An analysis of private health insurance purchasing decisions with national health insurance in Taiwan

The Taiwanese health insurance industry is just over 30 years old. Originally private and domestic, the industry underwent substantial institutional changes when it opened to foreign competition between 1987 and 1994 and when the Taiwanese government established national health insurance (NHI) coverage in 1995. Congruent with these changes, rapid growth occurred in the Taiwanese demand for private health insurance. In order to better understand the recent performance of the Taiwanese health insurance industry, the structure of the NHI system is described and then household decisions to purchase private health insurance are analyzed using a two-part (hurdle) model on 1998 Survey of Family Income and Expenditure data. Logistic and OLS regressions are used to examine the factors influencing the probability and amount of private health insurance purchased. Generally, factors affecting the probability of having insurance also influence the amount of insurance coverage purchased. Higher income and education levels are associated with increased probabilities and larger quantities of private insurance purchases. Married females, the employed, and household heads working in state-run enterprises are more likely to purchase private insurance than their counterparts. The probability of private insurance purchases varies by region, with northern Taiwanese households having higher odds of owning private insurance than non-northern households. Compared to those in rural villages, households in cities and towns are more likely to have private insurance. The likelihood of private insurance purchase also tends to rise with advancing age and larger family sizes. In addition, one important implication in the private health insurance market is highlighted. There is no complementarity between the public and private systems.     

Taiwan's new national health insurance program: genesis and experience so far

In 1995, after a planning effort of about half a decade, the Republic of China (Taiwan) replaced a previous patchwork of separate social health insurance funds with one single-payer, national health insurance scheme that is administered by an agency of the central government's Department of Health. Within a year this bold legislative act brought the health care utilization rates of the 41 percent of Taiwan's hitherto uninsured population up to par with those of the previously insured population. This paper describes the achievements of this policy initiative so far, along with the growing pains it has encountered, and seeks to extract lessons from the experience for health policymakers in other countries.     

Assessing the impoverishment effects of out-of-pocket healthcare payments prior to the uptake of the national health insurance scheme in Ghana

Background

There is a global concern regarding how households could be protected from relatively large healthcare payments which are a major limitation to accessing healthcare. Such payments also endanger the welfare of households with the potential of moving households into extreme impoverishment. This paper examines the impoverishing effects of out-of-pocket (OOP) healthcare payments in Ghana prior to the introduction of Ghana’s national health insurance scheme.

Methods

Data come from the Ghana Living Standard Survey 5 (2005/2006). Two poverty lines ($1.25 and $2.50 per capita per day at the 2005 purchasing power parity) are used in assessing the impoverishing effects of OOP healthcare payments. We computed the poverty headcount, poverty gap, normalized poverty gap and normalized mean poverty gap indices using both poverty lines. We examine these indicators at a national level and disaggregated by urban/rural locations, across the three geographical zones, and across the ten administrative regions in Ghana. Also the Pen’s parade of “dwarfs and a few giants” is used to illustrate the decreasing welfare effects of OOP healthcare payments in Ghana.

Results

There was a high incidence and intensity of impoverishment due to OOP healthcare payments in Ghana. These payments contributed to a relative increase in poverty headcount by 9.4 and 3.8% using the $1.25/day and $2.5/day poverty lines, respectively. The relative poverty gap index was estimated at 42.7 and 10.5% respectively for the lower and upper poverty lines. Relative normalized mean poverty gap was estimated at 30.5 and 6.4%, respectively, for the lower and upper poverty lines. The percentage increase in poverty associated with OOP healthcare payments in Ghana is highest among households in the middle zone with an absolute increase estimated at 2.3% compared to the coastal and northern zones.

Conclusion

It is clear from the findings that without financial risk protection, households can be pushed into poverty due to OOP healthcare payments. Even relatively richer households are impoverished by OOP healthcare payments. This paper presents baseline indicators for evaluating the impact of Ghana’s national health insurance scheme on impoverishment due to OOP healthcare payments.

