Education and Experience as Determinants of Micro Health Insurance Enrolment

Document Type : Original Article

Authors

1 Manipal Institute of Management, Centre for Advanced Research in Financial Inclusion, Manipal Academy of Higher Education, Manipal, Karnataka, India

2 University of Melbourne (Australia India Institute), Melbourne, VIC, Australia

3 Queensland University of Technology (BEST Centre), Brisbane, QLD, Australia

Abstract

Background
India faces a formidable challenge of providing universal health coverage to its uninsured population in the informal sector of the economy. Numerous micro health insurance (MHI) schemes have emerged as health financing mechanisms to reduce medical-illness-induced poverty. Existing research shows that the purchase of health insurance is most likely to be determined by health status, expected healthcare expenditure, and past health experiences in addition to socio-economic variables. We add to the understanding of various factors influencing enrolment in MHI from an Indian perspective.

 
Methods
A survey was carried out to collect quantitative data in three districts in the state of Karnataka, India.

 
Results
We show that education does not matter as significantly as experience does, in the determination of new insurance purchases. In other words, the importance of new insurance is not understood by those who are merely educated, but by those who have either fallen ill, or have previously seen the hazards of usurious borrowing.

 
Conclusion
Our study provides deeper insights into the role of usurious borrowing and past illness in determining insurance purchases and highlights the formidable challenge of financial sustainability in the MHI market of India.

