average, informal sector workers were willing to pay substantial amounts for BHI (30 Renminbi (RMB), 95% confidence interval (CI) 27-33) as well as substantial proportions of their incomes (4.6%, 95% CI 4.1-5.1%). Average WTP increased significantly when any one of the copayments of the BHI was removed in the valuation: to 51 RMB (95% CI 46-56) without reimbursement ceiling; to 43 RMB (95% CI 37-49) without deductible; and to 47 RMB (95% CI 40-54) without coinsurance. WTP was higher than estimates of the cost of BHI based on past health expenditure or on premium contributions of formal sector workers. Predicted coverage with BHI declined steeply with the premium contribution at low contribution levels When we applied equity weighting in the aggregation of individual WTP values in order to adjust for inequity in the distribution of income, mean WTP for BHI increased with inequality aversion over a plausible range of the aversion parameter. Holding other factors constant in multiple regression analysis, for a 1% increase in income WTP for BHI with different copayments increased by 0.434-0.499% (all p < 0.0001), and for a 1% increase in past health care expenditure WTP increased by 0.076-0.148% (all p < 0.0004). Being male, a migrant, or without permanent employment significantly decreased WTP for BHI. Education was not a significant determinant of WTP for BHI

Conclusion

Our results suggest that Chinese municipal governments should allow informal sector workers to participate in the BHI. From a normative perspective, BHI for informal sector workers is likely to increase social welfare because average WTP for BHI is significantly higher than estimates of the average cost of BHI. We further find that informal sector workers do not value the BHI as a mechanism to recover the relatively frequent but small financial losses associated with common illnesses, but because it protects against the rare but large financial losses associated with catastrophic care. From a behavioural perspective, our results predict that at a price equal to the average premium contribution of formal sector workers 35% of informal sector workers will enrol in the BHI. Subsidies and changes in insurance attributes (e.g. including catastrophic care and portability) should be effective in increasing BHI coverage. In addition, coverage should expand with rising incomes among informal sector workers in China. Finally, adverse selection will be unlikely to be a large problem, if the BHI is offered to informal sector workers.     

Willingness to pay for avoiding coronary restenosis and repeat revascularization: results from a contingent valuation study

BACKGROUND: Despite technological improvements, percutaneous coronary intervention (PCI) remains limited by restenosis requiring further revascularization procedures during the ensuing year. New technologies aiming to reduce restenosis are expensive and may increase net healthcare costs. Economic evaluations of such therapies have been performed, but have been hindered by the need to assess the disutility of short-term health care events and repeat coronary revascularization as well as the lack of benchmark standards for intermediate health outcomes. The contingent valuation approach may offer particular advantages when evaluating treatments that improve short-term health outcomes. OBJECTIVE: To examine patients' willingness to pay (WTP) for treatments that may reduce the risk of restenosis and repeat revascularization after PCI. METHODS: We used a contingent valuation approach to evaluate WTP among participants in two large clinical trials evaluating new PCI devices. The baseline scenario described a 30% probability of repeat revascularization following the initial procedure. Patients were asked to indicate, using a close-ended (referendum) question, their out of pocket WTP for an improved treatment that would reduce this risk. Three different prices (500 dollars, 1000 dollars, and 1500 dollars) and three levels of absolute risk reduction (10, 20, and 30%) were randomly varied creating nine sub-samples of patients. Patients' responses were analyzed using both parametric and non-parametric methods. RESULTS: 1642 patients completed the WTP question. The WTP medians for the 10 and 20% risk reductions were 273 dollars and 366 dollars, respectively; the median WTP for the 30% risk reduction was significantly higher at 1162 dollars (P<0.001). Higher household income (OR=1.57, P<0.001) was independently associated with a higher WTP. CONCLUSIONS: Although short-lived, avoidance of coronary restenosis may have considerable value to patients undergoing percutaneous coronary interventions. These findings may have important implications for emerging technologies such as drug-eluting stents.     

