Choosing Health Insurance in a Dual Health Care System: The Chilean Case
Journal of Applied Economics, Vol. 5, No. 1, pp. 157-184, May 2002
Posted: 13 Jul 2004
In Chile there is a public insurance system where people contribute a fixed percentage of their income, and also a private system where people pay a premium based on their personal characteristics. Using a large survey for 1996, we study the determinants of the decision to buy a private health plan. We find that the probability of buying a private health plan is positively correlated with income and living in areas with private health services providers. This probability decreases as families become older, and with a larger proportion of fertile age females. We also find that people who are more likely to demand health services prefer to buy a private health plan, and that people enrolled in a private health plan increase their use of health services. The segmentation observed in the health sector relates with the way private insurers and the public insurance system set their premiums.
Keywords: Health insurance, health services, income segmentation
JEL Classification: D81, I11
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