Modelling the Rationing of Healthcare

The previous note investigated the likelihood of switching from the public sector to the private sector in
response to universal insurance, abolition of co-payments and free provider choice, as was proposed in
the original National Health Insurance (NHI) documents. This note analyses the impact of factors that
effectively ration public healthcare. In reaction to the lower prominence given to private providers in
the new round of documents, our model no longer assumes free choice of provider. We consider how
the NHI would change the demand for public healthcare services if it resulted in shorter waiting times
at public clinics and hospitals, as well as increased the access to general practitioners (GPs) in the public
healthcare system. The model predicts that relatively large and expensive changes in these factors would
only have a moderate impact on the choice between providers