People's willingness to pay for health insurance in rural Vietnam

Background

The inequity caused by health financing in Vietnam, which mainly relies on out-of-pocket payments, has put pre-payment reform high on the political agenda. This paper reports on a study of the willingness to pay for health insurance among a rural population in northern Vietnam, exploring whether the Vietnamese are willing to pay enough to sufficiently finance a health insurance system.

Methods

Using the Epidemiological Field Laboratory for Health Systems Research in the Bavi district (FilaBavi), 2070 households were randomly selected for the study. Existing FilaBavi interviewers were trained especially for this study. The interview questionnaire was developed through a pilot study followed by focus group discussions among interviewers. Determinants of households' willingness to pay were studied through interval regression by which problems such as zero answers, skewness, outliers and the heaping effect may be solved.

Results

Households' average willingness to pay (WTP) is higher than their costs for public health care and self-treatment. For 70–80% of the respondents, average WTP is also sufficient to pay the lower range of premiums in existing health insurance programmes. However, the average WTP would only be sufficient to finance about half of total household public, as well as private, health care costs. Variables that reflect income, health care need, age and educational level were significant determinants of households' willingness to pay. Contrary to expectations, age was negatively related to willingness to pay.

Conclusion

Since WTP is sufficient to cover household costs for public health care, it depends to what extent households would substitute private for public care and increase utilization as to whether WTP would also be sufficient enough to finance health insurance. This study highlights potential for public information schemes that may change the negative attitude towards health insurance, which this study has uncovered. A key task for policy makers is to win the trust of the population in relation to a health insurance system, particularly among the old and those with relatively low education.     

Willingness to pay for rural health insurance through community participation in India

The main objective of this article is to examine the willingness to pay for a viable rural health insurance scheme through community participation in India, and the policy concerns it engenders. The willingness to pay for a rural health insurance scheme through community participation is estimated through a contingent valuation approach (logit model), by using the rural household survey on health from Karnataka State in India. The results show that insurance/saving schemes are popular in rural areas. In fact, people have relatively good knowledge of insurance schemes (especially life insurance) rather than saving schemes. Most of the people stated they are willing to join and pay for the proposed rural health insurance scheme. However, the probability of willingness to join was found to be greater than the probability of willingness to pay. Indeed, socio-economic factors and physical accessibility to quality health services appeared to be significant determinants of willingness to join and pay for such a scheme. The main justification for the willingness to pay for a proposed rural health insurance scheme are attributed from household survey results: (a) the existing government health care provider's services is not quality oriented; (b) is not easily accessible; and, (c) is not cost effective. The discussion suggests that policy makers in India should take serious note of the growing influence of the private sector and people's willingness to pay for organizing a rural health insurance scheme to provide quality and efficient health care in India. Policy interventions in health should not ignore private sector existence and people's willingness to pay for such a scheme and these two factors should be explicitly involved in the health management process. It is also argued that regulatory and supportive policy interventions are inevitable to promote this sector's viable and appropriate development in organizing a health insurance scheme.     

Willingness to pay for district hospital services in rural Tanzania

This paper describes a study undertaken to investigate the willingness of patients and households to pay for rural district hospital services in north-western Tanzania. The surveys undertaken included interviews with 500 outpatients and 293 inpatients at three district level hospitals, interviews with 1500 households and discussions with 22 focus groups within the catchment areas of the primary health care programmes of these hospitals. Information was collected on willingness to pay fees for certain hospital services, willingness to become a member of a local insurance system, and exemptions for cost-sharing. The willingness to pay for district hospital services was large. Furthermore, most respondents favoured a local insurance system above user fee systems, a finding which applied at all places and in all the surveys. More female respondents were in favour of a local insurance scheme. The conditions needed for the introduction of a local insurance system are discussed.     

Quality Health Care and Willingness to Pay for Health Insurance Retention: A Randomized Experiment in Kolkata Slums

The low quality of health care in developing countries reduces the poor's incentives to use quality health services and their demand for health insurance. Using data from a field experiment in India, I show that randomly offering insurance policyholders a free preventive checkup with a qualified doctor has a twofold effect: receiving this additional benefit raises willingness to pay to renew health insurance by 53%, doubling the likelihood of hypothetical renewal; exposed individuals are 10 percentage points more likely to consult a qualified practitioner when ill after the checkup. Both effects are concentrated on poorer households. There is no effect on health knowledge and healthcare spending. This suggests that exposing insured households to quality preventive care can be a cost‐effective way of raising the demand for quality health care and retaining policyholders in the insurance scheme. Copyright © 2016 John Wiley & Sons, Ltd.     

