IDEAS home Printed from https://ideas.repec.org/a/bla/ecorec/v81y2005i254p262-272.html
   My bibliography  Save this article

Effects of Recent Carrot‐and‐Stick Policy Initiatives on Private Health Insurance Coverage in Australia

Author

Listed:
  • ALFONS PALANGKARAYA
  • JONGSAY YONG

Abstract

The Australian government implemented a sequence of new policies during 1997–2000 and raised the take‐up rate of private health insurance (PHI) by 35 per cent. Because they were implemented sequentially, their individual effectiveness is not quite clear. We isolate the effects of Lifetime Health Cover (LHC) introduced at the last stage of the sequence using a counterfactual analysis of PHI demand with and without the new policies. Unlike earlier studies which attributed the bulk of the increase in PHI coverage to LHC, we find LHC may only account for as low as 42 per cent and no more than 75 per cent of the increase.

Suggested Citation

  • Alfons Palangkaraya & Jongsay Yong, 2005. "Effects of Recent Carrot‐and‐Stick Policy Initiatives on Private Health Insurance Coverage in Australia," The Economic Record, The Economic Society of Australia, vol. 81(254), pages 262-272, September.
    • Handle: RePEc:bla:ecorec:v:81:y:2005:i:254:p:262-272
    DOI: 10.1111/j.1475-4932.2005.00260.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1475-4932.2005.00260.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1475-4932.2005.00260.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Ángel Marcos Vera‐Hernández, 1999. "Duplicate coverage and demand for health care. The case of Catalonia," Health Economics, John Wiley & Sons, Ltd., vol. 8(7), pages 579-598, November.
    2. Alfons Palangkaraya & Jongsay Yong, 2007. "How effective is “lifetime health cover” in raising private health insurance coverage in Australia? An assessment using regression discontinuity," Applied Economics, Taylor & Francis Journals, vol. 39(11), pages 1361-1374.
    3. H.E. Frech Iii & Sandra Hopkins & Garry Macdonald, 2003. "The Australian Private Health Insurance Boom: Was It Subsidies Or Liberalised Regulation?," Economic Papers, The Economic Society of Australia, vol. 22(1), pages 58-64, March.
    4. Fairlie, Robert W., 2003. "An Extension of the Blinder-Oaxaca Decomposition Technique to Logit and Probit Models," Center Discussion Papers 28425, Yale University, Economic Growth Center.
    5. Cameron, A. Colin & Trivedi, Pravin K., 1991. "The role of income and health risk in the choice of health insurance : Evidence from Australia," Journal of Public Economics, Elsevier, vol. 45(1), pages 1-28, June.
    6. Garry F. Barrett & Robert Conlon, 2003. "Adverse Selection and the Decline in Private Health Insurance Coverage in Australia: 1989–95," The Economic Record, The Economic Society of Australia, vol. 79(246), pages 279-296, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Nathan Kettlewell & Yuting Zhang, 2024. "Age penalties and take‐up of private health insurance," Health Economics, John Wiley & Sons, Ltd., vol. 33(4), pages 636-651, April.
    2. Yicheng Kang & Xiaodong Gong & Jiti Gao & Peihua Qiu, 2016. "Error-in-Variables Jump Regression Using Local Clustering," Monash Econometrics and Business Statistics Working Papers 13/16, Monash University, Department of Econometrics and Business Statistics.
    3. Stephanie Knox & Elizabeth Savage & Denzil Fiebig & Vineta Salale, 2007. "Joiners, leavers, stayers and abstainers: Private health insurance choices in Australia, CHERE Working Paper 2007/8," Working Papers 2007/8, CHERE, University of Technology, Sydney.
    4. Alfons Palangkaraya & Jongsay Yong & Elizabeth Webster & Peter Dawkins, 2009. "The income distributive implications of recent private health insurance policy reforms in Australia," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 10(2), pages 135-148, May.
    5. Gong, Xiaodong & Gao, Jiti, 2015. "Nonparametric Kernel Estimation of the Impact of Tax Policy on the Demand for Private Health Insurance in Australia," IZA Discussion Papers 9265, Institute of Labor Economics (IZA).
    6. Alex Robson & Henry Ergas & Francesco Paolucci, 2011. "The Analytics of the Australian Private Health Insurance Rebate and the Medicare Levy Surcharge," Agenda - A Journal of Policy Analysis and Reform, Australian National University, College of Business and Economics, School of Economics, vol. 18(2), pages 27-48.
