Health insurance reform in four Latin American countries : theory and practice
AbstractThe author examines public economics rationales for public intervention in health insurance markets, draws on the literature of organizational design to examine alternative intervention strategies, and considers health insurance reforms in four Latin American countries -- Argentina, Brazil, Chile, and Colombia -- in light of the theoretical literature. Equity has been the main reason for large-scale public intervention in the health insurance sector, despite the well-known failures of insurance and health care markets associated with imperfect information. Recent reforms have sought less to make private markets more efficient than to make public provision more efficient, sometimes by altering the focus and function of existing institutions (such as the obras sociales in Argentina) or by encouraging the growth of new ones (such as Chile's ISAPREs). Generally, these four Latin American countries have reformed the ways insurance and care are organized and delivered, have tried to extend formal coverage to previously marginalized groups, and have tried to finance this extension fairly. Colombia instituted an implicit two-tiered voucher scheme financed through a proportional wage tax. Chile's financing mechanism is similar but the distribution of benefits is less progressive, so the net effect is less redistributive. Argentina's remodeled obras system went halfway: the financing base is similar and there is some implicit redistribution from richer to poorer obras, but the quality of insurance increases with income. On the face of it, Brazil's health insurance system is less redistributive than those of the other three countries, as no tax is earmarked for financing health insurance. But taxes paid by higher-income taxpayers are not reduced when they choose private insurance, highlighting the problem of examining the health sector independent of the general tax and transfer system.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by The World Bank in its series Policy Research Working Paper Series with number 2492.
Date of creation: 30 Nov 2000
Date of revision:
Health Economics&Finance; Environmental Economics&Policies; Insurance&Risk Mitigation; Insurance Law; Economic Theory&Research;
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Bengt Holmstrom, 1979.
"Moral Hazard and Observability,"
Bell Journal of Economics, The RAND Corporation,
The RAND Corporation, vol. 10(1), pages 74-91, Spring.
- Bengt Holmstrom, 1997. "Moral Hazard and Observability," Levine's Working Paper Archive 1205, David K. Levine.
- HOLMSTROM, Bengt, . "Moral hazard and observability," CORE Discussion Papers RP, UniversitÃ© catholique de Louvain, Center for Operations Research and Econometrics (CORE) -379, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Tirole, Jean, 1994.
"The Internal Organization of Government,"
Oxford Economic Papers,
Oxford University Press, vol. 46(1), pages 1-29, January.
- Tirole, J., 1993. "The Internal Organization of Government," Working papers, Massachusetts Institute of Technology (MIT), Department of Economics 93-11, Massachusetts Institute of Technology (MIT), Department of Economics.
- Le Grand, Julian, 1991. "Quasi-markets and Social Policy," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 101(408), pages 1256-67, September.
- Cutler David M. & Zeckhauser Richard J., 1998.
"Adverse Selection in Health Insurance,"
Forum for Health Economics & Policy, De Gruyter,
De Gruyter, vol. 1(1), pages 1-33, January.
- Miguel Gouveia, 1997.
"Majority rule and the public provision of a private good,"
Public Choice, Springer,
Springer, vol. 93(3), pages 221-244, December.
- Gouveia, Miguel, 1997. " Majority Rule and the Public Provision of a Private Good," Public Choice, Springer, Springer, vol. 93(3-4), pages 221-44, December.
- David M. Cutler & Sarah J. Reber, 1998.
"Paying For Health Insurance: The Trade-Off Between Competition And Adverse Selection,"
The Quarterly Journal of Economics, MIT Press,
MIT Press, vol. 113(2), pages 433-466, May.
- David M. Cutler & Sarah Reber, 1996. "Paying for Health Insurance: The Tradeoff between Competition and Adverse Selection," NBER Working Papers 5796, National Bureau of Economic Research, Inc.
- Mathias Dewatripont & Jean Tirole, 1994. "The prudential regulation of banks," ULB Institutional Repository 2013/9539, ULB -- Universite Libre de Bruxelles.
- Dixit, Avinash, 1997. "Power of Incentives in Private versus Public Organizations," American Economic Review, American Economic Association, American Economic Association, vol. 87(2), pages 378-82, May.
