The role and uptake of private health insurance in different health care systems: are there lessons for developing countries?

Social and national health insurance schemes are being introduced in many developing countries in moving towards universal health care. However, gaps in coverage are common and can only be met by out-of-pocket payments, general taxation, or private health insurance (PHI). This study provides an overview of PHI in different health care systems and discusses factors that affect its uptake and equity.  A representative sample of countries was identified (United States, United Kingdom, The Netherlands, France, Australia, and Latvia) that illustrates the principal forms and roles of PHI. Literature describing each country’s health care system was used to summarize how PHI is utilized and the factors that affect its uptake and equity.  In the United States, PHI is a primary source of funding in conjunction with tax-based programs to support vulnerable groups; in the UK and Latvia, PHI is used in a supplementary role to universal tax-based systems; in France and Latvia, complementary PHI is utilized to cover gaps in public funding; in The Netherlands, PHI is supplementary to statutory private and social health insurance; in Australia, the government incentivizes the uptake of complementary PHI through tax rebates and penalties. The uptake of PHI is influenced by age, income, education, health care system typology, and the incentives or disincentives applied by governments. The effect on equity can either be positive or negative depending on the type of PHI adopted and its role within the wider health care system.  PHI has many manifestations depending on the type of health care system used and its role within that system. This study has illustrated its common applications and the factors that affect its uptake and equity in different health care systems. The results are anticipated to be helpful in informing how developing countries may utilize PHI to meet the aim of achieving universal health care.

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title: Social Health Insurance Reexamined
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-pocket payments) 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 non-enrollment 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 non-poor 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.

title: Who pays for health care in Ghana?
abstract: BackgroundFinancial protection against the cost of unforeseen ill health has become a global concern as expressed in the 2005 World Health Assembly resolution (WHA58.33), which urges its member states to "plan the transition to universal coverage of their citizens". An important element of financial risk protection is to distribute health care financing fairly in relation to ability to pay. The distribution of health care financing burden across socio-economic groups has been estimated for European countries, the USA and Asia. Until recently there was no such analysis in Africa and this paper seeks to contribute to filling this gap. It presents the first comprehensive analysis of the distribution of health care financing in relation to ability to pay in Ghana.MethodsSecondary data from the Ghana Living Standard Survey (GLSS) 2005/2006 were used. This was triangulated with data from the Ministry of Finance and other relevant sources, and further complemented with primary household data collected in six districts. We implored standard methodologies (including Kakwani index and test for dominance) for assessing progressivity in health care financing in this paper.ResultsGhana's health care financing system is generally progressive. The progressivity of health financing is driven largely by the overall progressivity of taxes, which account for close to 50% of health care funding. The national health insurance (NHI) levy (part of VAT) is mildly progressive and formal sector NHI payroll deductions are also progressive. However, informal sector NHI contributions were found to be regressive. Out-of-pocket payments, which account for 45% of funding, are regressive form of health payment to households.ConclusionFor Ghana to attain adequate financial risk protection and ultimately achieve universal coverage, it needs to extend pre-payment cover to all in the informal sector, possibly through funding their contributions entirely from tax, and address other issues affecting the expansion of the National Health Insurance. Furthermore, the pre-payment funding pool for health care needs to grow so budgetary allocation to the health sector can be enhanced.

