AimThe effect of raising insurance co‐payment rates on healthcare service utilization in Japan remains unclear. In this study, we utilized patient‐level long‐term care (LTC) insurance claims data to analyze these effects.MethodsClaims data were obtained on individuals certified as requiring LTC in City A and City B, Fukuoka Prefecture, Japan during August 2014–July 2016. Individuals whose LTC insurance co‐payment rate increased from 10% to 20% in August 2015 were regarded as high‐income individuals; individuals whose co‐payment rate remained at 10% were regarded as non–high‐income individuals. We examined the changes in LTC service utilization between high‐income individuals and non–high‐income individuals during the study period. Monthly LTC insurance charges were analyzed to evaluate service utilization. We created monthly panel data for the study participants, and quantified the differences in LTC service utilization before and after August 2015 between the high‐income and non–high‐income groups. Care needs levels and age were included as covariates in a fixed‐effects model.ResultsThe sample comprised 7711 individuals (1000 high‐income individuals and 6711 non–high‐income individuals) in City A and 647 individuals (84 high‐income individuals and 563 non–high‐income individuals) in City B. After adjusting for care needs levels and age, the co‐payment rate increase was associated with reductions in monthly LTC insurance charges of $34.3 (P < 0.001) in City A and $91.0 (P = 0.022) in City B.ConclusionThe increase in co‐payment rate for high‐income individuals in August 2015 negatively affected their utilization of LTC services. Geriatr Gerontol Int ••; ••: ••–•• Geriatr Gerontol Int 2020; ••: ••–••.