Impact of health insurance in Vietnam on healthcare utilization, selfreported health, and financial choices.Impact of health insurance in Vietnam on healthcare utilization, selfreported health, and financial choices.Impact of health insurance in Vietnam on healthcare utilization, selfreported health, and financial choices.Impact of health insurance in Vietnam on healthcare utilization, selfreported health, and financial choices.Impact of health insurance in Vietnam on healthcare utilization, selfreported health, and financial choices.Impact of health insurance in Vietnam on healthcare utilization, selfreported health, and financial choices.Impact of health insurance in Vietnam on healthcare utilization, selfreported health, and financial choices.Impact of health insurance in Vietnam on healthcare utilization, selfreported health, and financial choices.Impact of health insurance in Vietnam on healthcare utilization, selfreported health, and financial choices.Impact of health insurance in Vietnam on healthcare utilization, selfreported health, and financial choices.Impact of health insurance in Vietnam on healthcare utilization, selfreported health, and financial choices.Impact of health insurance in Vietnam on healthcare utilization, selfreported health, and financial choices.Impact of health insurance in Vietnam on healthcare utilization, selfreported health, and financial choices.
1 MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HO CHI MINH CITY TRUONG ANH TUAN IMPACTS OF HEALTH INSURANCE IN VIETNAM ON HEALTHCARE UTILIZATION, SELF-REPORTED HEALTH, AND FINANCIAL CHOICES SUMMARY OF DOCTORAL THESIS MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HO CHI MINH CITY TRUONG ANH TUAN IMPACTS OF HEALTH INSURANCE IN VIETNAM ON HEALTHCARE UTILIZATION, SELF-REPORTED HEALTH, AND FINANCIAL CHOICES Major: Economic development Code: 9310105 Academic advisors: Dr Le Thanh Loan Assoc Prof Dr Pham Khanh Nam The research was conducted and completed at University of Economics Ho Chi Minh City: Academic advisors: Dr Le Thanh Loan Assoc Prof Dr Pham Khanh Nam Reviewer 1: Reviewer 2: Reviewer 3: : The thesis will be defended at University of Economics Ho Chi Minh City At hour day month year The thesis can be found at the following library: …………….……………… Chapter 1: INTRODUCTION Background As health insurance coverage is being extended in Vietnam, research into the policy's effects has become a high concern In reality, there have been a number of studies on the impact of health insurance on vulnerable groups However, most of the research has only focused on children and the poor The free health insurance program for the Vietnamese elderly generates a natural experiment that may be utilized to evaluate the effects and supplement existing empirical findings on moral hazard In Vietnam, co-payments were first introduced in 1998, but the effect of pharmaceutical cost-sharing policies on health outcomes in the Vietnamese healthcare setting has not been studied yet The question of whether or not co-payments reduce healthcare utilization and therefore affect individuals' health status remains unanswered Enrolling in health insurance is assumed to have an impact on other financial services such as savings, borrowing, investing, and other insurance in a household However, there is little empirical evidence to support the link between health insurance and financial services for families in Low- and middle-income countries (LMICs) No research has been conducted on the impact of health insurance on other financial services in Vietnamese households Health insurance and healthcare scheme in Vietnam 1.2.1 Development of health insurance in Vietnam Vietnamese health insurance has been in place for almost 29 years It had been piloted in some provinces before 1992, including Hai Phong, Quang Tri, and Vinh Phu The government issued Decree 299/HBT on August 15, 1992, and it was in force from 1992 to 1998 1.2.2 Healthcare scheme in Vietnam Payments in health insurance in Vietnam are basically made on a tripartite basis The insured pay The Vietnam Social Security Agency (VSS) premiums, but they also pay co-payments when they visit a healthcare facility for a medical examination and treatment The contracted providers are responsible for delivering services to insured individuals and claiming reimbursement from the VSS (Ha et al., 2021) Objectives of thesis This thesis’s objectives are as follows: To assess the degree to which the health insurance program for the elderly facilitates healthcare utilization and provides financial protection to covered individuals To explore the impacts of having health insurance on households' choices of financial services such as private insurance, savings, investments, and credit To examine the impacts of health insurance co-payments in Vietnam on the self-reported health of those covered by the plan Research questions Based on the research objectives, the specific research questions are as follows: What are the impacts of health insurance for the elderly on the probability of an outpatient visit, the probability of an inpatient visit, the number of outpatient visits, the number of inpatient visits, the expenditures per outpatient visit, and the expenditures per inpatient visit? What impacts does health insurance have on households' choices of private insurance, savings, investments, and credit? What impact co-payments in health insurance have on reported health among the insured? Scope of the thesis For the research on the effects of health insurance on healthcare use and out-of-pocket expenditures, the current study centers only on the behaviors of elderly adults aged around 80 years in