title: The financial protection effect of Ghana National Health Insurance Scheme: evidence from a study in two rural districts
abstract: BackgroundOne of the key functions of health insurance is to provide financial protection against high costs of health care, yet evidence of such protection from developing countries has been inconsistent. The current study uses the case of Ghana to contribute to the evidence pool about insurance's financial protection effects. It evaluates the impact of the country's National Health Insurance Scheme on households' out-of-pocket spending and catastrophic health expenditure.MethodsWe use data from a household survey conducted in two rural districts, Nkoranza and Offinso, in 2007, two years after the initiation of the Ghana National Health Insurance Scheme. To address the skewness of health expenditure data, the absolute amount of out-of-pocket spending is estimated using a two-part model. We also conduct a probit estimate of the likelihood of catastrophic health expenditures, defined at different thresholds relative to household income and non-food consumption expenditure. The analysis controls for chronic and self-assessed health conditions, which typically drive adverse selection in insurance.ResultsAt the time of the survey, insurance coverage was 35 percent. Although the benefit package of insurance is generous, insured people still incurred out-of-pocket payment for care from informal sources and for uncovered drugs and tests at health facilities. Nevertheless, they paid significantly less than the uninsured. Insurance has been shown to have a protective effect against the financial burden of health care, reducing significantly the likelihood of incurring catastrophic payment. The effect is particularly remarkable among the poorest quintile of the sample.ConclusionsFindings from this study confirm the positive financial protection effect of health insurance in Ghana. The effect is stronger among the poor group than among general population. The results are encouraging for many low income countries who are considering a similar policy to expand social health insurance. Ghana's experience also shows that instituting insurance by itself is not adequate to remove fully the out-of-pocket payment for health. Further works are needed to address the supply side's incentives and quality of care, so that the insured can enjoy the full benefits of insurance.

title: Equity in the finance of health care: some further international comparisons.
abstract: This paper presents further international comparisons of progressivity of health care financing systems. The paper builds on the work of Wagstaff et al. [Wagstaff, A., van Doorslaer E., et al., 1992. Equity in the finance of health care: some international comparisons, Journal of Health Economics 11, pp. 361-387] but extends it in a number of directions: we modify the methodology used there and achieve a higher degree of cross-country comparability in variable definitions; we update and extend the cross-section of countries; and we present evidence on trends in financing mixes and progressivity.

title: Private health insurance: implications for developing countries.
abstract: Private health insurance is playing an increasing role in both high- and low-income countries, yet is poorly understood by researchers and policy-makers. This paper shows that the distinction between private and public health insurance is often exaggerated since well regulated private insurance markets share many features with public insurance systems. It notes that private health insurance preceded many modern social insurance systems in western Europe, allowing these countries to develop the mechanisms, institutions and capacities that subsequently made it possible to provide universal access to health care. We also review international experiences with private insurance, demonstrating that its role is not restricted to any particular region or level of national income. The seven countries that finance more than 20% of their health care via private health insurance are Brazil, Chile, Namibia, South Africa, the United States, Uruguay and Zimbabwe. In each case, private health insurance provides primary financial protection for workers and their families while public health-care funds are targeted to programmes covering poor and vulnerable populations. We make recommendations for policy in developing countries, arguing that private health insurance cannot be ignored. Instead, it can be harnessed to serve the public interest if governments implement effective regulations and focus public funds on programmes for those who are poor and vulnerable. It can also be used as a transitional form of health insurance to develop experience with insurance institutions while the public sector increases its own capacity to manage and finance health-care coverage.

title: The role of risk equalization in moving from voluntary private health insurance to mandatory coverage: the experience in South Africa.
abstract: The South African health system has long been characterised by extreme inequalities in the allocation of financial and human resources. Voluntary private health insurance, delivered through medical schemes, accounts for some 60% of total expenditure but serves only the 14.8% of the population with higher incomes. A plan was articulated in 1994 to move to a National Health Insurance system with risk-adjusted payments to competing health funds, income cross-subsidies and mandatory membership for all those in employment, leading over time to universal coverage. This chapter describes the core institutional mechanism envisaged for a National Health Insurance system, the Risk Equalisation Fund (REF). A key issue that has emerged is the appropriate sequencing of the reforms and the impact on workers of possible trajectories is considered.



The design and functioning of the REF is described and the impact on competing health insurance funds is illustrated. Using a reference family earning at different income levels, the impact on worker of various trajectories of reform is demonstrated.



Risk equalization is a critical institutional component in moving towards a system of social or national health insurance in competitive markets, but the sequence of its implementation needs to be carefully considered. The adverse impact of risk equalization on low-income workers in the absence of income cross-subsidies and mandatory membership is considerable.



