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Adverse Selection and the Decline in Private Health Insurance Coverage in Australia: 1989–95
Author(s) -
Barrett Garry F.,
Conlon Robert
Publication year - 2003
Publication title -
economic record
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.365
H-Index - 42
eISSN - 1475-4932
pISSN - 0013-0249
DOI - 10.1111/1475-4932.00104
Subject(s) - adverse selection , health insurance , actuarial science , private insurance , population , business , group insurance , selection (genetic algorithm) , national health insurance , environmental health , insurance policy , income protection insurance , demography , demographic economics , general insurance , health care , medicine , economics , economic growth , artificial intelligence , sociology , computer science
The decline in private health insurance coverage over the period 1989–95 is analysed using the ABS National Health Surveys. Individuals’ health status and health risk behaviours are found to be significant determinants of their decision to purchase private health insurance. At a point in time, the pool of the insured is very heterogeneous, with a mix of both good and bad health risks. It is found that the decline in insurance coverage over the period 1989–95 coincided with an increase in the degree of ‘adverse selection’ within the insured population.