Abstract
This study uses a system dynamics approach to analyzing the complexity of healthcare service system of Taiwan under the policy of the National Health Insurance (NHI), especially in modeling the financing scheme of the capitation pilot project. For NHI policy makers, the most important task is achieving NHI sustainability both in health promotion and medical cost containment that need to enable actors to interact (e.g., corporate, coordinate, negotiate) with other actors under the system design thinking. In the system dynamics modeling, this research identifies the benefits of capitation payment schemes under the NHI for patients, medical service providers, health promoters and the government. The model was built and validated based on publicly available statistical and transactional data of service providers experimenting capitation payment schemes to assess the system’s financial sustainability under different conditions. Three major sectors were explored in the experiments by simulating the capitation payment scheme over a period of 20 years. The main findings of this research can be summarized as follows: (1) medical expenditure per person can be reduced with more patients enrolled in the capitation payment schemes; (2) the Fee for Capitation model with health promotion service strategies will outperform fee-for-service (FFS) cost containments; (3) the financial risk of the service providers experimenting capitation payment schemes can be mitigated by administrative cost shared by NHIA These simulation results suggest that by combining the capitation model with proper risk estimates for primary care institutes, better payment policies can be formed in Taiwan which are cost effective.