The South African experience of risk equalization is of interest as it attempts to introduce more solidarity into a small but highly competitive private insurance market. The methodology for considering the impact of reforms provides policymakers and politicians with a clearer understanding of the consequences of reform.

title: Affordable Care Act reforms could reduce the number of underinsured US adults by 70 percent.
abstract: To provide a baseline and assess the potential of changes brought about under the Affordable Care Act, this study estimates the number of US adults who were underinsured or uninsured in 2010. Using indicators of medical cost exposure relative to income, we find that 44 percent (81 million) of adults ages 19-64 were either uninsured or underinsured in 2010-up from 75 million in 2007 and 61 million in 2003. Adults with incomes below 250 percent of the federal poverty level account for sizable majorities of those at risk of becoming uninsured or underinsured. If reforms succeed in increasing the affordability of care for people in this income range, we could expect a 70 percent drop in the number of underinsured people and a steep drop in the number of uninsured people.

title: Health care policy in an age of austerity.
abstract: As they focus on the budget deficit, policymakers eye savings from federal health programs. Fiscal concerns may enhance the prospects for stronger cost controls, but they may also produce “reforms” that are mere exercises in cost shifting.

title: United Kingdom (England): Health system review.
abstract: The Health Systems in Transition (HiT) profiles are country-based reports that provide a detailed description of a health system and of policy initiatives in progress or under development. HiTs examine different approaches to the organization, financing and delivery of health services and the role of the main actors in health systems; describe the institutional framework, process, content and implementation of health and health care policies; and highlight challenges and areas that require more in-depth analysis. Various indicators show that the health of the population has improved over the last few decades. However, inequalities in health across socioeconomic groups have been increasing since the 1970s. The main diseases affecting the population are circulatory diseases, cancer, diseases of the respiratory system and diseases of the digestive system. Risk factors such as the steadily rising levels of alcohol consumption, the sharp increases in adult and child obesity and prevailing smoking levels are among the most pressing public health concerns, particularly as they reflect the growing health inequalities among different socioeconomic groups. Health services in England are largely free at the point of use. The NHS provides preventive medicine, primary care and hospital services to all those ordinarily resident. Over 12% of the population is covered by voluntary health insurance schemes, known in the United Kingdom as private medical insurance (PMI), which mainly provides access to acute elective care in the private sector. Responsibility for publicly funded health care rests with the Secretary of State for Health, supported by the Department of Health. The Department operates at a regional level through 10 strategic health authorities (SHAs), which are responsible for ensuring the quality and performance of local health services within their geographic area. Responsibility for commissioning health services at the local level lies with 151 primary care organizations, mainly primary care trusts (PCTs), each covering a geographically defined population. Health services are mainly financed from public sources, primarily general taxation and national insurance contributions (NICs). Some care is funded privately through PMI, some user charges, cost sharing and direct payments for health care delivered by NHS and private providers. While the reform programme that developed since 1997 proved to be massive in its scope, some basic features of the English NHS, such as its taxation-funding base, the predominantly public provision of services and division between purchasing (commissioning) and care delivery functions, remain unchanged. Nevertheless, in addition to the unprecedented level of financial resources allocated to the NHS since 2000, the most important reform measures included the introduction of the payment by results (PbR) hospital payment system; the expanded use of private sector provision; the introduction of more autonomous management of NHS hospitals through foundation trusts (FTs); the introduction of patient choice of hospital for elective care; new general practitioner (GP), consultant and dental services contracts; the establishment of the National Institute for Health and Clinical Excellence (NICE); and the establishment of the Care Quality Commission (CQC) to regulate providers and monitor quality of services. The English NHS faces future challenges as 2010 draws to a close, with significant restrictions on expenditure and a newly elected government that has announced its intention to introduce further widespread reform.

