Since its inception in 2003, Cost Effectiveness and Resource Allocation journal has come a long way over the past 18 years. Possibly much longer than many of its contemporaries in the blossoming science of health economics might have anticipated. Today, entering 2020 it celebrates the Age of Maturity. We believe that in the third decade of XXI century the interdisciplinary science of health economics, will rejuvenate and come back to us younger than ever from its early historical roots almost a century ago. The spreading of economic globalization in several distinctive ways, either led by multinational business corporations or newly emerged Asian leadership, or both, is likely to make challenges for contemporary health systems far more serious. The fourth industrial revolution (cyber physical systems and artificial intelligence technology) and accelerated innovation in the field of E-Health and digital health, will probably change the workflow in medical and health care, and inevitably transform the labour market in the upcoming decades. So, let us be up to the task. Let us provide academic centres, industry-sponsored pharmaceutical and medical device innovation hubs, and governing authorities alike, with a powerful forum for debate on cost-effective resource allocation in the years to come.

Objectives: The purposes of this study are: (1) to empirically identify decision-making preferences of long-term health-care use, especially informal and formal home care (FHC) service use; (2) to evaluate outcomes vs. costs based on substitutability of informal and FHC service use; and (3) to investigate health outcome disparity based on substitutability. Methodology and data: The methods of ordinary least squares, a logit model, and a bivariate probit model are used by controlling for socioeconomic, demographic, and physical/mental health factors to investigate outcomes and costs based substitutability of informal and formal health-care use. The data come from the 2013 Japanese Study of Aging and Retirement (JSTAR), which is designed by Keizai-Sangyo Kenkyu-jo, Hitotsubashi University, and the University of Tokyo. The JSTAR is a globally comparable data survey of the elderly. Results: There exists a complement relationship between the informal home care (IHC) and community-based FHC services, and the elasticity’s ranges from 0.18 to 0.22. These are reasonable results, which show that unobservable factors are positively related to IHC and community-based FHC, but negatively related to nursing home (NH) services based on our bivariate probit model. Regarding health-care outcome efficiency issue, the IHC is the best one among three types of elderly care: IHC, community-based FHC, and NH services. Health improvement/outcome of elderly with the IHC is heavier concentrated on IHC services than the elderly care services by community-based FHC and NH care services. Conclusion: Policy makers need to address a diversity of health outcomes and efficiency of services based on providing services to elderly through resource allocation to the different types of long-term care. A provision of partial or full compensation for elderly care at home is recommendable and a viable option to improve their quality of lives.

Increasing national healthcare spending due to an aging population is a rising burden on society and the economy. Under pressure to improve healthcare systems, it is important to evaluate different healthcare systems including the national healthcare system in China, the universal healthcare system in Japan, and the mixed healthcare system in the USA. In the different health insurance frameworks, it is imperative to shift from a cost-based fee-for-service system to a capitation system.