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Does the reason for buying health insurance influence behaviour? CHERE Working Paper 2006/1

Author

Listed:
  • Denzil Fiebig

    () (University of NSW)

  • Elizabeth Savage

    () (CHERE, University of Technology, Sydney)

  • Rosalie Viney

    () (CHERE, University of Technology, Sydney)

Abstract

The inter-relationship between private health insurance cover and hospital utilisation is complex. The current policy approach in Australia appears to rely on relatively simple models of the relationships between health insurance coverage, and public and private hospital use. There is considerable evidence of unexplained heterogeneity among the privately insured population. Heterogeneity of preferences is likely to be important not just in determining the uptake of private health insurance, but also the impact of changes in private health insurance on the use of private treatment. A number of studies have used attitudinal variables to model heterogeneity of preferences in other contexts. This study uses the 2001 ABS National Health Survey to identify ?types? among the insured population using their stated reasons for purchasing private health insurance. We find that insurance type is significantly associated with hospital utilisation, particularly the probability of being admitted as a public or private patient. We also find that the government?s insurance incentives were more attractive to particular types of the insured population. This has implications for the effectiveness of the insurance incentives and for the design of policies that aim to reduce pressure on the public hospital system.

Suggested Citation

  • Denzil Fiebig & Elizabeth Savage & Rosalie Viney, 2006. "Does the reason for buying health insurance influence behaviour? CHERE Working Paper 2006/1," Working Papers 2006/1, CHERE, University of Technology, Sydney.
  • Handle: RePEc:her:chewps:2006/1
    as

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    File URL: http://www.chere.uts.edu.au/pdf/wp2006_1.pdf
    File Function: First version, 2006
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    References listed on IDEAS

    as
    1. Denise Doiron & Glenn Jones & Elizabeth Savage, 2006. "Healthy, wealthy and insured? The role of self-assessed health in the demand for private health insurance, CHERE Working Paper 2006/2," Working Papers 2006/2, CHERE, University of Technology, Sydney.
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    3. Propper, Carol, 1993. "Constrained choice sets in the U.K. demand for private medical insurance," Journal of Public Economics, Elsevier, vol. 51(3), pages 287-307, July.
    4. Denise Doiron & Glenn Jones & Elizabeth Savage, 2008. "Healthy, wealthy and insured? The role of self-assessed health in the demand for private health insurance," Health Economics, John Wiley & Sons, Ltd., vol. 17(3), pages 317-334.
    5. Ika Darnhofer & Walter Schneeberger & Bernhard Freyer, 2005. "Converting or not converting to organic farming in Austria:Farmer types and their rationale," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 22(1), pages 39-52, March.
    6. Hersch, Joni & Pickton, Todd S, 1995. "Risk-Taking Activities and Heterogeneity of Job-Risk Tradeoffs," Journal of Risk and Uncertainty, Springer, vol. 11(3), pages 205-217, December.
    7. Jane Hall & Richard De Abreu Lourenco & Rosalie Viney, 1999. "Carrots and sticks-the fall and fall of private health insurance in Australia," Health Economics, John Wiley & Sons, Ltd., vol. 8(8), pages 653-660.
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    13. Randall P. Ellis & Elizabeth Savage, 2005. "Where do you run after you run for cover? The impact on premium changes on the characteristics of the privately insured in Australia," Boston University - Department of Economics - Working Papers Series WP2005-020, Boston University - Department of Economics.
    14. Harris, Katherine M. & Keane, Michael P., 1998. "A model of health plan choice:: Inferring preferences and perceptions from a combination of revealed preference and attitudinal data," Journal of Econometrics, Elsevier, vol. 89(1-2), pages 131-157, November.
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    Citations

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    Cited by:

    1. 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.
    2. repec:taf:applec:v:49:y:2017:i:4:p:361-375 is not listed on IDEAS
    3. Meliyanni Johar & Glenn Jones & Michael Keane & Elizabeth Savage & Olena Stavrunova, 2010. "Waiting times and the decision to buy private health insurance. CHERE Working Paper 2010/9," Working Papers 2010/9, CHERE, University of Technology, Sydney.
    4. Damien S. Eldridge & Ilke Onur & Malathi Velamuri, 2017. "The impact of private hospital insurance on the utilization of hospital care in Australia," Applied Economics, Taylor & Francis Journals, vol. 49(1), pages 78-95, January.
    5. Denise Doiron & Glenn Jones & Elizabeth Savage, 2008. "Healthy, wealthy and insured? The role of self-assessed health in the demand for private health insurance," Health Economics, John Wiley & Sons, Ltd., vol. 17(3), pages 317-334.
    6. World Bank, 2015. "Bulgaria Health Financing," World Bank Other Operational Studies 22964, The World Bank.

    More about this item

    Keywords

    Private health insurance; health policy; Australia;

    JEL classification:

    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets

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