title: France: Health system review.
abstract: The Health Systems in Transition (HiT) profiles are country-based reports that provide a detailed description of a health system and of policy initiatives in progress or under development. HiTs examine different approaches to the organization, financing and delivery of health services and the role of the main actors in health systems; describe the institutional framework, process, content and implementation of health and health care policies; and highlight challenges and areas that require more in-depth analysis. The French health care system is a mix of public and private providers and insurers. Public insurance, financed by both employees and employer contributions and earmarked taxes, is compulsory and covers almost the whole population, while private insurance is of a complementary type and voluntary. Providers of outpatient care are largely private. Hospital beds are predominantly public or private non-profit-making. The French population enjoys good health and a high level of choice of providers. It is relatively satisfied with the health care system. However, as in many other countries, the rising cost of health care is of concern with regards to the objectives of the health care system. Many measures were or are being implemented in order to contain costs and increase efficiency. These include, for example, developing pay-for-performance for both hospitals and self-employed providers and increasing quality of professional practice; refining patient pathways; raising additional revenue for statutory health insurance (SHI); and increasing the role of voluntary health insurance (VHI). Meanwhile, socioeconomic disparities and geographic inequality in the density of health care professionals remain considerable challenges to providing a good level of equity in access to health care. Organizational changes at the regional level are important in attempting to tackle both equity and efficiency-related challenges. While the organizational structure of the system remained very stable until the mid 1990s, in the following decade many changes occurred and several new institutions were created. Concurrently, the respective power and involvement of the parliament, government, local authorities and SHI in the policy-making process have evolved. However, the Ministry of Health has retained substantial control over the health system, although ongoing reforms at both the regional and the national levels may challenge its traditional role. This edition of the French HiT was written concurrently with the vote and implementation of the 2009 Hospital, Patients, Health and Territories Act, which dramatically changed again the organizational structure and management of the health care system at the regional and local level. In order to ensure a comprehensive description and understanding of the system, the HiT, therefore, describes both the previous organization and the reorganization following the Act. However, the implementation process of the Act and its formal application was still a work in progress at the time of completing the French HiT.

title: Latvia: Health system review.
abstract: This analysis of the Latvian health system reviews recent developments in organization and governance, health financing, health care provision, health reforms and health-system performance. Latvia has been constantly reforming its health system for over two decades. After independence in 1991, Latvia initially moved to create a social health insurance type system. However, problems with decentralized planning and fragmented and inefficient financing led to this being gradually reversed, and ultimately the establishment in 2011 of a National Health Service type system. These constant changes have taken place against a backdrop of relatively poor health and limited funding, with a heavy burden for individuals; Latvia has one of the highest rates of out-of-pocket expenditure on health in the European Union (EU). The lack of financial resources resulting from the financial crisis has posed an enormous challenge to the government, which struggled to ensure the availability of necessary health care services for the population and to prevent deterioration of health status. Yet this also provided momentum for reforms: previous efforts to centralise the system and to shift from hospital to outpatient care were drastically accelerated, while at the same time a social safety net strategy was implemented (with financial support from the World Bank) to protect the poor from the negative consequences of user charges. However, as in any health system, a number of challenges remain. They include: reducing smoking and cardiovascular deaths; increasing coverage of prescription pharmaceuticals; reducing the excessive reliance on out-of-pocket payments for financing the health system; reducing inequities in access and health status; improving efficiency of hospitals through implementation of DRG-based financing; and monitoring and improving quality. In the face of these challenges at a time of financial crisis, one further challenge emerges: ensuring adequate funding for the health system through increased public expenditure on health.

title: Run for cover now or later? The impact of premiums, threats and deadlines on private health insurance in Australia
abstract: Between 1997 and 2000 the Australian government introduced three policy reforms that aimed to increase private health insurance coverage and reduce public hospital demand. The first provided income-based tax incentives; the second gave an across-the-board 30% premium subsidy; and the third introduced selective age-based premium increases for those enrolling after a deadline. Together the reforms increased enrolment by 50% and reduced the average age of enrollees. The deadline appeared to induce consumers to enroll now rather than delay. We estimate a model of individual insurance decisions and examine the effects of the reforms on the age and income distribution of those with private cover. We interpret the major driver of the increased enrollment as a response to a deadline and an advertising blitz, rather than a pure price response.