Willingness to pay for health insurance in a developing economy. A pilot study of the informal sector of Ghana using contingent valuation

In the midst of high cost of health care both at the macro and micro levels, health insurance becomes a viable alternative for financing health care in Ghana. It is also a way of mobilising private funds for improving health care delivery at the macro level. This study uses a contingent valuation method to assess the willingness of households in the informal sector of Ghana to join and pay premiums for a proposed National Health Insurance scheme. Focus group discussions, in-depth and structured interviews were used to collect data for the study. There was a high degree of acceptance of health insurance in all the communities surveyed. Over 90% of the respondents agreed to participate in the scheme and up to 63.6% of the respondents were willing to pay a premium of 5000 cents or $3.03 a month for a household of five persons. Using an ordered probit model, the level of premiums households were willing to pay were found to be influenced by dependency ratio, income or whether a household has difficulty in paying for health care or not, sex, health care expenditures and education. As income increases, or the proportion of unemployed household members drop, people are willing to pay higher premiums for health insurance.     

The link between past informal payments and willingness of the Hungarian population to pay formal fees for health care services: results from a contingent valuation study

We examine the willingness of health care consumers to pay formal fees for health care use and how this willingness to pay is associated with past informal payments. We use data from a survey carried out in Hungary in 2010 among a representative sample of 1,037 respondents. The contingent valuation method is used to elicit the willingness to pay official charges for health care services covered by the social health insurance if certain quality attributes (regarding the health care facility, access to the services and health care personnel) are guaranteed. A bivariate probit model is applied to examine the relationship between willingness to pay and past informal payments. We find that 66 % of the respondents are willing to pay formal fees for specialist examinations and 56 % are willing to pay for planned hospitalizations if these services are provided with certain quality and access attributes. The act of making past informal payments for health care services is positively associated with the willingness to pay formal charges. The probability that a respondent is willing to pay official charges for health care services is 22 % points higher for specialist examinations and 45 % points higher for hospitalization if the respondent paid informally during the last 12 months. The introduction of formal fees should be accompanied by adequate service provision to assure acceptance of the fees. Furthermore, our results suggest that the problem of informal patient payments may remain even after the implementation of user fees.     

Economic consequences of ill-health for households in northern rural India

Background

As compared to other countries in South East Asia, India’s health care system is characterized by very high out of pocket payments, and consequently low financial protection and access to care. This paper describes the relative importance of ill-health compared to other adverse events, the conduits through which ill-health affects household welfare and the coping strategies used to finance these expenses.

Methods

Cross-sectional data are used from a survey conducted with 5241 households in Uttar Pradesh and Bihar in 2010 that included a household shocks module and detailed information about health care use and spending.

Results

Health-related adverse events were the second most common adverse events (34%), after natural disasters (51%). Crop and livestock disease and weddings each affected about 8% of households. Only a fourth of households reported to have recovered from illness and/or death in the family (by the time of the survey). Most of the households’ economic burden related to ill-health was depending on direct medical costs, but indirect costs (such as lost earnings and transportation or food costs) were also not negligible. Close to half of the health expenditures were made for chronic conditions. Households tried to cope with health-related expenditures mostly by dissaving, borrowing and selling assets. Few households reported having to reduce (food) consumption in response to ill-health.

Conclusions

In the absence of pre-financing schemes, ill-health events pose a substantial threat to household welfare in rural India. While most households seem to be able to smooth consumption in the short term, coping strategies like selling assets and borrowing from moneylenders are likely to have severe long term consequences. As most of the households’ economic risk related to ill-health appears to depend on out of pocket spending, introducing health insurance may contribute significantly to alleviate economic hardship for families in rural India. The importance of care for chronic diseases, however, represents a big challenge for the sustainability of community based health insurance schemes, since it is necessary to ensure a sufficient degree of risk pooling.

     

Willingness to Join and Pay for the Newly Proposed Social Health Insurance among Teachers in Wolaita Sodo Town,South Ethiopia

Background

Cost-sharing between beneficiaries and governments is critical to achieve universal health care coverage. To address this, Ethiopia is currently introducing Social Health Insurance. However, there has been limited evidence on willingness to join the newly proposed insurance scheme in the country. The purpose of this study is to assess willingness to join and pay for the scheme among teachers in Wolaita Sodo Town government educational institutions, South Ethiopia.

Methods

A cross-sectional study was conducted from February 5 to March 10, 2012 on 335 teachers. Stratified simple random sampling technique was used and data were collected using structured interviewer administered questionnaire. Binary and multiple logistic regressions were used to estimate the crude and adjusted odds ratios for willingness to pay.

