Psychiatric inpatient expenditures and public health insurance programmes: analysis of a national database covering the entire South Korean population

Background: Medical spending on psychiatric hospitalization has been reported to impose a tremendous socioeconomic burden on many developed countries with public health insurance programmes. However, there has been no in-depth study of the factors affecting psychiatric inpatient medical expenditures and differentiated these factors across different types of public health insurance programmes. In view of this, this study attempted to explore factors affecting medical expenditures for psychiatric inpatients between two public health insurance programmes covering the entire South Korean population: National Health Insurance (NHI) and National Medical Care Aid (AID). Methods: This retrospective, cross-sectional study used a nationwide, population-based reimbursement claims dataset consisting of 1,131,346 claims of all 160,465 citizens institutionalized due to psychiatric diagnosis between January 2005 and June 2006 in South Korea. To adjust for possible correlation of patients characteristics within the same medical institution and a non-linearity structure, a Box-Cox transformed, multilevel regression analysis was performed. Results: Compared with inpatients 19 years old or younger, the medical expenditures of inpatients between 50 and 64 years old were 10% higher among NHI beneficiaries but 40% higher among AID beneficiaries. Males showed higher medical expenditures than did females. Expenditures on inpatients with schizophrenia as compared to expenditures on those with neurotic disorders were 120% higher among NHI beneficiaries but 83% higher among AID beneficiaries. Expenditures on inpatients of psychiatric hospitals were greater on average than expenditures on inpatients of general hospitals. Among AID beneficiaries, institutions owned by private groups treated inpatients with 32% higher costs than did government institutions. Among NHI beneficiaries, inpatients medical expenditures were positively associated with the proportion of patients diagnosed into dementia or schizophrenia categories. However, for AID beneficiaries, inpatient medical expenditures were positively associated with the proportion of all patients with a psychiatric diagnosis that were AID beneficiaries in a medical institution. Conclusions: This study provides evidence that patient and institutional factors are associated with psychiatric inpatient medical expenditures, and that they may have different effects for beneficiaries of different public health insurance programmes. Policy efforts to reduce psychiatric inpatient medical expenditures should be made differently across the different types of public health insurance programmes.