C. VAN DE VOORDE ET AL has gradually expanded and fine-tuned their use excluding most ambulatory care), and the general n its universal and compulsory public health in- plan for all other insured, mainly blue and white surance plan. But at the same time, Belgium is a collar workers in public and private service and country with one of the highest densities of doc- recipients of social security benefits(88% in 1995) tors in Europe, all remunerated exclusively on a covering all risks. Both plans cover the active and fee-for-service basis, thereby creating ideal condi- the non-active population, as well as their depen tions for supplier-induced responses in demand to dants. We will only consider the general plan. The exogenous shocks in income provision of medical care is predominantly pri- In an attempt to control rising public health vately organized in a government-regulated envi- are costs, the Belgian government has raised ronment. Patients have free choice of physician Ca coinsurance rates several times over this period, and direct access to GP, as well as to specialist with a fairly sharp increase on I January 1994 for care. Physician density in Belgium is extremely all insured, except for some exempt categories high by European standards. In 1995, there were (elderly, disabled, etc. )on low incomes. At the only 660 inhabitants per practising GP and 630 same time-and in order to mitigate the poten- per specialist tially harmful consequences for health care ac- Physician remuneration is on the basis of fee cess--income-related annual maximum amounts for-service with some patient co-payments. Pa- of user charges were introduced. Because not only tients pay the entire physician fee and get a fixed of care but also utilization volumes appeared to Physician fee schedules are established annually stop growing(or even to decrease)in the period but physicians can opt out of negotiated fees by 1994-1995, it is worthwhile to investigate the role formally objecting to them. In order to obtain the played by user charges in physician services uti lization rates privilege to 'overbill,, they are required to inform This paper is organized as follows. In the next schedules. There are no official estimates of the section, we briefly explain the most important features of the belgian hea Ith care and public number of specialists opting out of negotiated health insurance system, with an emphasis on the fees, but it is well known that this is most com- role of patient cost sharing. The third section mon in tertiary care like cardiac and other as paediatrics and gynaecology), and for the GP sharing, with a view to deriving some empirically opting out of the negotiated fees, it is less verifiable propositions about their likely effects. coon The reimbursement percentage differs by type section dataset that was available and the two of care and status of the insured. One group, different kinds of models used to analyse it. It which we will label "low-income WOPI, consist lso presents some testable hypotheses derived ing of widows, orphans, pensioners and invalids from the surveyed literature. The fifth section( disabled)(WOPT)with incomes below a certain presents and discusses the estimation results ob- ceiling, benefits from more generous reimburse- tained using both approaches. The sixth section ment. In 1995, for example, the price of a GP draws some conclusions from the findings. consultation (in the office) was 550 BFr(equiva lent to about 14 Euros), 30% of which is an out-of-pocket co-payment for the general popula tion, while the co-payment was only 8% for PATIENT COST SHARING IN PUBLIC HEALTH INSURANCE IN BELGIUM low-income WOPI. The price of a specialist con sultation was about 840 BFr, but had higher coinsurance rates (40% and 14%0, respectively) Compulsory health insurance covers nearly all The price of a GP home visit was slightly higher citizens in Belgium(99% in 1995)and is financed (670 BFr), with 35%0 and 8% co-payment. In primarily by income-related social insurance con- contrast to the French situation [3], reinsurance of tributions [2]. There are two main insurance these co-payments is virtually non-existent in Bel plans: one plan for the self-employed(12% of all gium. Some private insurance for co-payments is insured in 1995) covering only major risks (i.e. being offered, but mostly as a fringe benefit for Copyright a 2001 John Wiley Sons, Ltd Health Econ.10:457-471(2001)458 C. VAN DE VOORDE ET AL. has gradually expanded and fine-tuned their use in its universal and compulsory public health in￾surance plan. But at the same time, Belgium is a country with one of the highest densities of doc￾tors in Europe, all remunerated exclusively on a fee-for-service basis, thereby creating ideal condi￾tions for supplier-induced responses in demand to exogenous shocks in income. In an attempt to control rising public health care costs, the Belgian government has raised coinsurance rates several times over this period, with a fairly sharp increase on 1 January 1994 for all insured, except for some exempt categories (elderly, disabled, etc.) on low incomes. At the same time—and in order to mitigate the poten￾tially harmful consequences for health care ac￾cess—income-related annual maximum amounts of user charges were introduced. Because not only public health care expenditures for certain types of care but also utilization volumes appeared to stop growing (or even to decrease) in the period 1994–1995, it is worthwhile to investigate the role played by user charges in physician services uti￾lization rates. This paper is organized as follows. In the next section, we briefly explain the most important features of the Belgian health care and public health insurance system, with an emphasis on the role of patient cost sharing. The third section briefly reviews some of the main findings of a selection of previous empirical studies on cost sharing, with a view to deriving some empirically verifiable propositions about their likely effects. The fourth section describes the time-series cross￾section dataset that was available and the two different kinds of models used to analyse it. It also presents some testable hypotheses derived from the surveyed literature. The fifth section presents and discusses the estimation results ob￾tained using both approaches. The sixth section draws some conclusions from the findings. PATIENT COST SHARING IN PUBLIC HEALTH INSURANCE IN BELGIUM Compulsory health insurance covers nearly all citizens in Belgium (99% in 1995) and is financed primarily by income-related social insurance con￾tributions [2]. There are two main insurance plans: one plan for the self-employed (12% of all insured in 1995) covering only major risks (i.e. excluding most ambulatory care), and the general plan for all other insured, mainly blue and white collar workers in public and private service and recipients of social security benefits (88% in 1995), covering all risks. Both plans cover the active and the non-active population, as well as their depen￾dants. We will only consider the general plan. The provision of medical care is predominantly pri￾vately organized in a government-regulated envi￾ronment. Patients have free choice of physician and direct access to GP, as well as to specialist care. Physician density in Belgium is extremely high by European standards. In 1995, there were only 660 inhabitants per practising GP and 630 per specialist. Physician remuneration is on the basis of fee￾for-service with some patient co-payments. Pa￾tients pay the entire physician fee and get a fixed percentage reimbursed from their sickness fund. Physician fee schedules are established annually but physicians can opt out of negotiated fees by formally objecting to them. In order to obtain the privilege to ‘overbill’, they are required to inform patients of their non-adherence to the national fee schedules. There are no official estimates of the number of specialists opting out of negotiated fees, but it is well known that this is most com￾mon in tertiary care like cardiac and other surgery. For the ‘direct access’ specialisms (such as paediatrics and gynaecology), and for the GPs opting out of the negotiated fees, it is less common. The reimbursement percentage differs by type of care and status of the insured. One group, which we will label ‘low-income WOPI’, consist￾ing of widows, orphans, pensioners and invalids (disabled) (WOPI) with incomes below a certain ceiling, benefits from more generous reimburse￾ment. In 1995, for example, the price of a GP consultation (in the office) was 550 BFr (equiva￾lent to about 14 Euros), 30% of which is an out-of-pocket co-payment for the general popula￾tion, while the co-payment was only 8% for low-income WOPI. The price of a specialist con￾sultation was about 840 BFr, but had higher coinsurance rates (40% and 14%, respectively). The price of a GP home visit was slightly higher (670 BFr), with 35% and 8% co-payment. In contrast to the French situation [3], reinsurance of these co-payments is virtually non-existent in Bel￾gium. Some private insurance for co-payments is being offered, but mostly as a fringe benefit for Copyright © 2001 John Wiley & Sons, Ltd. Health Econ. 10: 457–471 (2001)