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Demand for private health insurance in Chinese urban areas

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  • Xiao‐Hua Ying
  • Teh‐Wei Hu
  • Jane Ren
  • Wen Chen
  • Ke Xu
  • Jin‐Hui Huang

Abstract

Between 1993 and 2003, the proportion of urban residents without health insurance rose from 27 to 50%. The probability of outpatient visits in the previous 2 weeks dropped from 19.9 to 11.8% in urban areas between 1993 and 2003, and from 16.0 to 13.9% in rural areas. To improve risk‐pooling and risk‐sharing, private health insurance should play an important role in China's health insurance system. This paper estimates the demand for private health insurance in urban areas using contingent valuation methods. Individuals were asked about their willingness‐to‐pay (WTP) for major catastrophic disease insurance (MCDI), inpatient expenses insurance (IEI), and outpatient expenses insurance (OEI). The study was based on a household survey conducted in four small cities in China in 2004 and included 2671 respondents. More people would like to buy IEI and MCDI (48.5 and 43.0%, respectively) than OEI (24.5%). In addition, individuals would pay a higher premium for MCDI and IEI than for OEI. The price elasticities of demand for MCDI, IEI, and OEI were −0.27, −0.34, and −0.42, respectively. The determinants of enrollment in the three private health insurance programs were similar with employment status, age, education, and income. Copyright © 2007 John Wiley & Sons, Ltd.

Suggested Citation

  • Xiao‐Hua Ying & Teh‐Wei Hu & Jane Ren & Wen Chen & Ke Xu & Jin‐Hui Huang, 2007. "Demand for private health insurance in Chinese urban areas," Health Economics, John Wiley & Sons, Ltd., vol. 16(10), pages 1041-1050, October.
    • Handle: RePEc:wly:hlthec:v:16:y:2007:i:10:p:1041-1050
    DOI: 10.1002/hec.1206
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    Cited by:

    1. David Mark Dror, 2018. "Estimating Willingness-to-Pay for Health Insurance Among Rural Poor in India by Reference to Engel’s Law," World Scientific Book Chapters, in: Financing Micro Health Insurance Theory, Methods and Evidence, chapter 7, pages 139-149, World Scientific Publishing Co. Pte. Ltd..
    2. Yawen Jiang & Weiyi Ni, 2019. "Risk selection into supplemental private health insurance in China," Health Economics Review, Springer, vol. 9(1), pages 1-11, December.
    3. Macha, Raphael Rasiel, 2015. "Community Based Health Insurance Schemes and Protection of the Rural Poor: Empirical evidence from Tanzania," African Journal of Economic Review, African Journal of Economic Review, vol. 3(2), July.
    4. Jens-Oliver Bock & Dirk Heider & Herbert Matschinger & Hermann Brenner & Kai-Uwe Saum & Walter Haefeli & Hans-Helmut König, 2016. "Willingness to pay for health insurance among the elderly population in Germany," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 17(2), pages 149-158, March.
    5. Liu, Hong & Gao, Song & Rizzo, John A., 2011. "The expansion of public health insurance and the demand for private health insurance in rural China," China Economic Review, Elsevier, vol. 22(1), pages 28-41, March.
    6. Trinh, Cong Tam & Chao, Chi-Chur & Ho, Nhut Quang, 2023. "Private health insurance consumption and public health-care provision in OECD countries: Impact of culture, finance, and the pandemic," The North American Journal of Economics and Finance, Elsevier, vol. 64(C).
    7. Qun Wang & Yi Zhou & Xinrui Ding & Xiaohua Ying, 2017. "Demand for Long-Term Care Insurance in China," IJERPH, MDPI, vol. 15(1), pages 1-15, December.
    8. Ying Zhang & Rui Wang & Xinyi Yao, 2019. "Assessing determinants of health care prepayment in China: Economic growth or government willingness? New evidence from the continuous wavelet analysis," International Journal of Health Planning and Management, Wiley Blackwell, vol. 34(1), pages 694-712, January.
    9. Yinzi Jin & Zhiyuan Hou & Donglan Zhang, 2016. "Determinants of Health Insurance Coverage among People Aged 45 and over in China: Who Buys Public, Private and Multiple Insurance," PLOS ONE, Public Library of Science, vol. 11(8), pages 1-15, August.
    10. Nguyen, Ha & Knowles, James, 2010. "Demand for voluntary health insurance in developing countries: The case of Vietnam's school-age children and adolescent student health insurance program," Social Science & Medicine, Elsevier, vol. 71(12), pages 2074-2082, December.

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