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Willigness to Pay for Long-Term Care Coverage: the Role of Private Information and Self-Insurance

Author

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  • Joan Costa Font
  • Juan Rovira Forns

    (Universitat de Barcelona)

Abstract

Both public and private insurance for long-term care is undeveloped in some European countries such as in Spain and empirical evidence is still limited. This paper aims at examining the determinants of the demand for Long Term Care (LTC) coverage in Spain using contingent valuation techniques. Our findings indicate that only one-fifth of the population is willing to pay to assure coverage for LTC expenditures although we find high price elasticity. LTC coverage decisions are significantly affected by private information asymmetry and housing tenure in giving rise to self-insurance reduces the probability of insurance being hypothetically purchased.

Suggested Citation

  • Joan Costa Font & Juan Rovira Forns, 2004. "Willigness to Pay for Long-Term Care Coverage: the Role of Private Information and Self-Insurance," Working Papers in Economics 124, Universitat de Barcelona. Espai de Recerca en Economia.
    • Handle: RePEc:bar:bedcje:2004124
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    Cited by:

    1. Joan Costa-Fonta & Montserrat Font-Vilalta, "undated". "The limits on the Design of Long-Term Care Insurance Schemes in Spain stas," Studies on the Spanish Economy 201, FEDEA.
    2. Rinaldo Brau & Matteo Lippi Bruni, 2008. "Eliciting the demand for long‐term care coverage: a discrete choice modelling analysis," Health Economics, John Wiley & Sons, Ltd., vol. 17(3), pages 411-433, March.

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    More about this item

    JEL classification:

    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
    • H43 - Public Economics - - Publicly Provided Goods - - - Project Evaluation; Social Discount Rate
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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