Keywords

References

  1. Craig W. Don't Market to Your Customers; Educate Them Instead. Forbes. 2015. https://www.forbes.com/sites/williamcraig/2015/04/10/dont-market-to-your-customers-educate-them-instead/#3607426c1cfa.  Accessed February 15, 2019
  2. Nobles AL, Curtis BA, Ngo DA, Vardell E, Holstege CP. Health insurance literacy: a mixed methods study of college students. J Am Coll Health. 2019;67(5):469-478. doi:10.1080/07448481.2018.1486844
  3. Kasman M, Heuberger B, Hammond RA. Recommendations for Improving Youth Financial Literacy Education. Washington, DC: Economic Studies at Brookings; 2018.
  4. Tipirneni R, Politi MC, Kullgren JT, Kieffer EC, Goold SD, Scherer AM. Association between health insurance literacy and avoidance of health care services owing to cost. JAMA Netw Open. 2018;1(7):e184796. doi:10.1001/jamanetworkopen.2018.4796
  5. OECD Policy Brief. The Importance of Financial Education. OECD; 2006. http://www.oecd.org/finance/financial-education/37087833.pdf.   Accessed March 12, 2019.
  6. Ministry of Health and Family Welfare (MoHFW). National Health Accounts: Estimates for India 2014-15. October 2017. https://main.mohfw.gov.in/sites/default/files/NHA_Estimates_Report_2015-16_0.pdf.   Accessed September 22, 2019.
  7. Dercon S, Bold T, Calvo C. Insurance for the Poor? QEH Working Paper Series – QEHWPS125, Working Paper Number 125. Oxford: University of Oxford; 2004.
  8. Sauerborn R, Adams A, Hien M. Household strategies to cope with the economic costs of illness. Soc Sci Med. 1996;43(3):291-301. doi:10.1016/0277-9536(95)00375-4
  9. Leive A, Xu K. Coping with out-of-pocket health payments: empirical evidence from 15 African countries. Bull World Health Organ. 2008;86(11):849-856. doi:10.2471/blt.07.049403
  10. Peters DH, Yazbeck AS, Sharma RR, et al. Better Health Systems for India’s Poor: Findings, Analysis, and Options. Washington, DC: The World Bank; 2002.
  11. Scheil-Adlung X, Carrin G, Jutting J, Xu K. What is the impact of social health protection on access to health care, health expenditure and impoverishment? A comparative analysis of three African countries. Geneva: International Labour Organisation; 2006.
  12. Jütting JP. Do community-based health insurance schemes improve poor people's access to health care? evidence from rural Senegal. World Dev. 2004;32(2):273-288. doi:10.1016/j.worlddev.2003.10.001
  13. Acharya A, Ranson MK. Health care financing for the poor: community-based health insurance schemes in Gujarat. Econ Polit Wkly. 2005;40(38):4141-4150.
  14. Bennett S, Creese A, Monash R. Health Insurance Schemes for People Outside Formal Sector Employment. Geneva: WHO; 1998.
  15. Roth J, McCord MJ, Liber D. The Landscape of Microinsurance in the World's 100 Poorest Countries. Appleton, WI: The MicroInsurance Centre; 2007.
  16. De Bock O, Gelade W. The Demand for Micro-Insurance: A Literature Review. Geneva: International Labour Office; 2012.
  17. Carrin G, Waelkens MP, Criel B. Community-based health insurance in developing countries: a study of its contribution to the performance of health financing systems. Trop Med Int Health. 2005;10(8):799-811. doi:10.1111/j.1365-3156.2005.01455.x
  18. Ekman B. Community-based health insurance in low-income countries: a systematic review of the evidence. Health Policy Plan. 2004;19(5):249-270. doi:10.1093/heapol/czh031
  19. Liu Y. Development of the rural health insurance system in China. Health Policy Plan. 2004;19(3):159-165. doi:10.1093/heapol/czh019
  20. Cohen M, McCord MJ, Sebstad J. Reducing vulnerability: demand for and supply of microinsurance in East Africa. J Int Dev. 2005;17(3):319-325. doi:10.1002/jid.1192
  21. Bennett S. The role of community-based health insurance within the health care financing system: a framework for analysis. Health Policy Plan. 2004;19(3):147-158. doi:10.1093/heapol/czh018
  22. Jehu-Appiah C, Aryeetey G, Spaan E, de Hoop T, Agyepong I, Baltussen R. Equity aspects of the National Health Insurance Scheme in Ghana: who is enrolling, who is not and why? Soc Sci Med. 2011;72(2):157-165. doi:10.1016/j.socscimed.2010.10.025
  23. Barrett GF, Conlon R. Adverse selection and the decline in private health insurance coverage in Australia: 1989-95. Econ Rec. 2003;79(246):279-296. doi:10.1111/1475-4932.00104
  24. Dror DM, Hossain SA, Majumdar A, Pérez Koehlmoos TL, John D, Panda PK. What factors affect voluntary uptake of community-based health insurance schemes in low-and middle-income countries? a systematic review and meta-analysis. PLoS One. 2016;11(8):e0160479. doi:10.1371/journal.pone.0160479
  25. Ito S, Kono H. Why is the take‐up of microinsurance so low? evidence from a health insurance scheme in India. Dev Econ. 2010;48(1):74-101. doi:10.1111/j.1746-1049.2010.00099.x
  26. Mahmood SS, Hanifi SMA, Mia MN, et al. Who enrols in voluntary micro health insurance schemes in low-resource settings? experience from a rural area in Bangladesh. Glob Health Action. 2018;11(1):1525039. doi:10.1080/16549716.2018.1525039
  27. Bendig M, Arun T. Enrolment in Micro Life and Health Insurance: Evidences from Sri Lanka. Bonn: IZA; 2011.
  28. Mathiyazhagan K. Willingness to pay for rural health insurance through community participation in India. Int J Health Plann Manage. 1998;13(1):47-67. doi:10.1002/(sici)1099-1751(199801/03)13:13.0.co;2-i
