Since the introduction of Medicare in 1984, the proportion of the Australian population with private health insurance has declined considerably. Insurance for health care consumption is compulsory for the public health sector but optional for the private health sector. In this paper, we explore a number of important issues in the demand for private health insurance in Australia. The socio-economic variables which influence demand are examined using a binary logit model. A number of simulations are performed to highlight the influence and relative importance of various characteristics such as age, income, health status and geographical location on demand. A number of important policy issues in the private health insurance market are highlighted. First. evidence is provided of adverse selection in the private health insurance pool, second, the notion of the wealthy uninsured is refuted, and finally it is confirmed that there are significant interstate differences in the demand for private health insurance.

Item Type:	Refereed Article
Research Division:	Economics
Research Group:	Applied economics
Research Field:	Health economics
Objective Division:	Economic Framework
Objective Group:	Microeconomics
Objective Field:	Microeconomics not elsewhere classified
UTAS Author:	Kidd, MP (Dr Michael Kidd)
ID Code:	8464
Year Published:	1996
Web of Science® Times Cited:	48
Deposited By:	Economics and Finance
Deposited On:	1996-08-01
Last Modified:	2011-08-19
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