Does Health Insurance Decrease Health Expenditure Risk in Developing Countries? The Case of China
AbstractWe make use of panel data from the China Health and Nutrition Survey between 1991 and 2006 to investigate whether health insurance increases out-of-pocket (OOP) health expenditure risk. We find that health insurance increases the probability of catastrophic OOP health expenditures using a series of Probit models. We then use two-part as well as sample selection models to account for selection on unobservable variables and find that although the probability of positive OOP health expenditures increases with the availability of health insurance, the actual level of OOP health expenditures decreases. More specifically, we find that for a per- son with positive OOP health expenditures, having health insurance reduces the level of OOP expenses by 12.56 percent while controlling for selection effects.
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Bibliographic InfoPaper provided by Towson University, Department of Economics in its series Working Papers with number 2011-04.
Length: 32 pages
Date of creation: Apr 2011
Date of revision: Feb 2012
health insurance; exposure to health risk; health care in China; out-of-pocket health expenditure in China; two-part model; bivariate sample selection model; Heckman two- step estimator; China Health and Nutrition Survey (CHNS).;
Find related papers by JEL classification:
- I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
- C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Longitudinal Data; Spatial Time Series
- C34 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Truncated and Censored Models; Switching Regression Models
This paper has been announced in the following NEP Reports:
- NEP-AGR-2011-04-30 (Agricultural Economics)
- NEP-ALL-2011-04-30 (All new papers)
- NEP-DEV-2011-04-30 (Development)
- NEP-HEA-2011-04-30 (Health Economics)
- NEP-IAS-2011-04-30 (Insurance Economics)
- NEP-MFD-2011-04-30 (Microfinance)
- NEP-TRA-2011-04-30 (Transition Economics)
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