rural regions of 63 provinces and cities in Vietnam The scope of this study on the effects of health insurance on household financial choices is restricted to rural households living in the provinces of Ha Tinh, Thua Thien Hue, and Dak Lak The boundary of the study on the effect of the co-payment program on health status is limited to rural individuals in the provinces of Ha Tinh, Thua Thien Hue, and Dak Lak Structure of the thesis The thesis is organized in an essay-based format, with three essays addressing different health insurance-related impacts in Vietnam This thesis is divided into six major chapters Chapter 2: THEORY AND LITERATURE REVIEW Theoretical backgrounds 2.1.1 Model of demand for health The Grossman model of demand for health has been generally applied in the health economic field by many researchers (Mwabu, 2007) In Grossman’s model, people are endowed with an initial stock of health, which depreciates over the years, but can be increased by investment Individuals invest in health by consuming healthcare and also combining exercise, diet, and time These investments help to maintain or improve people’s stocks of health, which in turn provide them with healthy days (Folland et al., 2013) 2.1.2 Behavioral model of health services utilization This model was originally developed by Ronald M Andersen in the 1960s to explain why families utilize healthcare, then revised by himself, and it has gone through four phases (Andersen, 1995) In this model, Andersen revealed that the utilization of health services is a function of three groups of factors, including predisposing factors, enabling factors, and need factors 2.1.3 Moral hazard Moral hazard can be divided into two distinct types, which are called ex-ante moral hazard and ex-post moral hazard (Chun-Wei Lin, 2012) Essentially, both types of moral hazard behaviors occur following individuals purchasing insurance Ex-ante moral hazard refers to the phenomena prior to the advent of illness in which insured individuals engage in risky health behaviors, increasing the probability of a loss Ex-post moral hazard is related to the increased consumption of healthcare services once an event of illness has occurred (Jowett et al., 2004) 2.1.4 Moral hazard and Cost-sharing To reduce the social welfare losses due to moral hazards in healthcare, health economics justifies the use of cost-sharing as a policy tool (e.g., a deductible, co-payment, or co-insurance) to limit the utilization of healthcare services (Folland et al., 2013) 2.1.5 Theory of precautionary savings The basic implication of the theory is that individuals, in the presence of uncertain future income, are likely to diminish consumption and save more Conceptual framework Figure 2.1: Conceptual framework for the thesis Program evaluations 2.3.1 Program impact measures There are a range of program effect measures, and the choice of which measure to employ will depend on the policy topic of interest A few of the measures include Average Treatment Effect (ATE), Average Treatment Effect of the Treated (ATT), Local Average Treatment Effect (LATE) 2.3.2 Program impact evaluation methods The program is not assigned randomly but rather based on the needs of communities and individuals who then self-select the program (Khandker et al., 2009) As a result, participants have different characteristics that make them more likely to join the program than non-participants and also impact their outcomes Selection bias is the term used to describe this phenomenon (Becker & Caliendo, 2007) The use of experimental and quasi-experimental approaches is motivated by the goal of eliminating selection bias Empirical literature review and research gaps 2.4.1 Review of key findings Impacts of health insurance on healthcare utilization and out-of-pocket expenditures The current understanding of the impacts of health insurance on healthcare utilization and out-of-pocket expenditure of the elderly in LMICs is inadequate at the moment due to a scarcity of literature and inconsistent findings from current studies Mixed and limited findings rationalize the need to further investigate the impacts of health insurance on the elderly In this regard, the present thesis seeks to cover some such gaps by evaluating the effects of health insurance on healthcare utilization and out-of-pocket expenditures of the elderly in Vietnam 1.3.2.3 Impacts of health insurance on households’ financial service choices In developing countries, households often include several financial services in their risk management strategies; thus, the correlations between these services should be taken into account It emphasizes the importance of more research into the impact of health insurance on concurrent financial services in order to present a more detailed picture of the effects and to account for their correlations 1.3.2.4 The impact of cost-sharing on health There is a paucity of studies examining the effects of cost-sharing on either overall self-reported health or disease-specific health The results are mixed, which highlights the need for more research to be conducted Because the vast majority of previous research was carried out in developed countries, the conclusions drawn from those studies may not be applicable to countries that are still in the process of developing This indicates that research is even more urgently needed in developing countries 2.4.2 Review of methodologies Methodologies for studies on the impacts of health insurance on healthcare utilization and out-of-pocket expenditures The methodological choices used for each study are mostly driven by the exogenous changes induced by a change in a health policy or