    7. Vijaya Sundararajan & Ou Yang & Jongsay Yong, 2023. "Socioeconomic status and access to care in a universal healthcare system: The case of acute myocardial infarction in Australia," Melbourne Institute Working Paper Series wp2023n10, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    8. Moorin, Rachael Elizabeth & Holman, Cashel D'Arcy James, 2008. "The cost of in-patient care in Western Australia in the last years of life: A population-based data linkage study," Health Policy, Elsevier, vol. 85(3), pages 380-390, March.
    9. Keegan, Conor, 2020. "The introduction of lifetime community rating in the Irish private health insurance market: Effects on coverage and plan choice," Social Science & Medicine, Elsevier, vol. 255(C).
    10. Sundararajan, Vijaya & Yang, Ou & Yong, Jongsay, 2023. "Socioeconomic status and access to care in a universal health care system: The case of acute myocardial infarction in Australia," Journal of Economic Behavior & Organization, Elsevier, vol. 215(C), pages 1-25.
    11. Nathan Kettlewell, 2019. "Utilization and Selection in an Ancillaries Health Insurance Market," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 86(4), pages 989-1017, December.
    12. Jongsay Yong & Alfons Palangkaraya & Elizabeth Webster & Peter Dawkins, 2006. "The Income Distributive Implications of Recent Private Health Insurance Policies in Australia," Melbourne Institute Working Paper Series wp2006n02, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    13. Ha Trong Nguyen & Huong Thu Le & Luke Connelly & Francis Mitrou, 2023. "Accuracy of self‐reported private health insurance coverage," Health Economics, John Wiley & Sons, Ltd., vol. 32(12), pages 2709-2729, December.
    14. Buchmueller, Thomas C. & Cheng, Terence C. & Pham, Ngoc T.A. & Staub, Kevin E., 2021. "The effect of income-based mandates on the demand for private hospital insurance and its dynamics," Journal of Health Economics, Elsevier, vol. 75(C).
    15. Randall Ellis & Elizabeth Savage, 2008. "Run for cover now or later? The impact of premiums, threats and deadlines on private health insurance in Australia," International Journal of Health Economics and Management, Springer, vol. 8(4), pages 257-277, December.
    16. Kettlewell, Nathan & Zhang, Yuting, 2024. "Financial incentives and private health insurance demand on the extensive and intensive margins," Journal of Health Economics, Elsevier, vol. 94(C).
    17. Kettlewell, Nathan & Zhang, Yuting, 2023. "Financial Incentives and Private Health Insurance Demand on the Extensive and Intensive Margins," IZA Discussion Papers 16248, Institute of Labor Economics (IZA).
    18. Denise Doiron & Nathan Kettlewell, 2020. "Family formation and the demand for health insurance," Health Economics, John Wiley & Sons, Ltd., vol. 29(4), pages 523-533, April.
    19. Denise Doiron & Nathan Kettlewell, 2018. "The Effect of Health Insurance on the Substitution between Public and Private Hospital Care," The Economic Record, The Economic Society of Australia, vol. 94(305), pages 135-154, June.
    20. Thomas Buchmueller, 2008. "Community Rating, Entry-Age Rating and Adverse Selection in Private Health Insurance in Australia*," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 33(4), pages 588-609, October.
    21. Judith Liu & Yuting Zhang, 2023. "Elderly responses to private health insurance incentives: Evidence from Australia," Health Economics, John Wiley & Sons, Ltd., vol. 32(12), pages 2730-2744, December.
    22. Moorin, Rachael Elizabeth & Holman, Cashel D'Arcy James, 2007. "Modelling changes in the determinants of PHI utilisation in Western Australia across five health care policy eras between 1981 and 2001," Health Policy, Elsevier, vol. 81(2-3), pages 183-194, May.
    23. Roger Carrington & Tim Coelli & D.S. Prasada Rao, 2011. "Australian Private Health Insurance Productivity Growth: Is there Scope to Limit Premium Increases?," The Economic Record, The Economic Society of Australia, vol. 87(276), pages 125-139, March.
    24. Ou Yang & Jongsay Yong & Yuting Zhang, 2024. "Effects of private health insurance on waiting time in public hospitals," Health Economics, John Wiley & Sons, Ltd., vol. 33(6), pages 1192-1210, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Thomas Buchmueller, 2008. "Community Rating, Entry-Age Rating and Adverse Selection in Private Health Insurance in Australia*," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 33(4), pages 588-609, October.