- Andrei Shleifer, 1985. "A Theory of Yardstick Competition," RAND Journal of Economics, The RAND Corporation, vol. 16(3), pages 319-327, Autumn.
- Hammer, Jeffrey S., 1996.
"Economic analysis for health projects,"
Policy Research Working Paper Series
1611, The World Bank.
- Chalkley, M. & Malcomson, J.M., 2001.
"Cost Sharing in Health Service Provision: An Empirical Assessment of Cost Savings,"
Economics Series Working Papers
9969, University of Oxford, Department of Economics.
- Chalkley, Martin & Malcomson, James M., 2002. "Cost sharing in health service provision: an empirical assessment of cost savings," Journal of Public Economics, Elsevier, Elsevier, vol. 84(2), pages 219-249, May.
- Jack, W., 1998. "Controlling Risk Selction Incentives when Health Insurance Contracts are Endogenous," Papers, Australian National University - Department of Economics 341, Australian National University - Department of Economics.
- Akerlof, George A, 1970. "The Market for 'Lemons': Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 84(3), pages 488-500, August.
- Uri Ronnen, 1991. "Minimum Quality Standards, Fixed Costs, and Competition," RAND Journal of Economics, The RAND Corporation, vol. 22(4), pages 490-504, Winter.
- Rubinstein, Ariel & Yaari, Menahem E., 1983. "Repeated insurance contracts and moral hazard," Journal of Economic Theory, Elsevier, Elsevier, vol. 30(1), pages 74-97, June.
- Wilson, Charles, 1977. "A model of insurance markets with incomplete information," Journal of Economic Theory, Elsevier, Elsevier, vol. 16(2), pages 167-207, December.
- Zeckhauser, Richard, 1970. "Medical insurance: A case study of the tradeoff between risk spreading and appropriate incentives," Journal of Economic Theory, Elsevier, Elsevier, vol. 2(1), pages 10-26, March.
- Feldstein, Martin S, 1973. "The Welfare Loss of Excess Health Insurance," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 81(2), pages 251-80, Part I, M.
- Rothschild, Michael & Stiglitz, Joseph E, 1976. "Equilibrium in Competitive Insurance Markets: An Essay on the Economics of Imperfect Information," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 90(4), pages 630-49, November.
- Martha Bottia & Lina Cardona & Carlos Medina, 2008.
"Bondades y Limitaciones de la Focalización con Proxy Means Tests: El Caso del Sisben en Colombia,"
BORRADORES DE ECONOMIA
005185, BANCO DE LA REPÚBLICA.
- Martha Bottia & Lina Cardona & Carlos Medina, . "Bondades y Limitaciones de la Focalización con Proxy Means Tests: El Caso del Sisben en Colombia," Borradores de Economia 539, Banco de la Republica de Colombia.
- Ronald Eduardo Gómez Suárez, 2007. "Cream-Skimming And Risk Adjustment in Colombian Health Insurance System:: The Public Insurer Case," ARCHIVOS DE ECONOMÃA 004295, DEPARTAMENTO NACIONAL DE PLANEACIÓN.
- Bosch, Mariano & Goni, Edwin & Maloney, William F., 2007.
"The Determinants of Rising Informality in Brazil: Evidence from Gross Worker Flows,"
IZA Discussion Papers
2970, Institute for the Study of Labor (IZA).
- Bosch, Mariano & Goni, Edwin & Maloney, William, 2007. "The determinants of rising informality in Brazil : Evidence from gross worker flows," Policy Research Working Paper Series 4375, The World Bank.
- Tabor, Steven R., 2005. "Community-based health insurance and social protection policy," Social Protection Discussion Papers 32545, The World Bank.
- Martha Bottia & Lina Cardona-Sosa & Carlos Medina, 2012. "El SISBEN como mecanismo de focalización individual del régimen subsidiado en salud en Colombia: ventajas y limitaciones," REVISTA DE ECONOMÍA DEL ROSARIO, UNIVERSIDAD DEL ROSARIO.
- Bosch, Mariano & Goñi-Pacchioni, Edwin & Maloney, William, 2012. "Trade liberalization, labor reforms and formal–informal employment dynamics," Labour Economics, Elsevier, Elsevier, vol. 19(5), pages 653-667.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roula I. Yazigi).
If references are entirely missing, you can add them using this form.