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Public policy and private health insurance: distributional impact on public and private hospital usage
Agnes E Walker1, Richard Percival, Linc Thurecht
1Australian Centre for Economic Research on Health, Australian National University, Barry Drive (Building 62), Canberra, ACT 0200, Australia. Agnes.Walker@anu.edu.au
Objective:
To study the effectiveness of recent private health insurance (PHI) reforms, in particular the 30% rebate and Lifetime Health Cover, in terms of their stated aim of reducing the load on public hospitals.
Methods:
Combines the use of two new projection models - "Private Health Insurance" (PHI) and "New South Wales Hospitals" that use public and private hospital inpatient data from 1996-97 to 1999-2000, and NSW population and private health insurance coverage statistics.
Results:
With the PHI reforms 15% fewer individuals would use public hospitals in 2010 than without these reforms (around 18% fewer among the 40% most affluent Australians and 9% among the 40% least affluent). Lower public hospital usage would mainly be due to Lifetime Health Cover.
Conclusion:
If the PHI reforms remain in place, in 2010 a significant proportion of hospital use would be redirected away from the public sector and towards the private sector, with the shift being greatest among better-off Australians.
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