    2. Keegan, Conor, 2020. "The introduction of lifetime community rating in the Irish private health insurance market: Effects on coverage and plan choice," Social Science & Medicine, Elsevier, vol. 255(C).
    3. Cheng, Terence Chai, 2014. "Measuring the effects of reducing subsidies for private insurance on public expenditure for health care," Journal of Health Economics, Elsevier, vol. 33(C), pages 159-179.
    4. Alex Robson & Henry Ergas & Francesco Paolucci, 2011. "The Analytics of the Australian Private Health Insurance Rebate and the Medicare Levy Surcharge," Agenda - A Journal of Policy Analysis and Reform, Australian National University, College of Business and Economics, School of Economics, vol. 18(2), pages 27-48.
    5. Judith Liu & Yuting Zhang, 2023. "Elderly responses to private health insurance incentives: Evidence from Australia," Health Economics, John Wiley & Sons, Ltd., vol. 32(12), pages 2730-2744, December.
    6. López Nicolás, Ángel & Vera-Hernández, Marcos, 2008. "Are tax subsidies for private medical insurance self-financing? Evidence from a microsimulation model," Journal of Health Economics, Elsevier, vol. 27(5), pages 1285-1298, September.
    7. Terence Chai Cheng, 2011. "Measuring the Effects of Removing Subsidies for Private Insurance on Public Expenditure for Health Care," Melbourne Institute Working Paper Series wp2011n26, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    8. Sandra Hopkins & Michael P. Kidd & Aydogan Ulker, 2013. "Private Health Insurance Status and Utilisation of Dental Services in Australia," The Economic Record, The Economic Society of Australia, vol. 89(285), pages 194-206, June.
    9. Jongsay Yong & Alfons Palangkaraya, 2004. "Discerning the Effects of Recent Private Health Insurance Policy Changes in Australia," Econometric Society 2004 Australasian Meetings 183, Econometric Society.
    10. Preety Srivastava & Gang Chen & Anthony Harris, 2017. "Oral Health, Dental Insurance and Dental Service use in Australia," Health Economics, John Wiley & Sons, Ltd., vol. 26(1), pages 35-53, January.
    11. Alfons Palangkaraya & Jongsay Yong & Elizabeth Webster & Peter Dawkins, 2009. "The income distributive implications of recent private health insurance policy reforms in Australia," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 10(2), pages 135-148, May.
    12. LIU Yang & HAGIWARA Risa, 2023. "Female Labor Force Participation in Japan: An epidemiological approach using native and immigrant data," Discussion papers 23023, Research Institute of Economy, Trade and Industry (RIETI).
    13. Peter Zweifel & H. E. Frech, 2016. "Why ‘Optimal’ Payment for Healthcare Providers Can Never be Optimal Under Community Rating," Applied Health Economics and Health Policy, Springer, vol. 14(1), pages 9-20, February.
    14. Erik Schokkaert & Tom Van Ourti & Diana De Graeve & Ann Lecluyse & Carine Van de Voorde, 2010. "Supplemental health insurance and equality of access in Belgium," Health Economics, John Wiley & Sons, Ltd., vol. 19(4), pages 377-395, April.
    15. Dorrit Posel & Daniela Casale, 2013. "The relationship between sex ratios and marriage rates in South Africa," Applied Economics, Taylor & Francis Journals, vol. 45(5), pages 663-676, February.
    16. Thomas C. Buchmueller & Agnès Couffinhal & Michel Grignon & Marc Perronnin, 2004. "Access to physician services: does supplemental insurance matter? Evidence from France," Health Economics, John Wiley & Sons, Ltd., vol. 13(7), pages 669-687, July.
    17. Amelie F. Constant & Martin Kahanec & Klaus F. Zimmermann, 2011. "The Russian-Ukrainian Political Divide," Eastern European Economics, Taylor & Francis Journals, vol. 49(6), pages 97-109, November.
    18. Brian E. Whitacre & Bradford F. Mills, 2007. "Infrastructure and the Rural—urban Divide in High-speed Residential Internet Access," International Regional Science Review, , vol. 30(3), pages 249-273, July.
    19. Bhaumik, Sumon Kumar & Gang, Ira N. & Yun, Myeong-Su, 2006. "Ethnic conflict and economic disparity: Serbians and Albanians in Kosovo," Journal of Comparative Economics, Elsevier, vol. 34(4), pages 754-773, December.
    20. Stephan Klasen & Janneke Pieters, 2015. "What Explains the Stagnation of Female Labor Force Participation in Urban India?," The World Bank Economic Review, World Bank, vol. 29(3), pages 449-478.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:ecorec:v:81:y:2005:i:254:p:262-272. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/esausea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.