the implementation of a new program And because most research uses secondary data, the availability of data in the countries where the authors want to studies also affects the methods used Methodologies for studies on the impacts of health insurance on households’ financial services While there is empirical evidence of correlations between financial services, previous research examining the impact of health insurance on financial services using quasi-experimental approaches overlooked the correlations Methodologies for studies on the impact of cost-sharing on health An issue with measuring the effects of a program is that participants are not assigned to the program at random This means that there may be factors affecting program participation and outcomes that were not observable by the researcher, resulting in selection bias In examining a cost-sharing program, the term "selection bias" is less intuitive since 11 3.5.2 Robustness checks The robustness of the baseline results will be verified by narrowing down the window size around the cutoff point The findings from the robustness checks are that the impact of the health insurance program on expenditures per outpatient visit is statistically significant with smaller samples Discussion The findings imply that health insurance reform strategies based only on universal health coverage may be insufficient to expand healthcare access in LMICs This issue was also mentioned by M T Nguyen (2020) when studying the effects of free health insurance for children in Vietnam Conclusion The most remarkable finding to emerge from this research is that the health insurance program for the elderly in Vietnam causes no moral hazard effect This result does not confirm previous research carried out in this area in LMICs However, it serves as evidence that the health-seeking behavior of the middle-old in the presence of insurance may be different from that of other generations Chapter 4: IMPACTS OF HEALTH INSURANCE ON HOUSEHOLDS’ FINANCIAL CHOICES: EVIDENCE FROM VIETNAM Introduction When assessing the impact of health insurance, one important issue that previous research has generally overlooked is the interconnectedness of financial services In practice, households may use a variety of financial services, some of which correlate with one another (Farrell et al., 2016; Giesbert et al., 2011; Viganò & 12 Castellani, 2020) Hence, in the presence of correlations, estimates from separate equations of financial service choices are inefficient (Belderbos et al., 2004; Greene, 2012); additionally, these estimates not tell the whole story of how health insurance affects financial tools in households' risk management baskets Controlling for endogeneity is a task that researchers investigating the impact of health insurance coverage on financial service choice have to perform In this study, I use a recursive multivariate probit model to circumvent endogeneity issues caused by unobserved heterogeneity Data and variables 4.2.1 Data source This research is based on data from the Thailand-Vietnam Socioeconomic Panel (TVSEP) project I use data from three waves, in 2013, 2016, and 2017, but limit my sample to Vietnamese households that supply the relevant information 4.2.2 Variable definitions and descriptive statistics I include five dependent variables The status of health insurance is the most important dependent variable It is a binary indicator that denotes whether a family is covered by either government or private health insurance but not by the government's free health card Four financial service choices are also dependent variables These variables indicate whether households used private insurance, savings, investments, or credit in the previous year Assuming that household characteristics influence the likelihood of obtaining financial services, the vector of control variables in my analysis contains a range of sociodemographic factors 13 Conceptual framework The theory of precautionary savings provides the conceptual basis for this research By making sure a family has access to healthcare services, health insurance reduces the uncertainty about future health costs As a result of this financial protection, it is expected that various changes will occur in categories such as private insurance, savings, investment, and credit Research hypotheses and methods 4.4.1 Research hypotheses Hypothesis 1: Health insurance positively affects private insurance Hypothesis 2: Health insurance has a positive impact on savings Hypothesis 3: Health insurance has a positive impact on investments Hypothesis 4: Health insurance has a negative impact on credit choice 4.4.2 Research methods The model in this study is a recursive five-equation system with a reduced equation for health insurance coverage and structural form equations for each of the four financial service choices: private insurance, savings, investments, and credit Let Y , , , , = {Y , Y , Y , Y , Y } denote a vector of five dummies representing, in that order, health insurance, private insurance, savings, investments, and credit Y ∗ = β X + γ R + ε (1) ∗ (2) ∗ (3) ∗ (4) Y = α Y + β X + ε Y = α Y + β X + ε Y = α Y + β X + ε 14 Y ∗ = α Y + β X + ε 1, if Y ∗ > Y = 0, if Y ∗ ≤ 1, if Y ∗, , , > Y, , , = 0, if Y ∗, , , ≤ (5) X is a vector of exogenous variables that is identical in all five equations R is an instrumental variable (IV) which is the government health insurance coverage rate in a district The error terms ε , ε , ε , ε , and ε follow a multivariate normal distribution ε ⎛ε ⎞ ⎜ε ⎟ ~N(0, ∑ ), of which, ∑ = ε ⎝ε ⎠ ρ ⎛ ⎞ ρ ρ ⎜ ⎟ ρ ρ ρ ρ ρ ρ 1⎠ ⎝ρ Empirical strategy for robustness checks To test the robustness of