title: A Critique of the Private Health Insurance Regulations
abstract: The private health insurance sector is one of the most regulated sectors in Australia. The Private Health Insurance Incentives Scheme, along with community rating, is intended to make private insurance equitable, profitable and popular. We argue that the subsidy to health insurance ought to be a very effective tool for increasing insurance-but it was ineffective because community rating was ineffective. Using data from the Household Expenditure Survey we find that despite community rating rules which prohibit age-adjusted premiums, young adults paid considerably less for their insurance than older adults. We conclude that insurers circumvented community rating through plan design, screening older consumers into more expensive plans. We also find that the penalty of 2 per cent per year for delaying insurance, introduced as part of the lifetime cover plan, is too low to be effective. We reflect on the New Zealand experience, where a completely deregulated insurance industry continues to be profitable and enjoys similar rates of coverage to those of Australia, and we ask whether Australia too could not benefit from complete deregulation.

title: Common concerns amid diverse systems: health care experiences in five countries.
abstract: This article reports on a comparative survey of sicker adults in Australia, Canada, New Zealand, the United Kingdom, and the United States. The study finds that despite differences among the health care systems, large proportions of citizens across the five countries report dissatisfaction with their health care system and serious problems including medical and medication errors, faulty patient-physician communication, and poor care coordination. The most crucial policy implication of these findings is that a focus on a small population of intensive health system users could have the potential to both control costs and improve care.

title: The troubled transformation of Britain's National Health Service.
abstract: The author discusses the challenges and controversies surrounding the transformation of the U.K. National Health Service. In the new system, financial incentives and accountability are being introduced to improve efficiency and quality, waiting times for elective procedures are decreasing, and patients are able to choose their providers.

title: Waiting times for elective surgery and the decision to buy private health insurance.
abstract: More than 45% of Australians buy health insurance for private treatment in hospital. This is despite having access to universal and free public hospital treatment. Anecdotal evidence suggests that avoidance of long waits for public treatment is one possible explanation for the high rate of insurance coverage. In this study, we investigate the effect of waiting on individual decisions to buy private health insurance. Individuals are assumed to form an expectation of their own waiting time as a function of their demographics and health status. We model waiting times using administrative data on the population hospitalised for elective procedures in public hospitals and use the parameter estimates to impute the expected waiting time and the probability of a long wait for a representative sample of the population. We find that expected waiting time does not increase the probability of buying insurance but a high probability of experiencing a long wait does. On average, waiting time has no significant impact on insurance. In addition, we find that favourable selection into private insurance, measured by self-assessed health, is no longer significant once waiting time variables are included. This result suggests that a source of favourable selection may be aversion to waiting among healthier people.

title: The determinants of private medical insurance prevalence in England, 1997-2000.
abstract: The aim of this paper is to identify the factors that determine the prevalence of private medical insurance (PMI) in England.



Secondary data sources are the British Household Panel Survey (BHPS) 1997-2000, Laing's Healthcare Market Review 1999-2000, the United Kingdom (U.K.) Department of Health's National Health Service Waiting Times Team, and the Work Force Statistics Branch of the Department of Health.



Logistic regression models for panel data were used to compare non-PMI subscribers with individual subscribers and those with employer-provided PMI.



The BHPS data are collected by the Institute for Social and Economic Research at the University of Essex. Other data used were collected by Laing and Buisson and the U.K. Department of Health.



Individual PMI is more prevalent among the well-educated and healthy. Income, age, sex, and political preference are key determinants of PMI prevalence for both individual and employer paid PMI. Individuals are also likely to reflect on information with regard to waiting times in deciding whether or not to purchase PMI cover. The withdrawal of the tax subsidy in 1997 to PMI subscribers over 60 years of age did not impact on their rate of withdrawal from PMI coverage relative to the rate among all PMI subscribers, but may have discouraged potential new subscribers.



