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Measuring the impact of health insurance with a correction for selection bias-a case study of Ecuador

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  • Hugh R. Waters

    (CRS-Peru, 209 W. Fayette St., Baltimore, USA)

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    Abstract

    This article develops and uses methodologies to evaluate the impact of publicly-financed health insurance programmes on the use of health care. Using univariate and bivariate probit estimation techniques, the study tests and corrects for endogeneity resulting from selection bias. Potential endogeneity arises from the choice to be insured, eligibility for insurance, and differences in individuals' health status. The setting for the study is the country of Ecuador. The General Health Insurance (GHI) programme, which primarily covers workers in the formal sector of the economy, is found to have a strong positive association with the use of curative health care after correcting for selection bias, but no significant effect on the use of preventive care. Individuals with severe illnesses who are eligible for GHI have a preference for private health care, and self-select out of the GHI programme. The Seguro Campesino Social (SSC) programme, directed at farming populations, has positive but insignificant associations with both curative and preventive care. Copyright © 1999 John Wiley & Sons, Ltd.

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    Bibliographic Info

    Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

    Volume (Year): 8 (1999)
    Issue (Month): 5 ()
    Pages: 473-483

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    Handle: RePEc:wly:hlthec:v:8:y:1999:i:5:p:473-483

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    Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749

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    1. Smith, Richard J & Blundell, Richard W, 1986. "An Exogeneity Test for a Simultaneous Equation Tobit Model with an Application to Labor Supply," Econometrica, Econometric Society, vol. 54(3), pages 679-85, May.
    2. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
    3. Kenneth Bollen & David Guilkey & Thomas Mroz, 1995. "Binary outcomes and endogenous explanatory variables: Tests and solutions with an application to the demand for contraceptive use in tunisia," Demography, Springer, vol. 32(1), pages 111-131, February.
    4. Manning, Willard G, et al, 1987. "Health Insurance and the Demand for Medical Care: Evidence from a Randomized Experiment," American Economic Review, American Economic Association, vol. 77(3), pages 251-77, June.
    5. Besley, Timothy & Coate, Stephen, 1991. "Public Provision of Private Goods and the Redistribution of Income," American Economic Review, American Economic Association, vol. 81(4), pages 979-84, September.
    6. Ribar, D., 1991. "Teenage Fertility and High Scholl Completion," Papers 10-91-2, Pennsylvania State - Department of Economics.
    7. Stiglitz, J. E., 1974. "The demand for education in public and private school systems," Journal of Public Economics, Elsevier, vol. 3(4), pages 349-385, November.
    8. Tim Besley & John Hall & Ian Preston, 1996. "The demand for private health insurance: do waiting lists matter?," IFS Working Papers W96/07, Institute for Fiscal Studies.
    9. Phelps, Charles E & Newhouse, Joseph P, 1974. "Coinsurance, the Price of Time, and the Demand for Medical Services," The Review of Economics and Statistics, MIT Press, vol. 56(3), pages 334-42, August.
    10. Le Grand, Julian, 1978. "The Distribution of Public Expenditure: The Case of Health Care," Economica, London School of Economics and Political Science, vol. 45(178), pages 125-42, May.
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    Cited by:
    1. Lien Nguyen & Unto Häkkinen & Matti Knuuttila & Marjo-Riitta Järvelin, 2008. "Should we brush twice a day? Determinants of dental health among young adults in Finland," Health Economics, John Wiley & Sons, Ltd., vol. 17(2), pages 267-286.
    2. Likwang Chen & Winnie Yip & Ming-Cheng Chang & Hui-Sheng Lin & Shyh-Dye Lee & Ya-Ling Chiu & Yu-Hsuan Lin, 2007. "The effects of Taiwan's National Health Insurance on access and health status of the elderly," Health Economics, John Wiley & Sons, Ltd., vol. 16(3), pages 223-242.
    3. Weiwei Feng & Wei Zhou & J.S. Butler & Brenda M. Booth & Michael T. French, 2001. "The impact of problem drinking on employment," Health Economics, John Wiley & Sons, Ltd., vol. 10(6), pages 509-521.
    4. Jutting, Johannes P., 2004. "Do Community-based Health Insurance Schemes Improve Poor People's Access to Health Care? Evidence From Rural Senegal," World Development, Elsevier, vol. 32(2), pages 273-288, February.
    5. Jennifer Roberts & Paul Mosley & Syed Abdul Hammid, 2010. "Evaluating the Health Effects of Micro Health Insurance Placement: Evidence from Bangladesh," Working Papers 2010009, The University of Sheffield, Department of Economics, revised Apr 2010.
    6. Matthew Jowett & Anil Deolalikar & Peter Martinsson, 2004. "Health insurance and treatment seeking behaviour: evidence from a low-income country," Health Economics, John Wiley & Sons, Ltd., vol. 13(9), pages 845-857.
    7. Antonio J. Trujillo, 2003. "Medical care use and selection in a social health insurance with an equalization fund: evidence from Colombia," Health Economics, John Wiley & Sons, Ltd., vol. 12(3), pages 231-246.
    8. Adam Wagstaff, 2010. "Estimating health insurance impacts under unobserved heterogeneity: the case of Vietnam's health care fund for the poor," Health Economics, John Wiley & Sons, Ltd., vol. 19(2), pages 189-208.
    9. Andrés Ramírez Hassan & Johnatan Cardona Jimenez & Ramiro Cadavid Montoya, 2011. "The impact of subsidized health insurance on the poor in Colombia: Evaluating the case of Medellin," DOCUMENTOS DE TRABAJO CIEF 010602, UNIVERSIDAD EAFIT.
    10. Dekker, Marleen & Wilms, Annegien, 2010. "Health Insurance and Other Risk-Coping Strategies in Uganda: The Case of Microcare Insurance Ltd," World Development, Elsevier, vol. 38(3), pages 369-378, March.
    11. Hugh R. Waters & Laurel E. Hatt & Robert E. Black, 2008. "The role of private providers in treating child diarrhoea in Latin America," Health Economics, John Wiley & Sons, Ltd., vol. 17(1), pages 21-29.
    12. Marty Makinen & Stephanie Sealy & Ricardo A. Bitrán & Sam Adjei & Rodrigo Muñoz, 2011. "Private Health Sector Assessment in Ghana," World Bank Publications, The World Bank, number 5956, March.
    13. Matthew Jowett, 2004. "Theoretical insights into the development of health insurance in low-income countries," Working Papers 188chedp, Centre for Health Economics, University of York.

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