Willingness to pay and the sensitivity of willingness to pay for interdisciplinary musculoskeletal clinics: a contingent valuation study in Quebec,Canada

Orthopedics is a discipline that requires a continuum of care in close collaboration with physicians, nurses, and healthcare professionals to ensure effective rehabilitation. In some cases, the wait time for a consultation may be very long, which can jeopardize the patient’s rehabilitation and sometimes even cause complications that lead to a loss of autonomy. In Quebec, there is a severe shortage of healthcare professionals—and of orthopedic surgeons, in particular—specializing in musculoskeletal problems. To address this problem, public managers have decided to establish interdisciplinary musculoskeletal clinics in regions outside the two major cities of Montréal and Québec. The major benefits of these clinics are that they reduce the wait time for consultation and treatment while maintaining service quality. Although their benefits are certain, these clinics remain threatened by relatively high initial costs. This study’s objective is to evaluate whether the population of Quebec has a quantifiable willingness to pay (WTP) to establish these clinics. To our knowledge, this is the first study of its kind either in the province of Quebec or elsewhere. We selected 3822 subjects randomly within the target population using Internet surveys, telephone surveys and self-administered paper surveys as our methods of recruitment. Three payment vehicles were used and each participant was randomly allocated among these: tax, donation or lump-sum fee. A contingent valuation question using a referendum format with the option “don’t know” was used. Econometric estimates were performed using probit and Wang’s models. Our results indicate that the population of Quebec may potentially have a mean WTP of 42.3 Canadian dollars per person for such clinics, which would enable a mean reduction from 12 to 4 months of wait time. However, the WTP is found to be very sensitive to the survey mode and the payment vehicle used: about 1.2–2 times more important in the tax and the lump-sum fee scenarios than in the donation scenario, and about 3–4 times less important in the Internet survey than in the telephone or self-administered paper surveys. In addition, this amount was strongly affected by the introduction of a new governmental health-related policy that arose during the survey and led to a minimal drop in WTP of about 30–50 %. This strong sensitivity led us to the three following recommendations for future contingent valuation studies: (1) favour Internet surveys, (2) use a payment vehicle that limit uncertainty in the WTP answer and allow to socialize benefits, as the tax scenario in our study, and (3) strictly apply the “divide by 2” rule of the NOAA panel.     

Willingness to pay for health insurance in a developing economy. A pilot study of the informal sector of Ghana using contingent valuation

In the midst of high cost of health care both at the macro and micro levels, health insurance becomes a viable alternative for financing health care in Ghana. It is also a way of mobilising private funds for improving health care delivery at the macro level. This study uses a contingent valuation method to assess the willingness of households in the informal sector of Ghana to join and pay premiums for a proposed National Health Insurance scheme. Focus group discussions, in-depth and structured interviews were used to collect data for the study. There was a high degree of acceptance of health insurance in all the communities surveyed. Over 90% of the respondents agreed to participate in the scheme and up to 63.6% of the respondents were willing to pay a premium of 5000 cents or $3.03 a month for a household of five persons. Using an ordered probit model, the level of premiums households were willing to pay were found to be influenced by dependency ratio, income or whether a household has difficulty in paying for health care or not, sex, health care expenditures and education. As income increases, or the proportion of unemployed household members drop, people are willing to pay higher premiums for health insurance.     

Hypothetical versus real willingness to pay in the health care sector: results from a field experiment

We conducted a field experiment comparing hypothetical and real purchase decisions for a pharmacist provided asthma management program among 172 subjects with asthma. Subjects received either a dichotomous choice contingent valuation question or were given the opportunity to actually enroll in the program. Three different prices were used: US$ 15, 40, and 80. In the hypothetical group, 38% of subjects said that they would purchase the good at the stated price, but only 12% of subjects in the real group purchased the good (p = 0.000). We cannot, however, reject the null hypothesis that "definitely sure" hypothetical yes responses, as identified in a follow-up question, correspond to real yes responses. We conclude that the dichotomous choice contingent valuation method overestimates willingness to pay, but that it may be possible to correct for this overestimation by sorting out "definitely sure" yes responses.     

The acceptance and willingness to pay (WTP) for hypothetical dengue vaccine in Penang,Malaysia: a contingent valuation study

Background

Malaysia has been experiencing an escalation in dengue cases since the past 5 years. As the dengue vaccine pipeline continues to develop steadily with strong public interests, this study had been sought to elicit the acceptance and the willingness to pay (WTP) for hypothetical dengue vaccine in Malaysia.