Current trends in the PMI market suggest that, over time, individually purchased PMI is likely to be partially displaced by PMI purchased as part of a company-based plan. However, having PMI is linked to economic factors in both groups, suggesting a similar segment of the population valuing the responsiveness that PMI provides. Geographic factors relating to waiting times and supply-side factors are associated with both individual and company-based PMI. The withdrawal of the tax subsidy to individual subscribers older than age of 60 resulted in a significant decline in the demand for PMI. In particular, the number of new subscribers in this group declined substantially.

title: Consumer-directed health care for persons under 65 years of age with private health insurance: United States, 2007.
abstract: Data from the National Health Interview Survey. In 2007, 17.3% of persons under 65 years of age with private health insurance were enrolled in a high deductible health plan (HDHP), 4.5% were enrolled in a consumer-directed health plan (CDHP), and 14.8% were in a family with a flexible spending account for medical expenses (FSA); Persons with directly purchased private health insurance were more likely to be enrolled in a high deductible plan than those who obtained their private health insurance through an employer or union; Higher incomes and higher educational attainment were associated with greater uptake and enrollment in HDHPs, CDHPs, and FSAs. National attention to consumer-directed health care has increased following the enactment of the Medicare Prescription Drug Improvement and Modernization Act of 2003 (P.L. 108-173), which established tax-advantaged health savings accounts (1). Consumer-directed health care enables individuals to have more control over when and how they access care, what types of care they use, and how much they spend on health care services. This report includes estimates of three measures of consumer-directed private health care. Estimates for 2007 are provided for enrollment in high deductible health plans (HDHPs), plans with high deductibles coupled with health savings accounts also known as consumer-directed health plans (CDHPs), and the percentage of individuals with private coverage whose family has a flexible spending account (FSA) for medical expenses, by selected sociodemographic characteristics.

title: The geographic distribution of private health insurance in Australia in 2001
abstract: BackgroundPrivate health insurance has been a major focus of Commonwealth Government health policy for the last decade. Over this period, the Howard government introduced a number of policy changes which impacted on the take up of private health insurance. The most expensive of these was the introduction of the private health insurance rebate in 1997, which had an estimated cost of $3 billion per annum.MethodsThis article uses information on the geographic distribution of the population with private health insurance cover to identify associations between rates of private health insurance cover and socioeconomic status. The geographic analysis is repeated with survey data on expenditure on private health insurance, to provide an estimate of the rebate flowing to different socioeconomic groups.ResultsThe analysis highlights the strong association between high rates of private health insurance cover and high socioeconomic status and shows the substantial transfer of funds, under the private health insurance rebate, to those living in areas of highest socioeconomic status, compared with those in areas of lower socioeconomic status, and in particular those in the most disadvantaged areas. The article also provides estimates of private health insurance cover by federal electorate, emphasising the substantial gaps in cover between Liberal Party and Australian Labor Party seats.ConclusionThe article concludes by discussing implications of the uneven distribution of private health insurance cover across Australia for policy formation. In particular, the study shows that the prevalence of private health insurance is unevenly distributed across Australia, with marked differences in prevalence in rural and urban areas, and substantial differences by socioeconomic status. Policy formation needs to take this into account. Evaluating the potential impact of changes in private health insurance requires more nuanced consideration than has been implied in the rhetoric about private health insurance over the last decade.

title: Private health insurance, mental health and service use in Australia
abstract: To report on the private health insurance (PHI) status of individuals with and without a mental health problem, and examine whether PHI status is associated with access to psychological services.  This is a descriptive study of nationally representative population-based data collected in 2009 (HILDA) with participants aged 15–93 (n = 13,301).  PHI status (categorised as ‘hospital cover only’, ‘extras cover only’, or ‘both hospital and extras cover’); mental health status (categorised as ‘have a mental health problem’ or ‘do not have a mental health problem’ using the Mental Health Index (MHI) of the Medical Outcomes Study Short Form); mental health service use (access to a mental health professional (psychologist/psychiatrist) in the past 12 months categorised as ‘yes’ or ‘no’).  Individuals with a mental health problem were less likely to have PHI than those without a mental health problem. However, PHI was not associated with access to a mental health professional in the past 12 months.  The findings suggest that while the discrepancy in PHI status is a marker of inequity between those with and without a mental health problem, it is not a key factor in facilitating access to mental health services.

