nep-ias New Economics Papers
on Insurance Economics
Issue of 2018‒03‒05
four papers chosen by
Soumitra K. Mallick
Indian Institute of Social Welfare and Business Management

  1. People’s Republic of China; Financial Sector Assessment Program- Detailed Assessment of Observance of the Insurance Core Principles By International Monetary Fund
  2. The Effect of Community Engagement on Healthcare Utilization and Health Insurance Enrolment in Ghana Results from a Randomized Experiment By Stephen K.O. Duku; Edward Nketiah-Amponsahd; Christine J. Fenenga; Daniel K. Arhinful; Wendy (W.) Janssens; Menno (M.) Pradhan
  3. How Do Prescription Drugs Affect the Use of Other Health Services? By Gal Wettstein
  4. Intergenerational Spillovers in Disability Insurance By Gordon B. Dahl; Anne (A.C.) Gielen

  1. By: International Monetary Fund
    Abstract: The Chinese insurance sector is experiencing rapid growth, posing particular challenges to effective supervision. The sector has been growing by over 20 percent a year and there are ambitious government targets for further development. Many individual, often newer, companies are growing at rates far in excess of the average. New entrants, products and distribution channels, combined with the liberalization of pricing, have increased competition. At the same time, slower economic growth and reduced investment returns are exposing many established life insurers to the risk of loss due to the rising value of their liabilities. Many non-life companies are moving into new lines of business as margins in established lines erode. While their customers continue to benefit from a dynamic market, there are risks to insurance companies’ business models, performance and to solvency as well as risks of misconduct in the treatment of insurance customers. There are particular challenges for insurance supervisors to remain abreast of developing risks, while continuing to strengthen the regulatory and supervisory system for the longer term.
    Keywords: Asia and Pacific;
    Date: 2017–12–26
  2. By: Stephen K.O. Duku (University of Ghana, Ghana); Edward Nketiah-Amponsahd (University of Ghana, Legon, Ghana); Christine J. Fenenga (Amsterdam Institute for Global Health and Development, the Netherlands); Daniel K. Arhinful (University of Ghana, Ghana); Wendy (W.) Janssens (Vrije Universiteit Amsterdam); Menno (M.) Pradhan (Amsterdam)
    Abstract: Background: Health insurance enrolment in many Sub-Saharan African countries is low, even with highly subsidized premiums and exemptions for vulnerable populations. This paper evaluates the impact of a community engagement intervention implemented in Ghana with the aim of improving clients’ perceptions on service quality and subsequently improving healthcare utilization and health insurance enrolment. Method: We used a panel data of 6,937 individuals from a cluster randomized controlled trial conducted in 64 communities in two regions in Ghana. A random half of communities received the intervention after a baseline survey in April 2012; the remaining communities served as controls. A follow-up survey was conducted in March 2014 to evaluate the intervention. Ordinary Least Squares regression estimations were used to measure the intervention’s impact on quality perceptions, and on healthcare utilization and health insurance enrolment for the full and balanced samples of all household members as well as the uninsured at baseline. Results: In the short term (12 months) the intervention did not produce any significant impact on perceptions of service quality, healthcare utilization or health insurance enrolment in the targeted population. It however reduced the frequency of illness by 13.8 percentage points, suggesting an overall improvement in health status. It also resulted in a 7.2 percentage points increase in insurance enrolment for the uninsured. Conclusion: Community engagement has the potential to motivate service providers to improve quality of care. However, this may not lead to improved perception of service quality, and increased healthcare utilization in the short term. Still, engaging clients in community discussions on quality improvements can effectively enhance health insurance uptake among those who were previously uninsured. Further long-term intervention is necessary to investigate its long-term effects.
    Keywords: health insurance; Ghana; randomized experiment; community participation
    Date: 2018–02–28
  3. By: Gal Wettstein
    Abstract: Over the past decade, the availability of prescription drugs has increased, particularly for the elderly. Medicare Part D expanded coverage to include prescription drugs, and the Affordable Care Act (ACA) enhanced Part D’s coverage. While lowering the cost of prescription drugs would obviously encourage more use of medications, the implications of such changes for the rest of the health care market are less clear. The answer depends on whether drugs are “substitutes” for other care or “complements.” Drugs could be substitutes if they prevent deterioration in health conditions that would otherwise require more intensive care, such as surgery. However, in many ways, drugs may be complements to other care, adding value to other tools in the clinician’s toolbox. To explore this issue, this brief examines the use of health services before and after the introduction of Part D. The discussion proceeds as follows. The first section provides background on Part D and summarizes previous reesearch on how it affects the use of other health services. The second section explains the data and methodology used in this study. The third section shows the main results. The final section concludes that broadening the availability of drugs increases the use of office-based health care, with a possible decline in the use of inpatient facilities.
    Date: 2018–02
  4. By: Gordon B. Dahl (UCSD); Anne (A.C.) Gielen (IZA)
    Abstract: Does participation in a social assistance program by parents have spillovers on their children's own participation, future labor market attachment, and human capital investments? While intergenerational concerns have figured prominently in policy debates for decades, causal evidence is scarce due to nonrandom participation and data limitations. In this paper we exploit a 1993 policy reform in the Netherlands which tightened disability insurance (DI) criteria for existing claimants, and use rich panel data to link parents to children's long-run outcomes. The key to our regression discontinuity design is that the reform applied to younger cohorts, while older cohorts were exempted from the new rules. We find that children of parents who were pushed out of DI or had their benefits reduced are 11% less likely to participate in DI themselves, do not alter their use of other government safety net programs, and earn 2% more in the labor market as adults. The combination of reduced government transfers and increased tax revenue results in a fiscal gain of 5,900 euros per treated parent due to child spillovers by 2014. Moreover, children of treated parents complete an extra 0.12 years of schooling on average, an investment consistent with an anticipated future with less reliance on DI. Our findings have important implications for the evaluation of this and other policy reforms: ignoring parent-to-child spillovers understates the long-run cost savings of the Dutch reform by between 21 and 40% in present discounted value terms.
    Keywords: Peer effects; disability insurance; intergenerational links
    JEL: I38 H53 J62
    Date: 2018–01–30

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