Methods

This study adopted the cross-sectional, contingent valuation study that involved 400 respondents in Penang, Malaysia. The double-bounded dichotomous choice via bidding game approach was employed to elicit the WTP value for two hypothetical 3-doses dengue vaccines (Vaccines A and B with 5- and 10-years’ protection, respectively against dengue). A univariate logistic regression model was employed to assess the key determinants of vaccine acceptance, while the mean WTP value and its associated factors were measured by using the parametric two-part model (TPM).

Results

Dengue vaccine appeared to be highly acceptable (88.4%) among the population in Penang, Malaysia. Respondents who were of Chinese ethnicity (OR 0.36, p?=?0.017), with higher dengue knowledge score (OR 1.43, p?=?0.016), and higher vaccination attitude score (OR 1.91, p?<?0.001) were more likely to accept the vaccine. The first step logit estimation from TPM displayed that pensioners (OR 2.37, p?=?0.036), respondents who were self-employed or working in the private sector (OR 1.21, p?=?0.002), respondents with higher education level (OR 2.09–3.29, p?<?0.05), and those who accepted the vaccine (OR 3.23, p?=?0.001) were more likely to pay for the vaccine. The adjusted mean WTP value for the vaccine was MYR39.21 (USD9.45) per dose. Next, the second-stage regression from TPM revealed the key factors that significantly affected the WTP value, which were composed of age, gender, occupation, household income, dengue prevention practice, and protection duration of the vaccine. The pensioners and those with better dengue prevention practice were willing to pay more for the vaccines. Additionally, all the respondents elicited a higher WTP amount toward the vaccine with longer protection duration (Vaccine B).

Conclusion

Strong acceptance toward dengue vaccine reflects the high value of the vaccine in Malaysia. The WTP estimates offer quantification of the private benefit in reducing occurrences of the disease. Besides, the people’s preferences-based WTP value for the vaccine tends to complement scientific decision-making and prioritization in the management of dengue in the country.

     

The inequity of informal payments for health care: the case of Hungary

As in most countries of Central and Eastern Europe, informal payments have been a characteristic feature of the Hungarian health care system both during and since the demise of Soviet type socialist rule. Although informal payments continue to be so characteristic in the region, little empirical evidence exists on their scope or working. As far as equity is concerned, it has sometimes been suggested that physicians play a 'Robin Hood' role and subsidise the poor at the expense of the rich. With the aid of an interview survey of a representative sample of the Hungarian population, we examine the distribution of the burden of informal payments across income groups. Results indicate that informal payments are a highly regressive way of funding health care, with Kakwani progressivity indices of -0.38, -0.39, -0.35 and -0.36 for GP, outpatient specialist, hospital, and total care, respectively. The finding that people with lower income pay proportionally more for public health care through informal payments underlines the emptiness of the 'Robin Hood' claims and the need for reform.     

Understanding informal payments for health care: the example of Bulgaria

INTRODUCTION: Throughout the 1990s, in response to funding deficits, out-of-pocket payment has grown as a share of total expenditure in countries in transition. A clear policy response to informal payments is, however, lacking. The current study explores informal payments in Bulgaria within a conceptual framework developed by triangulating information using a variety of methodologies. OBJECTIVE: To estimate the scale and determinants of informal payments in the health sector of Bulgaria and to identify who benefits, the characteristics and timing of payments, and the reasons for paying. DESIGN: Data were derived from a national representative survey of 1547 individuals complemented by in-depth interviews and focus groups with over 100 respondents, conducted in Bulgaria in 1997. Informal payments are defined as a monetary or in-kind transaction between a patient and a staff member for services that are officially free of charge in the state sector. RESULTS: Informal payments are relatively common in Bulgaria, especially if in the form of gifts. Informal cash payments are universal for operations and childbirth, clear-cut and life-threatening procedures, in hospitals or elite urban facilities or well-known physicians. Most gifts were given at the end of treatment and most cash payments-before or during treatment. Wealthier, better educated, younger respondents tend to pay more often, as a means of obtaining better-quality treatment in a de facto two-tier system. Since the transition, informal payments had become frequent, explicit, solicited by staff, increasingly in cash, and less affordable. Informal payments stem from the low income of staff, patients seeking better treatment; acute funding shortages; and from tradition. Attitudes to informal payments range from strongly negative (if solicited) to tolerant (if patient-initiated), depending on the circumstances. CONCLUSIONS: The study provides important new insights into the incidence and nature of informal payments in the health sector in Bulgaria. Payments were less than expected, very complex, organised in a chaotic, although adaptive, system, and relatively equitable. The timing of payment and the presence of compulsion is a key factor in distinguishing between informal payments given in gratitude or as a bribe, and the latter are seen as problematic, needing to be addressed. Paying informally appeared to be a product of socio-economic reality rather than culture and tradition. The study showed that the principle of comprehensive free coverage existing in Bulgaria until 1989 has been significantly eroded. Initiating a public debate on informal payments is important in a health care reform process that purports to increase accountability.     