the coefficients in the multivariate probit model, I treat the data set as a panel data set I examine the effect of health insurance on private insurance, savings, investments, and credit using an IV two-stage least-squares model that ignores the binary nature of treatment and outcome variables as well as their interconnectedness Thus, I adopt the model: Y = + θ X + φ R + ε (6) Y = + ω Y + θ X + ε (7) Y = + ω Y + θ X + ε (8) 15 Y = + ω Y + θ X + ε (9) Y = + ω Y + θ X + ε (10) Where Y is health insurance status of household i at time t, X denotes a vector of exogenous variables R is the IV, which is the district's coverage rate of government health insurance Y , , , = {Y ,Y ,Y , Y } is a vector of four dummies representing, in that order, private insurance, savings, investments, and credit of household i at time t As another robustness check, this research estimates recursive bivariate probit regressions for each pair of insurance and financial choices Results 4.5.1 Impacts of covariates The percentage of homes covered by government health insurance in a district is positively connected with the chance of a household getting health insurance in that district Risk attitude has a positive correlation with savings, investments, and credit Surprisingly, risk attitude is positively related to two forms of insurance With reference to household heads’ characteristics, male-headed families are less likely to have credit than female-headed households Households with an older head have a larger likelihood of purchasing private insurance; however, the negative coefficients of age squared suggest that this likelihood declines at a certain age Married heads of household have a positive association with private insurance In comparison to families headed by members of ethnic minorities, households headed by members of the King majority were more likely to have health insurance Furthermore, Kinh households have a greater likelihood of investing than ethnic minority families The number of 16 school years spent by household heads is positively associated with the chance of the household purchasing insurance, saving, and investing Regarding households’ characteristics, interestingly, insurance is adversely connected with the health status of family members Households with a greater number of members are more likely to purchase insurance, invest, and utilize credit than households with fewer members Asset value is positively correlated with health insurance but negatively correlated with investments Families who receive a greater amount of remittance are more likely to save and invest The number of members of sociopolitical organizations contributes to the likelihood of obtaining insurance, investing, and credit Households with more wage earners had a higher probability of purchasing insurance and obtaining credit but a lower probability of saving In terms of shocks, natural shocks reduce the likelihood of having health insurance and savings but raise the likelihood of investing and obtaining credit Social shocks decrease both the propensity to get private insurance and to save Households that have been subjected to economic shocks tend to purchase less insurance and save less but have more credit Crime shocks have a negative relationship with savings but a positive relationship with credit 4.5.2 Impact of health insurance on financial choices The sign of the coefficients in the multivariate probit model indicates that enrolling in health insurance increases families' probability of saving and investing but decreases their probability of gaining further credit 17 4.5.3 Correlations between the error terms There is a positive correlation between the residuals in the health insurance and credit equations There is a strong and negative correlation between residuals in health insurance and savings equations Robustness checks The two-stage least-squares random-effects technique and recursive bivariate probit regressions replicate the multivariate probit model's findings regarding the impact of health insurance on financial service choices It could hence be said that multivariate probit findings are robust to alternative econometric techniques Conclusion The results indicate that while health insurance has no influence on private insurance, it has a positive effect on savings and investments and a negative effect on credit, and these results are robust to different econometric specifications The effects demonstrate that health insurance plays a role in enhancing the financial well-being of families Additionally, the pattern of residual correlations in financial service equations shows that, to some degree, the linkages between financial services might be regarded as substitutes or supplements for families Chapter 5: THE IMPACTS OF CO-PAYMENTS ON SELFREPORTED HEALTH AMONG THE HEALTH INSURANCE INSURED IN RURAL VIETNAM Introduction In Vietnam, the cost-sharing plan in the form of co-payments was originally implemented in 1998 (The Government of Vietnam, 2005) and has been modified a few times since then This cost-sharing plan ...2 MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HO CHI MINH CITY TRUONG ANH TUAN IMPACTS OF HEALTH INSURANCE IN VIETNAM ON HEALTHCARE UTILIZATION, SELF-REPORTED HEALTH, AND. .. by evaluating the effects of health insurance on healthcare utilization and out -of- pocket expenditures of the elderly in Vietnam 1.3.2.3 Impacts of health insurance on households’ financial service... understanding of the impacts of health insurance on healthcare utilization and out -of- pocket expenditure of the elderly in LMICs is inadequate at the moment due to a scarcity of literature and inconsistent