Healthcare Consumers’ Sensitivity to Costs: A Reflection on Behavioural Economics from an Emerging Market

10 Pages Posted: 1 Aug 2018

See all articles by Quan Hoang Vuong

Quan Hoang Vuong

Université Libre de Bruxelles (ULB) - Solvay Brussels School of Economics and Management; Phenikaa University

Tung-Manh Ho

Thanh Tay University

Hong-Kong Nguyen

Thanh Tay University

Thu-Trang Vuong

Vuong & Associates; Sciences Po, Students

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Date Written: June 2018

Abstract

Decision-making regarding healthcare expenditure hinges heavily on an individual's health status and the certainty about the future. This study uses data on propensity of general health exam (GHE) spending to show that despite the debate on the necessity of GHE, its objective is clear—to obtain more information and certainty about one’s health so as to minimise future risks. Most studies on this topic, however, focus only on factors associated with GHE uptake and overlook the shifts in behaviours and attitudes regarding different levels of cost. To fill the gap, this study analyses a dataset of 2068 subjects collected from Hanoi (Vietnam) and its vicinities using the baseline-category logit method. We evaluate the sensitivity of Vietnamese healthcare consumers against two groups of factors (demographic and socioeconomic-cognitive) regarding payment for periodic GHE, which is not covered by insurance. Our study shows that uninsured, married and employed individuals are less sensitive to cost than their counterparts because they value the information in reducing future health uncertainty. The empirical results challenge the objections to periodic health screening by highlighting its utility. The relevance of behavioural economics is further highlighted through a look at the bounded rationality of healthcare consumers and private insurance companies in using and providing the service, respectively.

Suggested Citation

Vuong, Quan Hoang and Ho, Tung-Manh and Nguyen, Hong-Kong and Vuong, Thu-Trang, Healthcare Consumers’ Sensitivity to Costs: A Reflection on Behavioural Economics from an Emerging Market (June 2018). Palgrave Communications, Vol. 4, Issue 1, pp. 70-70, 2018, Available at SSRN: https://ssrn.com/abstract=3219088 or http://dx.doi.org/10.1057/s41599-018-0127-3

Quan Hoang Vuong (Contact Author)

Université Libre de Bruxelles (ULB) - Solvay Brussels School of Economics and Management ( email )

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Phenikaa University ( email )

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Vietnam

HOME PAGE: http://sites.google.com/site/vuongqh2019/

Tung-Manh Ho

Thanh Tay University

Hanoi
Vietnam

Hong-Kong Nguyen

Thanh Tay University

Hanoi
Vietnam

Thu-Trang Vuong

Vuong & Associates ( email )

3/161 Thinh Quang
Dong Da District
Hanoi, 100000
Vietnam

Sciences Po, Students ( email )

28 Rue des Saint-Peres
Paris, Paris 75006
France

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