Results

Three hundred twenty-eight teachers participated in the study with response rate of 98%. About 55% of the teachers had never heard of any type of health insurance scheme. However, 74.4% of them were willing to pay for the suggested insurance scheme. About 47% of those who were willing to pay agreed to contribute greater than or equal to 4% of their monthly salaries. Willingness to pay was more likely among those who had heard about health insurance, had previous history of inability to pay for medical bills and achieved higher educational status.

Conclusion

The majority of the teachers were willing to join social health insurance; however, adequate awareness creation and discussion should be made with all employees at various levels for the successful implementation of the scheme.     

Impact of Health Insurance on Health Care Treatment and Cost in Vietnam: A Health Capability Approach to Financial Protection

We applied an alternative conceptual framework for analyzing health insurance and financial protection grounded in the health capability paradigm.Through an original survey of 706 households in Dai Dong, Vietnam, we examined the impact of Vietnamese health insurance schemes on inpatient and outpatient health care access, costs, and health outcomes using bivariate and multivariable regression analyses. Insured respondents had lower outpatient and inpatient treatment costs and longer hospital stays but fewer days of missed work or school than the uninsured.Insurance reform reduced household vulnerability to high health care costs through direct reduction of medical costs and indirect reduction of income lost to illness. However, from a normative perspective, out-of-pocket costs are still too high, and accessibility issues persist; a comprehensive insurance package and additional health system reforms are needed.Health insurance reform is of utmost concern for low-income countries that rely on out-of-pocket payments to finance health treatment, but many new policies have not been sufficiently assessed for their impact on the health and economic stability of households. A review of the World Bank impact evaluation database found that of 41 health-related impact evaluations as of April 2005, health reform and financing studies were lacking.1 Many studies focus on a particular change within a system, rather than changes affecting the entire system. For example, a Thai study2 investigated the impact of subsidizing the Thai health card scheme on insurance coverage and utilization. A Chinese study3 evaluated how changing hospital reimbursement from fee-for-service to prepayment affected health expenditure in China. Although these are important aspects of health insurance policy, they concern one change rather than system-wide reform. New insurance schemes constitute a major type of large-scale health care system reform, and require evaluation to determine whether they achieve their purpose. In this study, we employed a survey conducted in 2008 to assess the effects of reformed Vietnamese health insurance schemes on health care treatment and costs for households.Vietnam is a developing country that relies extensively on out-of-pocket payments for health care. In 2005, 5% of Vietnam’s gross domestic product was spent on health expenditure, and out-of-pocket payments accounted for 68% of health expenditure.4 Following the privatizing Doi Moi (“New Era”) economic reforms in the late 1980s, health care in Vietnam transitioned from a centralized system of free universal access to a user charge system at public health facilities and newly legalized private facilities. The pharmaceutical industry also became privatized. Out-of-pocket health payments as a proportion of total national health expenditure increased from 59% in 1989 to 80% in 1998, posing a substantial burden to ill households, particularly poor ones.5 In response to this problem, Vietnam instituted a health insurance system in 1993. At the time of its establishment, it consisted of compulsory health insurance (CHI) for employees of state institutions and of private businesses with more than 10 employees. A voluntary health insurance scheme was later added to cover the self-employed, informal-sector employees, dependents of CHI members, and employees at lower-level state institutions excluded by CHI.5–7In 2002, Vietnam reformed the insurance system. The government targeted the low-income population with Free Health Care Cards for the Poor, enrolling low-income individuals in a social health insurance scheme (a component of CHI). However, service provision was challenging because of limited funds, difficulty of the application process, and lack of public awareness of the scheme itself.8 The government addressed these problems through a decree called Decision 139, which required provincial governments to give free health care to disadvantaged populations.8Currently, CHI comprises 3 programs that in 2007 covered 41% of the population: (1) social health insurance for the formally employed (9%), retirees, dependents of military and police officers, and meritorious people (3%; which include war “heroes” and “veterans” and others with substantial contributions to the socialist revolution4); (2) Health Care Fund for the Poor (HCFP), which replaced Free Health Care Cards for the Poor (18%); and (3) free health care for children younger than 6 years (11%). CHI covers the costs of inpatient treatment at state hospitals and outpatient treatment at outpatient clinics or departments within state hospitals.6 It covers only inpatient drugs included on a Ministry of Health list. In most cases, it does not cover drugs for outpatient visits.4 The social health insurance and HCFP components of CHI are designed to offer the same benefits to their respective beneficiaries.6 Social health insurance is funded by a tax on payroll, pension, or salary not exceeding 3%, whereas HCFP receives three quarters of its funding from the central government and the rest from provincial government. Costs of health care for children younger than 