2006 Volume 18 Issue 1 Pages 23-39
The purpose of this paper is to investigate the relationship between the health care costs of employees on one hand, and their self-reported health and stress levels, on the other. For our analysis, we have used a combined dataset of personal information obtained from our questionnaire on life-style and panel data of health care costs of four thousand volunteering employees in a particular Japanese firm. For the sake of simplicity, we have limited our sample to lifetime non-smokers in this paper.
First, we have analyzed the factors that influence the subjective health rating. Our findings suggest that, while (1) sex and age do not affect their ratings, (2) many so-called “life-style diseases”, such as hypertension, stomach cancer, stroke, alcohol-dependency, substantially lower them. Since most of the employees in our sample are quite healthy and free from these diseases, however, in explaining the variation in their subjective health ratings, (3) such common complaints as stiff-shoulders, lower-back pains, pains in joints of arms and legs, numbness in arms and legs, and overall-fatigue, play far more important roles than these serious diseases, and (4) differences in their self-reported stress levels seem to be the single most important factor.
Secondly, we have analyzed the effect of subjective health rating on the health care costs by estimating the health care cost equation and subjective health rating equation simultaneously. We have relied heavily on the rich personal information supplied by our questionnaire for our instruments. According to our result, (4) a one-level improvement of subjective health rating reduces the health care costs by more than 30 percent, and (5) a one-level increase in the self-reported stress reduces the subjective health level by 0.3. Thus we can conclude that a one-level increase in self-reported stress increases the health care costs by almost 10%.
In general, it seems fair to say that Japanese public health insurance system has been primarily designed to deal with physiological changes of patients. But for stress-related changes, psychological approaches or therapies may turn out to be far more efficient. Some firms are reported to have already started to provide psychologist's services to their employees, and, if our analysis is correct, we can expect some concrete results in controlling health care costs. Moreover, in a recent study on the subjective health of the elderly population, depression is found to be an extremely important determinant. If that is the case, we should start investigating whether or not we should allocate more of our health care resources to psychological therapies, particularly in the care of our elderly.
