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Social health insurance reexamined

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Author Info
Wagstaff, Adam

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Abstract

Social health insurance (SHI) is enjoying something of a revival in parts of the developing world. Many countries that have in the past relied largely on tax finance (and out-of-pocketpayments) have introduced SHI, or are thinking about doing so. And countries with SHI already in place are making vigorous efforts to extend coverage to the informal sector. Ironically, this revival is occurring at a time when the traditional SHI countries in Europe have either already reduced payroll financing in favor of general revenues, or are in the process of doing so. This paper examines how SHI fares in health care delivery, revenue collection, covering the formal sector, and its impacts on the labor market. It argues that SHI does not necessarily deliver good quality care at a low cost, partly because of poor regulation of SHI purchasers. It suggests that the costs of collecting revenues can be substantial, even in the formal sector where nonenrollment and evasion are commonplace, and that while SHI can cover the formal sector and the poor relatively easily, it fares badly in terms of covering the nonpoor informal sector workers until the economy has reached a high level of economic development. The paper also argues that SHI can have negative labor market effects.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4111.

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Date of creation: 01 Jan 2007
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Handle: RePEc:wbk:wbrwps:4111

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Related research
Keywords: Public Sector Economics&Finance; Labor Markets; Health Economics&Finance; Health Systems Development&Reform; Health Monitoring&Evaluation;

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  1. Lewis, Maureen & Eskeland, Gunnar & Traa-Valerezo, Ximena, 2004. "Primary health care in practice: is it effective?," Health Policy, Elsevier, vol. 70(3), pages 303-325, December. [Downloadable!] (restricted)
  2. Bauer, Thomas & Riphahn, Regina T, 2002. "Employment Effects of Payroll Taxes--An Empirical Test for Germany," Applied Economics, Taylor and Francis Journals, vol. 34(7), pages 865-76, May. [Downloadable!] (restricted)
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  3. Stephen Nickell, 2004. "Employment and Taxes," CEP Discussion Papers dp0634, Centre for Economic Performance, LSE. [Downloadable!]
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  4. Reinikka, Ritva & Svensson, Jakob, 2004. "Working for God?," CEPR Discussion Papers 4214, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  5. van Doorslaer, Eddy & Wagstaff, Adam & van der Burg, Hattem & Christiansen, Terkel & Citoni, Guido & Di Biase, Rita & Gerdtham, Ulf-G. & Gerfin, Mike & Gross, Lorna & Hakinnen, Unto, 1999. "The redistributive effect of health care finance in twelve OECD countries," Journal of Health Economics, Elsevier, vol. 18(3), pages 291-313, June. [Downloadable!] (restricted)
  6. Wagstaff, Adam & van Doorslaer, Eddy, 1992. "Equity in the finance of health care: Some international comparisons," Journal of Health Economics, Elsevier, vol. 11(4), pages 361-387, December. [Downloadable!] (restricted)
  7. Elizabeth Docteur & Howard Oxley, 2003. "Health-Care Systems: Lessons from the Reform Experience," OECD Economics Department Working Papers 374, OECD, Economics Department. [Downloadable!]
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  8. Wagstaff, Adam & Lindelow, Magnus & Gao Jun & Xu Ling & Qian Juncheng, 2007. "Extending health insurance to the rural population : an impact evaluation of China's new cooperative medical scheme," Policy Research Working Paper Series 4150, The World Bank. [Downloadable!]
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  9. Kugler, Adriana & Kugler, Maurice, 2003. "The Labor Market Effects of Payroll Taxes in a Middle-Income Country: Evidence from Colombia," IZA Discussion Papers 852, Institute for the Study of Labor (IZA). [Downloadable!]
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  10. Alejandro Gaviria & Carlos Medina & Carolina Mejía, 2006. "Evaluating The Impact Of Health Care Reform In Colombia: From Theory To Practice," DOCUMENTOS CEDE 002647, UNIVERSIDAD DE LOS ANDES-CEDE. [Downloadable!]
  11. Wagstaff, Adam, 2007. "Health insurance for the poor : initial impacts of Vietnam's health care fund for the poor," Policy Research Working Paper Series 4134, The World Bank. [Downloadable!]
  12. Adam Wagstaff, 2007. "Health systems in East Asia: what can developing countries learn from Japan and the Asian Tigers?," Health Economics, John Wiley & Sons, Ltd., vol. 16(5), pages 441-456. [Downloadable!]
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  13. Summers, Lawrence H, 1989. "Some Simple Economics of Mandated Benefits," American Economic Review, American Economic Association, vol. 79(2), pages 177-83, May. [Downloadable!] (restricted)
  14. Nickell, Stephen, 1997. "Unemployment and Labor Market Rigidities: Europe versus North America," Journal of Economic Perspectives, American Economic Association, vol. 11(3), pages 55-74, Summer. [Downloadable!] (restricted)
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