title: Voluntary private health insurance among the over 50s in Europe.
abstract: Using data from Survey of Health, Ageing and Retirement in Europe (SHARE), we investigate the determinants of voluntary private health insurance (VPHI) among the over 50s in 11 European countries and their effects on healthcare spending. First, we find that the main determinants of VPHI are different in each country, reflecting differences in the underlying healthcare systems, but in most countries, education levels and cognitive abilities have a strong positive effect on holding a VPHI policy. We also analyse the effect of holding a voluntary additional health insurance policy on out-of-pocket (OOP) healthcare spending. We adopt a simultaneous equations approach to control for self-selection into VPHI policy holding and find that, only in the Netherlands, VPHI policyholders have lower OOP spending than the rest of the population, whereas in some countries (Italy, Spain, Denmark and Austria), they spend significantly more. This could be due to not only increased utilisation but also cost-sharing measures adopted by the insurers to counter the effects of moral hazard and to keep adverse selection under control.

title: The influence of federal health care policy reforms on the use of private health insurance in disadvantaged groups.
abstract: To examine changes in the incidence rate ratio of private health insurance (PHI) and Medicare use for episodes of hospitalisation as a function of socio-economic status and accessibility to evaluate the impact of federal health policy reforms.



The WA Data Linkage System was used to extract all hospital morbidity records in Western Australia from 1991, 1996 and 2001. Adjusted odds ratios of PHI use were estimated in each socio-economic and locational accessibility category in each year using logistic regression. The odds ratios were then converted to adjusted incidence rate ratios controlled for population size.



In all cases between 1991 and 1996 the adjusted incident rate ratios fell; this was followed by an increase in the adjusted rate ratio in 2001 to levels near those of 1991 in the most accessible--highest socio-economically advantaged group. However in all other groups the increase fell short of the 1991 levels. The magnitude of the shortfall was associated with worsening accessibility or socio-economic status. In addition, significant changes in the within-group differential incident rate ratios were also observed over time.



Our study indicates that the recent federal government policies which were aimed at making PHI more affordable to, and therefore more widely used by, lower to middle income earners were successful, lending empirical support for price elasticity of demand for PHI. Our results also indicate that the magnitude of their success varied according to disadvantage, suggesting that this elasticity is variable across both the level and typology of disadvantage.

title: Patients and procedures in short-stay independent hospitals in England and Wales, 1997-1998.
abstract: Private hospitals' activities are not routinely reported, so what services they provide and for whom is not known. This study describes the clientele and case-mix of independent hospitals in England and Wales in 1997-1998.



Person, clinical and funding data were collected on samples of patients admitted to 215 of 221 independent hospitals open in 1997-1998. Sample numbers were weighted to reflect sampling duration, region, season and non-response.



A total of 37,434 sampled records represented 828,422 admissions: 406,843 in-patients (5 per cent fewer than in 1992-1993) and 421,580 day cases (69 per cent more); 806,509 were residents of England and Wales (up 24 per cent); 16,628 came from overseas (down 20 per cent). Numbers increased in all age groups except children; 25 per cent were 65 or over (18 per cent in 1992-1993). The commonest procedures were abortion (11 per cent), endoscopy of the gastro-intestinal tract (10 per cent) or joints (5 per cent), lens operations (5 per cent), hernia repairs (3 per cent), and other common National Health Service (NHS) elective operations. The NHS funded 84,561 patients (11 per cent of the total) including 41,942 non-abortion cases (6 per cent). A total of 540,996 (76 per cent) paid through insurance; 119,101 (17 per cent) were self-funded including 30 per cent of the over-75s. Ninety-five per cent of patients went home, 0.3 per cent died and 0.2 per cent were transferred to NHS hospitals.



