The Effects of the Primary-Care-First Policy on Patients' Healthcare Choices and Medical Expenditures

Primary-care-first consultation is a critical component of tiered healthcare delivery and is important for establishing orderly healthcare-seeking pathways and controlling medical expenditures. Using health insurance claims data, this paper employs a regression discontinuity difference-in-differences design to examine the effects of the primary-care-first policy on patients' healthcare choices and medical expenditures. The results show that the policy significantly reduces both the probability that insured individuals aged 61–64 choose tertiary hospitals for their initial consultation and the corresponding total cost of treatment per course, but does not alter the initial healthcare choices of those who have not retired. Mechanism analysis indicates that the policy affects patients' choices by widening the disparity in health insurance benefits between initial consultations at primary care institutions and those that bypass them to higher-tier hospitals, as well as by increasing time costs. Moreover, after the policy was implemented, insured individuals aged 61–64 were more likely to flow to secondary hospitals rather than primary care institutions, and the limited service capacity of primary care institutions is the main factor impeding patients from seeking care at lower-tier institutions. The findings indicate that the primary-care-first policy changes the initial healthcare choices of only some older patients, particularly those with chronic diseases, and does not alter the preference of the non-retired population for seeking care at higher-tier hospitals. Promoting tiered healthcare delivery solely through demand-side cost sharing therefore has relatively limited effects.