6 are covered by the central government. Voluntary health insurance covered another 11% of the population in 2007 and is financed by individuals through private premiums, with costs dependent on financial capacity.6Several studies have assessed recent insurance reforms in Vietnam, revealing positive impacts. One study, which compared the out-of-pocket health payments for all health services of insured vs uninsured groups, found that health insurance decreased out-of-pocket expenses between 16% and 18%, with a more substantial decrease for lower-income residents.5 The social health insurance scheme increased health service utilization and reduced levels of self-medication.9 An evaluation of Vietnam’s HCFP, a program initiated in 2003, showed more mixed results.8 With insurance, poor households significantly increased utilization of inpatient treatments, with insured households 30% more likely to have inpatient treatment. However, the probability of utilizing outpatient services increased by only 16%, probably because of the limited insurance coverage of outpatient treatment. Moreover, poor households with insurance were still vulnerable to high health expenses. Nearly one third of HCFP beneficiaries were confronted with “catastrophic” out-of-pocket payments, defined as amounting to more than 10% of nonfood consumption. Another Vietnam study focused on the economic consequences of health shocks.10Most studies of Vietnam’s health insurance analyzed the Vietnam Living Standard Surveys (VLSS), a series of national household surveys in 1992 and 1993, 1997 and 1998, 2002, and 2004, but they did not include the 2006 wave. A more recent report by the World Bank included 2006 VLSS data, with conclusions similar to those of past studies. However, as the insurance system has undergone further changes since 2005, this analysis may not fully reflect the current insurance scheme and its impact on the Vietnamese population.We applied an alternative conceptual framework for analyzing health insurance and financial protection grounded in the health capability paradigm. As opposed to the narrow metrics of catastrophic and out-of-pocket expenditures, we broadly construed financial protection as that which reduces individual''s health and economic vulnerabilities and insecurities. We studied health insurance in terms of the effective rate of coverage and the extent to which that coverage results in better health care access, health outcomes, and financial security. Thus, health insurance was analyzed in the context of health and economic capabilities and security rather than the theory of the demand for health insurance or the narrow metrics of catastrophic, out-of-pocket payments.We present the results of a 2008 household survey that we designed and conducted from a capability perspective to study the impact of the current insurance scheme on households in Dai Dong, a rural commune of Hanoi, with particular emphasis on the vulnerable poor population. Because the survey covered the time period July 2007 to July 2008, our study addressed the consequences of recent changes, as well as implications for future reform. Rather than comparing households before and after insurance coverage, we compared households with and without insurance. In addition, we examined households that have insurance but do not use it, to better describe the reasons for and consequences of insurance underutilization. Furthermore, we focused on the subpopulation with at least 1 episode of illness. Unlike previous household surveys, in which the percentage of the sample population having an illness episode ranged from 35.1% to 62.4%,11 83.6% of our sampled households had at least 1 illness that warranted inpatient or outpatient treatment in the 12 months preceding the survey. Our study thus enabled us to more closely investigate the impact of insurance among ill individuals who need it most.Unlike previous studies that considered single insurance schemes such as HCFP,8 our study also compared the impact of HCFP with that of other types of insurance in Vietnam. Because studies have yet to adequately consider the impact of Vietnam’s insurance of children younger than 6 years, we included this as a separate insurance type in our study. In addition, whereas previous studies have included poor populations, we extended the frame to also include “near-poor” households. This is because policy discussions have been under way to possibly cover the “near-poor” population under HCFP.6 Our study evaluated the impact of health treatment costs on this particular group to better guide future policy.Our study was guided by a health capability conception of health insurance. According to this theoretical perspective, besides economic reasons, there are also moral and ethical claims for providing universal health insurance, and an effective insurance system must be driven by 2 foundational principles.12 The first is to ensure people’s ability for health functioning. That is, an individual must be able to obtain health care when necessary, and thereby achieve positive health outcomes. We investigated health care accessibility and health outcomes by gathering data on use of different public and private health facilities, health outcomes after treatment, and missed days of school and work through illness.The second goal is for insurance to enhance people’s security by decreasing their vulnerability to the detrimental economic effects of illness and health care costs. When faced with the high costs of health treatment, households are forced to pursue coping strategies such as borrowing and reducing food consumption, which create or exacerbate financial and health problems. An effective insurance system should reduce health costs and prevent their harmful consequences. To fully illuminate the effects of these costs on well-being, we examined all health treatment and treatment-associated costs among insured and uninsured populations. Both principles are part of an alternative framework for analyzing health insurance and financial protection.13a