Modelling The Demand For Health Care Given Insurance: Notes For Researchers

Abstract

Understanding on health care demand given insurance givesprecious information to anticipate health care costs in the future,which in turn provides valuable information for policy makers,among other, to estimate claim rate, set up premium, designcost-sharing policy, etc. Unfortunately, estimating the effectsof health insurance on health care demand is not straightforward. This paper identifies crucial factors (e.g., adverseselection and provider behaviour) that need to be consideredin estimating the effects of health insurance on health caredemand. These considerations persuade researchers to usea rigorous econometric model in estimating health care demandgiven insurance with a view to isolate the true effects ofhealth insurance program. Such considerations can be furtherclassified into two-main factors. First is the features of thedependent variables used to measure the demand, and secondis the source of the data (or study design) used in the analysis.Keywords: modelling, health insurance, demand healthcareservices, applied econometric