Demand for health care in Denmark: results of a national sample survey using contingent valuation

In this paper we use willingness to pay (WTP) to elicit values for private insurance covering treatment for four different health problems. By way of obtaining these values, we test the viability of the contingent valuation method (CVM) and econometric techniques, respectively, as means of eliciting and analysing values from the general public. WTP responses from a Danish national sample survey, which was designed in accordance with existing guidelines, are analysed in terms of consistency and validity checks. Large numbers of zero responses are common in WTP studies, and are found here; therefore, the Heckman selectivity model and log-transformed OLS are employed. The selectivity model is rejected, but test results indicate that the lognormal model yields efficient and unbiased estimates. The results give confidence in the WTP estimates obtained and, more generally, in CVM as a means of valuing publicly provided goods and in econometrics as a tool for analysing WTP results containing many zero responses.     

Impoverishment and patients' "willingness" and "ability" to pay for improving the quality of health care in Palestine: an assessment using the contingent valuation method

This paper examines the impact of impoverishment on patients' preferences with respect to improving the quality of health care, by focusing on the sudden impoverishment experience that affected the Occupied Palestinian Territory (OPT) since the beginning of the second Palestinian Uprising of September 2000. Two random samples of patients (352 and 353 individuals, respectively) were interviewed about their willingness to pay for improving a set of quality attributes in delivery of primary health care, prior and after the occurrence of this crisis situation, using a contingent valuation questionnaire. Impoverishment did not seem to affect the structure of patients' preferences vis-à-vis some essential quality attributes such as "doctor-patient relationship" and "drug availability". However, preferences toward "luxury" quality attributes, e.g., "geographical proximity" and "waiting time", suffered from both income-dependent and income-independent negative impoverishment effects. We conclude that impoverishment might not only affect individuals' availability of resources but also the ability of certain groups of patients, notably women, villagers and the elderly, to adequately express their preferences toward improving the quality of health care delivery. The issue of how willingness to pay results should be interpreted in the light of our study for policy implications was discussed. The study raises strong doubts about the current policy of introducing patients' cost recovery schemes for funding primary health care in the current crisis situation of the OPT.     

Alternative approaches to obtain optimal bid values in contingent valuation studies and to model protest zeros. Estimating the determinants of individuals' willingness to pay for home care services in day case surgery

The use of day case surgery has increased rapidly as an alternative to inpatient surgery. Little is known, however, about the value of day case surgery to patients. The aim of this paper was to develop a contingent valuation survey to investigate how individuals value the costs of shifting from inpatient to day case surgery based on home care services. Using the willingness to pay (WTP) approach, two kinds of sequential experiments are compared: the maximum likelihood recursion (MLR) method and the C-optimal sequential procedure. The goal of sequential experimentation is to find bid values that provide the maximum possible information about the parameters of the WTP distribution, especially when the sample size is small. The C-optimal sequential procedure is shown to be an improvement, in terms of the statistical precision in small samples, over the MLR method. In addition, the paper presents a double hurdle (DH) approach for modelling the determinants of individuals' WTP. Using data from a contingent valuation survey conducted in 1996 on patients selected from the Day Case Surgery Unit in a hospital in the region of Catalonia, we argue that participation in the market offered and the level of consumption, that is, people's WTP, should be treated as individual choices. The results show that income and sex are related to WTP. Also, in this study, a clear presence of starting-point bias, introduced by the bid offered, was found. It is concluded that the WTP technique is potentially useful in evaluating health care programmes, although it is important to note that the criteria used to find an optimal design (in our model to minimize the asymptotic variance of the estimator used) may be restrictive from an economic point of view.