Demand for short-stay independent hospital care is rising. The clientele is becoming older, and readier to pay out of pocket. Clinical activity is mainly surgical and similar to NHS elective surgical demand. One year's caseload equals 10 weeks' elective admissions to NHS hospitals, in that sense relieving the NHS. The scale of transfer to NHS hospitals (three per day) is small.

title: Health, ageing and private health insurance: baseline results from the 45 and Up Study cohort
abstract: Correction to Banks E, Jorm L, Lujic S, Rogers K. Health, ageing and private health insurance: baseline results from the 45 and Up Study cohort. ANZ Health Policy 2009; 6: 16.

title: The 'graying' of group health insurance.
abstract: We examine differential declines in private insurance by income and age. We show that older, higher-income people in working families are more likely to retain private coverage as premiums rise, and we project these effects on future coverage rates. The analysis suggests that trends are leading to the "graying" of the employment-based health insurance system, where older, higher-income people get private health insurance, and others increasingly have public coverage or go without. These changes raise questions about the private health care system's ability to pool health risks. Population aging could interact with rising premiums and place additional pressure on an already strained employment-based health insurance system.

title: Can health care financing policy be emulated? The Singaporean medical savings accounts model and its Shanghai replica.
abstract: Each nation's government is searching for a cost-effective health care system. Some nations are developing their health care financing methods through gradual evolution of the existing ones, and others are trying to adopt other nations' successful schemes as their own financing strategies.



The Singaporean government seems able to finance its nation's health care with a very low gross domestic product (GDP) input. Since the implementation of the medical savings accounts schemes (MSAs) in 1984, Singaporean government's share of the nation's total health care expenditure dropped from about 50% to 20%. Inspired by Singapore's success, the Chinese government adopted the Singaporean MSAs model as its health care financing schemes for urban areas. Shanghai was the first large urban centre to implement the MSAs in China. Through the study of the Singapore and Shanghai experiences, this article examines whether it is rational to borrow another nation's health care financing model, especially when the two societies have very different socioeconomic characteristics.



However, the MSAs' success in Singapore did not guarantee its Shanghai success, because health care systems do not work alone. Through study of the MSAs' experiences in Singapore and Shanghai, this paper examines whether it is rational to borrow another nation's health care financing model, especially when the two societies have very different socioeconomic characteristics.

title: Rising educational gradients in mortality: the role of behavioral risk factors.
abstract: The long-standing inverse relationship between education and mortality strengthened substantially at the end of the 20th century. This paper examines the reasons for this increase. We show that behavioral risk factors are not of primary importance. Smoking declined more for the better educated, but not enough to explain the trend. Obesity rose at similar rates across education groups, and control of blood pressure and cholesterol increased fairly uniformly as well. Rather, our results show that the mortality returns to risk factors, and conditional on risk factors, the return to education, have grown over time.

title: Constraints to universal coverage: inequities in health service use and expenditures for different health conditions and providers
abstract: BackgroundThere is need for new information about the socio-economic and geographic differences in health seeking and expenditures on many health conditions, so to help to design interventions that will reduce inequity in utilisation of healthcare services and ensure universal coverage. paper contributes additional knowledge about health seeking and economic burden of different health conditions. It also shows the level of healthcare payments in public and private sector and their distribution across socioeconomic and geographic population groups. questionnaire was used to collect data from randomly selected householders from 4,873 households (2,483 urban and 2,390 rural) in southeast Nigeria. Data was collected on: health problems that people had and sought care for; type of care sought, outpatient department (OPD) visits and inpatient department (IPD) stays; providers visited; expenditures; and preferences for improving access to care. Data was disaggregated by socio-economic status (SES) and geographic location (urban versus rural) of the households.ResultsMalaria and hypertension were the major communicable and non-communicable diseases respectively that required OPD and IPD. Patent medicine dealers (PMDs) were the most commonly used providers (41.1%), followed by private hospitals (19.7%) and pharmacies (16.4%). The rural dwellers and poorer SES groups mostly used low-level and informal providers. The average monthly treatment expenditure in urban area was 2444 Naira (US$20.4) and 2267 Naira (US$18.9) in the rural area. Higher SES groups and urbanites incurred higher health expenditures. People that needed healthcare services did not seek care mostly because the health condition was not serious enough or they could not afford the cost of services.ConclusionThere were inequities in use of the different providers, and also in expenditures on treatment. Reforms should aim to decrease barriers to access to public and formal health services and also identify constraints which impede the equitable distribution and access of public health services for the general population especially for poor people and rural dwellers.