  29. Dong H, De Allegri M, Gnawali D, Souares A, Sauerborn R. Drop-out analysis of community-based health insurance membership at Nouna, Burkina Faso. Health Policy. 2009;92(2-3):174-179. doi:10.1016/j.healthpol.2009.03.013
  30. Wang H, Yip W, Zhang L, Wang L, Hsiao W. Community-based health insurance in poor rural China: the distribution of net benefits. Health Policy Plan. 2005;20(6):366-374. doi:10.1093/heapol/czi045
  31. Kronick R, Gilmer T. Explaining the decline in health insurance coverage, 1979-1995. Health Aff (Millwood). 1999;18(2):30-47. doi:10.1377/hlthaff.18.2.30
  32. Fang H, Keane MP, Silverman D. Sources of advantageous selection: evidence from the Medigap insurance market. J Polit Econ. 2008;116(2):303-350.
  33. Buchmueller TC, Fiebig D, Jones G, Savage E. Advantageous Selection in Private Health Insurance: The Case of Australia. Centre for Health Economics Research and Evaluation (CHERE); 2008.
  34. Chernew M, Cutler DM, Keenan PS. Increasing health insurance costs and the decline in insurance coverage. Health Serv Res. 2005;40(4):1021-1039. doi:10.1111/j.1475-6773.2005.00409.x
  35. Bhat R, Jain N. A Study of Factors Affecting the Renewal of Health Insurance Policy. Ahmedabad: IIMA; 2006.
  36. Binnendijk E, Dror DM, Gerelle E, Koren R. Estimating willingness-to-pay for health insurance among rural poor in India by reference to Engel's law. Soc Sci Med. 2013;76(1):67-73. doi:10.1016/j.socscimed.2012.10.006
  37. Dror DM, Firth LA. The demand for (micro) health insurance in the informal sector. Geneva Pap Risk Insur Issues Pract. 2014;39(4):693-711. doi:10.1057/gpp.2014.24
  38. Ataguba JE. Community Health Insurance Scheme as a viable option for rural population in Nigeria. Oxford: University of Oxford; 2008.
  39. Vellakkal S. Determinants of enrolment in voluntary health insurance: evidences from a mixed method study, Kerala, India. Int J Financ Res. 2013;4(2):99-107. doi:10.5430/ijfr.v4n2p99
  40. Polonsky J, Balabanova D, McPake B, et al. Equity in community health insurance schemes: evidence and lessons from Armenia. Health Policy Plan. 2009;24(3):209-216. doi:10.1093/heapol/czp001
  41. Panda P, Chakraborty A, Dror DM, Bedi AS. Enrolment in community-based health insurance schemes in rural Bihar and Uttar Pradesh, India. Health Policy Plan. 2014;29(8):960-974. doi:10.1093/heapol/czt077
  42. Chankova S, Sulzbach S, Diop F. Impact of mutual health organizations: evidence from West Africa. Health Policy Plan. 2008;23(4):264-276. doi:10.1093/heapol/czn011
  43. Dewar DM. Do those with more formal education have better health insurance opportunities? Econ Educ Rev. 1998;17(3):267-277. doi:10.1016/S0272-7757(97)00034-4
  44. Sapelli C, Vial B. Self-selection and moral hazard in Chilean health insurance. J Health Econ. 2003;22(3):459-476. doi:10.1016/s0167-6296(02)00121-2
  45. Nyman JA. The Theory of Demand for Health Insurance. Stanford, CA: Stanford University Press; 2003.
  46. Dror DM, Jacquier C. Micro‐insurance: extending health insurance to the excluded. Int Soc Secur Rev. 1999;52(1):71-97. doi:10.1111/1468-246x.00034
  47. Coate S, Ravallion M. Reciprocity without commitment: characterization and performance of informal insurance arrangements. J Dev Econ. 1993;40(1):1-24. doi:10.1016/0304-3878(93)90102-S
  48. Platteau JP, Ontiveros DU. Understanding and Information Failures: Lessons from a Health Microinsurance Program in India. ILO Research Paper (29). Geneva: ILO; 2013.
  49. Knack S. Democracy, Governance, and Growth. Michigan: University of Michigan Press; 2003.
  50. Dror D. Why “one-size-fits-all” health insurance products are unsuitable for low-income persons in the informal economy in India. Asian Econ Rev. 2007;49(1):1-11.
  51. Dror DM, Majumdar A, Panda P, John D, Koren R. Implementing a participatory model of micro health insurance among rural poor with evidence from Nepal. Geneva Pap Risk Insur Issues Pract. 2014;39(2):280-303. doi:10.1057/gpp.2013.31
  52. Bonan J, Dagnelie O, LeMay-Boucher P, Tenikue M. Is it All About Money? A Randomized Evaluation of the Impact of Insurance Literacy and Marketing Treatments on the Demand for Health Microinsurance in Senegal. Geneva: International Labour Office and Microinsurance Innovation Facility; 2012.
  53. Outreville JF. The relationship between insurance and economic development: 85 empirical papers for a review of the literature. Risk Manag Insur Rev. 2013;16(1):71-122. doi:10.1111/j.1540-6296.2012.01219.x
  54. Graddy K. Markets: the Fulton fish market. J Econ Perspect. 2006;20(2):207-220.
  55. Banerjee S. Power Analysis and Sample Sizes: A Binding Frontier Approach. New Delhi: Indian Statistical Institute; 2015.
  56. Giné X, Townsend R, Vickery J. Patterns of rainfall insurance participation in rural India. World Bank Econ Rev. 2008;22(3):539-566.
  57. Wang H, Zhang L, Yip W, Hsiao W. Adverse selection in a voluntary Rural Mutual Health Care health insurance scheme in China. Soc Sci Med. 2006;63(5):1236-1245. doi:10.1016/j.socscimed.2006.03.008
International Journal of Health Policy and Management
Volume 10, Issue 4
April 2021
Pages 192-200

Files

History

  • Receive Date: 07 April 2019
  • Revise Date: 11 February 2020
  • Accept Date: 15 March 2020
  • First Publish Date: 01 April 2021

Share

How to cite

Statistics