A Study of the Impacts of National Health Insurance on Operating Efficiencies of Medical Institutions

It has been fifteen years since the National Health Insurance (NHI) was instituted. The financial deficit of NHI has been increasing steadily for the past years. The goal of this study is to examine the impacts of National Health Insurance (NHI) on operating efficiencies of medical institutions. The observations are composed of the public medical institutions during the period from 1989 through 1998. We compare the operating efficiencies between the pre-and post-NHI periods. Empirical results do not support the hypothesis that NHI has positive influences on operating efficiencies of medical institutions. When the government agency tries to raise the premium rate of NHI to cover the financial deficit, how to improve the operating efficiencies of medical institutions remains an issue to be investigated in the future.