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Self-selection and moral hazard in Chilean health insurance

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  • Sapelli, Claudio
  • Vial, Bernardita

Abstract

In Chile, dependant workers are mandated to purchase health insurance and they can chose between one public provider and several private providers. Here, we analyze the relation between utilization and the choice of either private or public insurance. Independent workers, however, are not mandated. In this case, we analyze the relationship between utilization and the decision to purchase insurance. The results show adverse selection against insurance companies for independent workers and against FONASA for dependant workers. Moral hazard is negligible in the case of hospitalization. Regarding medical visits, over consumption is quantitatively important and statistically significant in all cases (against insurance for independents; against public and private insurance in the case of dependant workers).
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Suggested Citation

  • Sapelli, Claudio & Vial, Bernardita, 2003. "Self-selection and moral hazard in Chilean health insurance," Journal of Health Economics, Elsevier, vol. 22(3), pages 459-476, May.
    • Handle: RePEc:eee:jhecon:v:22:y:2003:i:3:p:459-476
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    References listed on IDEAS

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    1. Claudio Sapelli & Bernardita Vial, 1998. "Utilización de Prestaciones de Salud en Chile: ¿Es Diferente entre Grupos de Ingreso?," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 35(106), pages 343-382.
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    3. Heckman, James J, 1978. "Dummy Endogenous Variables in a Simultaneous Equation System," Econometrica, Econometric Society, vol. 46(4), pages 931-959, July.
    4. David M. Cutler & Richard J. Zeckhauser, 1998. "Adverse Selection in Health Insurance," NBER Chapters, in: Frontiers in Health Policy Research, Volume 1, pages 1-32, National Bureau of Economic Research, Inc.
    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. Claudio Sapelli & Arístides Torche, 1998. "El Seguro Previsional de Salud: Determinantes de la Elección entre Seguro Público y Privado, 1990-1994," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 35(106), pages 383-406.
    7. David Cutler, 1994. "Market Failure in Small Group Health Insurance," NBER Working Papers 4879, National Bureau of Economic Research, Inc.
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    More about this item

    JEL classification:

    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies

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