The Australian Private Health Insurance Boom: Was It Subsidies or Liberalised Regulation?

The income distributive implications of recent private health insurance policy reforms in Australia

“…8 Earlier studies employed various methods for estimating the effects of the PHI reforms. For example, Frech et al [8] used simple trend analysis to try to disentangle the effects of the different reforms, Palangkaraya and Yong [9,11] used logit-based counterfactual and regression discontinuity methods to pin down the estimated effects of a specific reform. By using a different empirical method, we contribute to the empirical literature in that our estimates can be compared with earlier findings in order to assess their robustness.…”

“…4 As depicted in Fig. 1 and analysed in other studies, these policy initiatives have been effective in encouraging the uptake of PHI (see Butler [7], Frech et al [8], and Palangkaraya and Yong [9], among others). The percentage of the population with PHI increased from approximately 31% in 1999 to around 45% at the end of 2001.…”

Community Rating, Entry-Age Rating and Adverse Selection in Private Health Insurance in Australia

“…However, allowing for the possibility that some of the credit belongs to the 30 per cent 11 Butler (2002). 12 Frech et al (2003). 13 Ibid.…”

The hidden cost of private health insurance in Australia

“…However research suggests that it is the Lifetime Community Rating policy (allowing risk discrimination in premiums) -which has negligible costs to the government -that is largely responsible for the expansion in PHI coverage, rather than the other two major policies. 9,10 In addition, when private patients are treated in public hospitals, the public hospital can only charge the fixed rate that is set by the federal government. This fixed rate is less than what private hospitals charge for the same services, and thus the government further subsidises the care of privately insured patients.…”