Sandra Hopkins

The determinants of the demand for private health insurance under Medicare

Since the introduction of Medicare in 1984, the proportion of the Australian population with private health insurance has declined considerably. Insurance for health care consumption is compulsory for the public health sector but optional for the private health sector. In this paper, we explore a number of important issues in the demand for private health insurance in Australia. The socio-economic variables which influence demand are examined using a binary logit model. A number of simulations are performed to highlight the influence and relative importance of various characteristics such as age, income, health status and geographical location on demand. A number of important policy issues in the private health insurance market are highlighted. First, evidence is provided of adverse selection in the private health insurance pool, second, the notion of the wealthy uninsured is refuted, and finally it is confirmed that there are significant interstate differences in the demand for private health insurance.

The impact of changes in private health expenditure on New Zealand households

The proportion of New Zealands total health expenditure financed by the public sector has fallen from 87% in 1983/84 to 77% in 1997/98 in real per capita terms. In the paper, we firstly describe changes in private health expenditure in New Zealand and compare these changes with trends in private and public health expenditure in a number of OECD countries. Secondly, we find that in New Zealand, there have been increases in both out-of-pocket payments and membership of private health insurance funds over the period from 1983/84 to 1997/98. We analyze the relationship between out-of-pocket expenditure, insurance expenditure, and household income across income deciles and across time. We find that out-of-pocket payments are regressive but the regressivity did decline in 1993/94 in response to a government initiative to improve the targeting of government subsidies towards lower income households.

Private health insurance status and utilisation of dental services in Australia

This article focuses on the relationship between private insurance status and dental service utilisation in Australia using data between 1995 and 2001. This article employs joint maximum likelihood to estimate models of time since last dental visit treating private ancillary health insurance (PAHI) as endogenous. The sensitivity of results to the choice between two different but related types of instrumental variables is examined. We find robust evidence in both 1995 and 2001 that individuals with a PAHI policy make significantly more frequent dental consultations relative to those without such coverage. A comparison of the 1995 and 2001 results, however, suggests that there has been an increasing role of PAHI in terms of the frequency of dental consultations over time. This seems intuitive given the trends in the price of unsubsidised private dental consultations. In terms of policy, our results suggest that while government measures to increase private health insurance coverage in Australia have been successful to a significant degree, that success may have come at some cost in terms of socio-economic inequality as the privately insured are provided much better access to care and financial protection.

The Australian health policy changes of 1999 and 2000: an evaluation.

This article evaluates three measures introduced by the Australian Federal Government in 1999 and 2000 that were designed to encourage private health insurance and relieve financial pressure on the public healthcare sector. These policy changes were (i) a 30% premium rebate, (ii) health insurers offering lifetime enrolment on existing terms and the future relaxation of premium regulation by permitting premiums to increase with age, and (iii) a mandate for insurers to offer complementary coverage for bridging the gap between actual hospital billings and benefits paid.These measures were first evaluated in terms of expected benefits and costs at the individual level. In terms of the first criteria, the policy changes as a whole may have been efficiency-increasing. The Australian Government mandate to launch gap policies may well have created a spillover moral hazard effect to the extent that full insurance coverage encouraged policy holders to also use more public hospital services, thus undermining the government’s stated objective to relieve public hospitals from demand pressure. Without this spillover moral hazard effect, there might have been a reduction in waiting times in the public sector. Secondly, the measures were evaluated in terms of additional benchmarks of the cost to the public purse, access and equity, and dynamic efficiency. Although public policy changes were found to be largely justifiable on the first set of criteria, they do not appear to be justifiable based on the second set. Uncertainties and doubts remain about the effect of the policy changes in terms of overall cost, access and equity, and dynamic efficiency. This is a common experience in countries that have considered shifts of their healthcare systems between the private and public sectors.

Health Expenditure Comparisons: Low, Middle and High Income Countries~!2010-02-04~!2010-06-11~!2010-08-31~!

Cross-sectional health expenditure data are used to compare health expenditure aggregates and the contribution of the public and private sectors in a selection of 31 low, middle and high income countries. The comparative data illustrate the diversity of outcomes in terms of total health expenditure and its components even amongst countries with similar GDP per capita. Low and middle income countries on the whole, rely more heavily on private funding especially household out-of-pocket payments. Public funding is more prevalent for funding of curative care than for funding of pharmaceuticals in high, middle and low income countries. The results illustrate the usefulness of internationally comparable health expenditure data to undertake cross country comparisons. Such comparisons are crucial for contributing to evidence based policy.

Income and Health Concentration in Australia

This paper measures the concentration of ill-health among income groups in Australia using health survey data from 1989-90 (Australian Bureau of Statistics 1991) and 1995 (Australian Bureau of Statistics 1997), which contain responses on self-assessed health status and gross personal income. The technique of direct standardisation is used to control for the influence on health status of gender and age. Comparisons of the concentration of ill-health over time and between males and females and persons living in rural and urban areas are reported. For both surveys and all groups, we find that ill-health is concentrated among lower income groups. Concentration measures of ill-health are higher (in absolute terms) for men than for women. In all categories apart from women, the concentration measures fell between 1989-90 and 1995 surveys.

Do Interventions Contain Infor Mation? Evidence from the Australian Foreign Exchange Market

In 1993, the political uncertainty regarding the passage of the Federal Budget through the Senate was reflected in the foreign exchange market. During August and September 1993, the Australian dollar depreciated by 7.5%. We present the results of a case study of the impact of official intervention and the infor Mation available to the market participants on the Australian dollar value over this period. We use daily data on the volume of intervention, the movement of the dollar and Reserve Bank of Australia announcements on intervention to consider the relative importance of infor Mation in the market. Our results indicate that the infor Mational content of interventions is a major factor in the success of intervention policy.

Hepatitis B status in migrants and refugees: increasing health burden in Western Australia.

Background:  In light of increasing migration from endemic countries with chronic hepatitis B (CHB), this study describes the changing epidemiology of CHB patients born outside Australia referred to a tertiary hospital in Western Australia. It aims to stratify risk and progression to cirrhosis and hepatocellular carcinoma according to viral factors and to provide an indication of the growing burden of disease and current and future treatment costs.