     

Household out-of-pocket medical expenditures and national health insurance in Taiwan: income and regional inequality

Background  

Unequal geographical distribution of medical care resources and insufficient healthcare coverage have been two long-standing problems with Taiwan's public health system. The implementation of National Health Insurance (NHI) attempted to mitigate the inequality in health care use. This study examines the degree to which Taiwan's National Health Insurance (NHI) has reduced out-of-pocket medical expenditures in households in different regions and varying levels of income.     

Analysis of the distributional impact of out-of-pocket health payments: evidence from a public health insurance program for the poor in Mexico

Many governments have health programs focused on improving health among the poor and these have an impact on out-of-pocket health payments made by individuals. Therefore, one of the objectives of these programs is to reach the poorest and reduce their out-of-pocket expenditure. In this paper we propose the distributional poverty impact approach to measure the poverty impact of out-of-pocket health payments of different health financing policies. This approach is comparable to the impoverishment methodology proposed by Wagstaff and van Doorslaer (2003) that compares poverty indices before and after out-of-pocket health payments. In order to escape the specification of a particular poverty index, we use the marginal dominance approach that uses non-intersecting curves and can rank poverty reducing health financing policies. We present an empirical application of the out-of-pocket health payments for an innovative social financing policy implemented in Mexico named Seguro Popular. The paper finds evidence that Seguro Popular program has a better distributional poverty impact when families face illness when compared to other poverty reducing policies. The empirical dominance approach uses data from Mexico in 2006 and considers international poverty standards of $2 per person per day.     

Issues in national health insurance.

Health insurance, by reducing net price to the consumer and increasing the opportunities for revenue to the provider, has profound effects, among other things, on the volume, content and distribution of services, their prices, and the capacity of providers to produce them. The magnitude and nature of these effects depend, partly, on the design of insurance benefits and, partly, on the nature of the health care system, particularly its current and potential capacity and the methods it uses to pay providers. Those who believe that the unique aim of insurance is to protect against unpredictable expenses attempt to suppress these effects, mainly by imposing financial disincentives to utilization which, in turn, reduce protection for those who need it most. Those who wish to reform the system have a broader range of objectives which include protective efficacy, cost control, quantitative adequacy, qualitative adequacy, efficiency of production, efficiency of allocation, equity, and redistribution of capacity. An analysis of the effects of insurance in the light of these objectives reveals favorable as well as unfavorable consequences. The provision of comprehensive benefits generates the necessity for a fundamental change in the organization of health services, if the advantages are to be fully realized and the disadvantages minimized.     

Examining unpriced risk heterogeneity in the Dutch health insurance market

A major challenge in regulated health insurance markets is to mitigate risk selection potential. Risk selection can occur in the presence of unpriced risk heterogeneity, which refers to predictable variation in health care spending not reflected in either premiums by insurers or risk equalization payments. This paper examines unpriced risk heterogeneity within risk groups distinguished by the sophisticated Dutch risk equalization model of 2016. Our strategy is to combine the administrative dataset used for estimation of the risk equalization model (n?=?16.9 million) with information derived from a large health survey (n?=?387k). The survey information allows for explaining and predicting residual spending of the risk equalization model. Based on the predicted residual spending, two metrics are used to indicate unpriced risk heterogeneity at the individual level and at the level of certain (risk) groups: the correlation coefficient between residual spending and predicted residual spending, and the mean absolute value of predicted residual spending. The analyses yield three main findings: (1) the health survey information is able to explain some residual spending of the risk equalization model, (2) unpriced risk heterogeneity exists both in morbidity and in non-morbidity groups, and (3) unpriced risk heterogeneity increases with predicted spending by the risk equalization model. These findings imply that the sophisticated Dutch risk equalization model does not completely remove unpriced risk heterogeneity. Further improvement of the model should focus on broadening and refining the current set of morbidity-based risk adjusters.